ECN 340 Lecture Notes - Lecture 1: Decision Rule, Greedy Reductionism, Demand Curve
5 Apr 2015
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Document Summary
A thought process, or the unique manner in which we approach problems confronted by human beings. A mental skill that incorporates a special view of human behaviour. Arises because of (a) unlimited desires and (b) limited resources to satisfy those desires. Unlimited desires includes both material and non material wants: love, health, friendship, sex, vacations, good looks (thus plastic surgery), length of life, etc, etc, etc. There are limited resources to satisfy all these wants (including time) Economists use the amoral approach to analyzing issues and problems facing human beings: humans pass judgement. The amoral approach is a devoid of our own values. The economist tries to understand the behaviour of others given their own values. Economists use theory to explain the world around them. A theory is a simplification or generalization that captures a reality ie. when the price of a product falls, generally, more of it is purchased.
