ECON 1B03 Chapter Notes - Chapter 2: Capital Good, Environmental Quality, Audio Commentary

• School: McMaster University
• Department: Economics
• Course: ECON 1B03
• Professor: Bridget O' Shaughnessy

Document Summary

Unit 1: the nature and method of economics - objective 2: 1. 2. 1 the scientific method and the role of assumptions. Economics as a social science is different from other sciences such as physics, in which controlled research experiments can be conducted in a laboratory setting. Experiments in the science of economics are conducted by. Accepting or rejecting the theory only after rigorous statistical analysis. coming up with theories for explaining the observations collecting data to conduct statistical analysis for testing the theories offered. It is important to note that history has an important role in the science of economics because it provides data and also suggests patterns for observations to be formed. Assumptions play a central role in constructing economic models by simplifying the complex world and making it easier to understand. It is important to make reasonable assumptions regarding an economic model, or else the model may be subject to harsh criticism by fellow economists.