Chapter 2: Thinking Like An Economists
This chapter discusses the field’s of methodology
Questions to keep in mind:
o What is distinctive about how economists confront a question?
o What does it mean to think like an economist?
Economists devise theories, collect data and then analyze these data in attempt to
verify or refute their theories
The Scientific Method: Observation, Theory, and More observation
Theory and observation occurs in the field of economics
o Ex. If a country is experiencing inflation, economist may hypothesis that
the government is printing too much money. Undergoing data collection
and analysis on prices and money from different countries they use that
resource to try to prove their theory.
If the data collected disproves their theory, then the economist may
start to doubt the logic of his theory
The Role of Assumptions
Economists make assumptions, just