Compose a paper that assesses the economic way of thinking (method of problem identification, model development, and theory testing). First, discuss the purpose of an economic model and how it can be tested. What are the relatives strengths vs. weaknesses involved in utilizing models to assess the conditions of the real world?
Second, as a way of applying the relative efficacy of an economic theory, you should pick one economic theory to evaluate. There are a wide range of economic models – if you just look through our textbook, you can see there are many different models presented there.
Here are just some examples of potential economic theories that you can examine in your paper:
- Rational actor paradigm (rational expectations, rational choice, etc.)
- Theory of the Invisible Hand (Adam Smith)
- Theory of Comparative Advantage (David Ricardo)
- Protectionism vs. Free Trade
- Classical Economics
- Keynesian Economics
- Market socialism
- Moral Hazard
- Game Theory
- Correlation analysis
- Regression analysis
There are many more models, but these are just a few to get you thinking about a potential example to focus on in your first paper. Some of the theories presented above will be covered in the rest of our class. However, in this preliminary paper, the purpose is for you to consider some of the assumptions that are made in a model, the predictive capability of the model, and your specific thoughts on the relative strength or weakness of that particular model. You can also discuss some issues related to how and why economic models sometimes fail. In analyzing the economic theory of your choice, it would be good for you to consider a specific example to examine.
Use and cite at least 1-2 credible references in addition to your textbook. There are about 3-4 pages.
You are also submitting your paper to Safe Assign (a built in plagiarism checker) to make sure all your sources have been cited properly. You can review your first submission and make corrections then submit for final grading by your instructor.