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economics summary

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Learn about the importance of economics and its two major branches

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The Editors of Encyclopaedia Britannica
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Below is the article summary. For the full article, see economics.
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consumerism Summary
Consumerism, in economics, the theory that consumer spending, or spending by individuals on consumer goods and services, is the principal driver of economic growth and a central measure of the productive success of a capitalist economy. Consumerism in this sense holds that, because consumer
Inflation, interest rates, and economic policy
monetary policy Summary
Monetary policy, measures employed by governments to influence economic activity, specifically by manipulating the supplies of money and credit and by altering rates of interest. (Read Milton Friedman’s Britannica entry on money.) The usual goals of monetary policy are to achieve or maintain full
Inflation, interest rates, and economic policy
fiscal policy Summary
Fiscal policy refers to the spending programs and tax policies that the government uses to guide the economy. Governments frequently use fiscal measures along with monetary policy to achieve economic policy goals, including: These three factors lay the general foundation for a government’s economic
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Austrian school of economics Summary
Austrian school of economics, body of economic theory developed in the late 19th century by Austrian economists who, in determining the value of a product, emphasized the importance of its utility to the consumer. Carl Menger published the new theory of value in 1871, the same year in which English