Economic model is a simplified image of economic reality that allows you to highlight the most important things in a condensed, compact form.

Economic models must meet a number of requirements:

• content;
• the realism of the accepted premises and assumptions;
• the ability to make forecasts;
• possibility of information support;
• possibility of verification.

There is no general consensus among economists about which requirements should be prioritized.

Main stages of creating an economic model

The creation of any theoretical model, including an economic one, goes through several stages:

• variable selection;
• determining the assumptions that need to be made so as not to complicate the model;
• putting forward one or more assumptions, hypotheses explaining the relationship between parameters;

Variables used in theory are specific quantities that have different meanings.

There are endogenous and exogenous variables:

Endogenous Variables- these are variables that are directly included in the model, being objects of study (in our example, this is the number of goods: grain and rockets)

Exogenous variables- these are variables that affect the quantities being studied, but are not the object of study (in our example, the number of goods produced by society is influenced by the availability and level of technology). For convenience, they are taken as constant values.

Assumptions (scientific abstractions) help avoid excessive complexity in creating a theory. (in the model, such assumptions include: limiting production to two goods, a given amount of resources, a constant level scientific and technological progress, lack of foreign economic relations).

Hypothesis— the main element of the model. A hypothesis is an attempt to explain in one statement how endogenous variables are related to each other.

In our example, an analysis of the behavior of society under conditions allows us to notice that a certain amount of one product inevitably forces a reduction in the production of a certain amount of another product and vice versa. This allows us to hypothesize the existence of opportunity costs of production.

Hypotheses, as a rule, involve the formation of a functional relationship between unknowns in the form of a formula, table and graph.

Main types of economic models

Economic theory mainly uses models two types: optimization and equilibrium.

Optimization models are used to analyze the behavior of individual economic agents (consumers, producers, etc.) to find optimal values. These models use marginal indicators: , marginal income, etc. This analysis usually called (from English margin).

Models are used to study relationships between economic agents. In the analysis, it is assumed that the system is in equilibrium if the interacting forces are balanced and there is no internal impulse to disturb the equilibrium.

The importance of equilibrium models is explained by the fact that individual market subjects, households and firms can optimize their position only if they have complete information about the market for the good they offer and about the markets for the resources they consume. The absence of such information forces the subject to make a decision: how much of a good he could buy (or sell) with some change in its price and provided that the prices of all other goods remain unchanged.

The model of equilibrium between supply and demand is the basis of microeconomic market analysis.

Types of economic models

Like science economic theory has not only its own subject (what is studied), but also special research methods (how it is studied). The most important method is the construction of economic models.

We widely use models in our Everyday life without even realizing it. A typical model is a city map, i.e. his image described according to certain rules. On it we see the location of streets and highways, objects of interest to us. Such a map does not, however, contain the information presented in in this case unimportant (shop opening hours, street cleanliness, road surface condition, etc.).

Likewise economic model represents a simplified formal description of the parties of interest to us economic phenomenon.

There are two types of models: optimization and equilibrium. Optimization models are used to study the behavior of individual economic agents or their groups and show how economic agents (their groups) maximize their well-being. Examples may be a model of behavior of a company, a model of behavior of an individual consumer. Equilibrium models are needed to study the relationships between economic agents and their groups. Example - formation model market price influenced by the demand of all buyers and the supply of all sellers.

A good economic model has a number of properties:

• it is not overloaded with details; the information it contains should not be more than is necessary to solve the task;
• the premises and assumptions of the model are meaningful and realistic;
• it is possible to collect information that corresponds to the conditions of the model;
• The model allows us to explain and predict actually observed economic phenomena.

They play a very important role in the economy mathematical models. Their use allows us not only to make general assumptions about various events, but to accurately calculate the quantitative consequences of certain decisions and thereby provide specific recommendations to the government and business. Here, for example, is a very pressing question about Russia’s entry into the World War trade organization(WTO). Supporters of accession talk about its advantages, opponents focus on the disadvantages, but only competent economists, based on econometric models, can say: “Here the gain will be approximately this much, and in this area such and such losses are very likely.”

Models are built for normative and positive analysis. Positive analysis establishes the causes and consequences of economic phenomena without assessing them. Such an analysis answers questions like: “What and why is happening in the economy today?”, “What and why happened yesterday?”, “What will happen if?..” For example, a Russian hero at a crossroads sees signs: “If you go to the right, there is a horse you will lose. If you go to the left, you’ll lose your head,” etc. These are all typical examples of positive statements.

Against, normative analysis contains an assessment of the desirability of certain consequences. The range of his questions is: “What needs to be done in order to?..” Normative analysis therefore contains a recommendatory part. There is a close relationship between these two types of analysis: normative statements influence the choice of the subject of positive analysis, while the results of the latter facilitate the achievement of normative goals.

For example, it was recognized as necessary to reduce inflation in the economy. This is a normative statement. But this goal can be achieved in different ways:

• by raising taxes to reduce the state budget deficit;
• by reducing government spending;
• freezing prices for basic types of raw materials and energy resources;
• limiting the growth of the dollar against the ruble, etc.

Choose The best way will allow positive analysis. For example, raising taxes will lead to such and such, reducing government spending will lead to such and such... Economic theory, therefore, does not relieve people of choice, but allows them to make this choice more conscious and responsible .

The author mentions business cycles ( economic cycles). Explain why government intervention in the economy is necessary at certain periods of this cycle? Based on social science knowledge, indicate any two measures monetary policy, which the state can use in such situations.

Read the text and complete tasks 21-24.

An economic system can be viewed as a giant computing machine that tirelessly works to solve an endless stream of quantitative problems: problems of optimal distribution of labor and natural resources, capital, ensuring the pace of balanced growth in production and consumption of thousands of items of goods, distributing the flow of products for consumption and investment and many others...

Anyone who has worked with computers knows that they are not infallible and are prone to making mistakes. It happens that the procedure at some stages of calculations rather moves away from the correct solution of a given specific problem rather than leading to it. Under certain conditions, a sequence of approximate solutions begins to wobble, like a bicycle on a slippery road, deviating first in one direction or the other from the correct trajectory. Majority modern theories cycles business activity This is how fluctuations in the production and consumption of various goods and services are explained, and the available evidence seems to suggest that such an interpretation may, in fact, be correct.

When a machine is not performing as expected, it is natural to be tempted to intervene. Such intervention may consist of lubricating the bearing or tightening the nut. Sometimes we find it necessary to abandon the calculations on the machine and do at least some of them by hand.

Any kind economic policy or economic planning is a deliberate intervention in the workings of the competitive machine. If, in pursuit of their specific goals, politicians

use instruments such as tariffs, subsidies or taxes, then most economic calculations are still carried out by the economic mechanism; the adjustment adds new components to the computer, but does not really interfere with its automatic operation...

Like any other complex device, a competitive economy can fail under stress, which is what happens when it faces problems that are significantly different from those it has dealt with before. It is not surprising, therefore, that in the transition from peace to war or from war to peace, in the transition from long-term stagnation to rapid growth, or in the need for rapid and abrupt technological changes, the solution of the problems of achieving general equilibrium that arise before the economic computer can be facilitated by the use of external influence, i.e. planning.

(V. V. Leontiev)

What quantitative problems does the author think the economic system solves? List three problems. How does the author characterize economic policy?

Explanation.

The correct answer must contain the following elements.

1. The quantitative problems that the economic system solves are indicated:

Problems of optimal distribution of labor and natural resources, capital;

Problems of ensuring the pace of balanced growth in production and consumption of thousands of items of goods;

Problems of distribution of the flow of output for consumption and investment.

Economic policy is a deliberate intervention in the operation of the competitive machine.

Economic model- this is a simplified image of economic reality, allowing you to highlight the most important things in a concise, compact form.

Economic models must meet a number of requirements:

There are two types of models: optimization and equilibrium. Optimization models are used to study the behavior of individual economic agents or their groups and show how economic agents (their groups) maximize their well-being. Examples may be a model of behavior of a company, a model of behavior of an individual consumer. Equilibrium models are needed to study the relationships between economic agents and their groups. An example is a model for the formation of a market price under the influence of the demand of all buyers and the supply of all sellers.

Microeconomics as a branch of economic theory.

Modern economic theory is divided into two key parts: micro- and macroeconomics.

Microeconomics as an independent scientific discipline was formed in the last third of the 19th century. She studies the behavior of individual economic entities.

Economic subjects (agents) are consumers (buyers of goods and services); firms producing goods and services; hired workers; capital investors; landowners. Economic entities vary in size and function in economic processes, but the role of each of these groups of economic entities is significant and necessary.

Microeconomics explains how and why economic decisions are made in lowest level. For example, how changes in prices and income affect the purchase of goods, how firms plan the scale of production, why workers decide where and how much they need to work.

Microeconomics studies the interaction of economic entities in industry markets (markets in which homogeneous goods are traded), explains the mechanisms of market pricing, the influence public policy on the activities of economic entities.

Today, the boundaries between micro- and macroeconomics are blurring, however, microeconomic analysis retains its specificity and develops in depth.

The central microeconomic problem is the problem of pricing, the formation of market prices.

Basic economic systems and their types.

In the last 150-200 years, different types of economic systems have operated in the world: two market ( market economy free competition (pure capitalism) and a modern market economy (modern capitalism)) and two non-market systems (traditional and administrative-command).

Market economy- This economic system, based on the principles of free enterprise, diversity of forms of ownership of the means of production, market pricing, contractual relations between economic entities, limited state intervention in economic activity. It is inherent in socio-economic systems where there are commodity-money relations.

Give examples of rational and irrational human behavior.

Local authorities have allocated money for the construction of a children's leisure center in the area. What could be the opportunity cost of a child care center?

Everyone knows that football is much less necessary for people than steel or food. However, professional football players are paid much more than farmers or steel workers. Why?

TM5

Answer the questions:

Why does the development of economic models involve a number of assumptions that simplify the economy?

What are economic models?

What are economic data and economic variables?

What is dimension? How does instantaneous dimension differ from interval dimension?

What is the difference between flows and stocks (funds) in the economy?

What is the difference between absolute and relative indicators in economics?

What are the differences between nominal and real values ​​in economics?

What are indexes? What is the index method used for?

What is a schedule? What is a graph used for when analyzing an economy?

Practical module 1.

Read the text, answer the questions about it.

"On the division of labor."

“The greatest progress in the development of the productive power of labor and a significant share of the art, skill and intelligence with which it

directed and applied, were apparently a consequence of the division of labor... For example, let's take... the production of pins.

A worker who is not trained in this production (the division of labor has made the latter a special profession) and who does not know how to handle

machines used in it (the impetus for the invention of the latter was probably also given by this division of labor) is hardly

Perhaps, with all his efforts, he can make one pin a day and, in any case, will not make twenty pins. But at that

organization that this production now has, it itself as a whole not only represents a special profession, but also

is divided into a number of specialties, each of which, in turn, is a separate special occupation. One

a worker pulls the wire, another straightens it, a third cuts it, a fourth sharpens the end, a fifth grinds one end to

inserting the head; making the head itself requires two or three independent operations... Thus, a complex

the labor of making pins is divided into approximately eighteen independent operations... I had to see...

a manufacture of this kind, where only ten workmen were employed, and where, consequently, some of them did two and

three different operations... These ten men produced over 48,000 pins per day.

Uncategorized

It is a very common way of analysis and forecasting economic situation. Moreover, economic models can be applied both at the level ordinary entrepreneur, either the investor, or at the level large companies, states and when studying the processes occurring in the global economy.

The essence of economic modeling is to build a simplified diagram of the processes occurring in a certain area of ​​the economy and highlight the most important factors in a compact and condensed form.

Construction economic model requires compliance with a number of factors, these include:

— realistic assumptions made

— possibility of forecasting

- sufficient Information Support

— possibility of practical verification.

In different cases, different sets of these requirements are prioritized; building a model that fully complies with all of them is quite difficult and the need for this arises quite rarely. This is due to the fact that main goal economic modeling is practical use models and, depending on the requirements, the priority requirements for the properties of the model change.

Process building an economic model goes through a number of stages. There are three main stages:

1. Selection of variables used
2. Making the necessary assumptions
3. Identification of the main hypotheses that explain the relationship between the model parameters.

Variables are specific data that form the basis of the model; they are divided into exogenous and endogenous. That is, internal and external. Assumptions make it possible to simplify a number of processes occurring in the model and thus simplify the model itself and speed up the process of its creation.

Nowadays, the most common types of economic models are equilibrium and optimized. Optimized ones are used mainly in marketing research and market research. Such models most often involve various marginal indicators, such as marginal revenue, marginal utility. This modeling method is often called margin analysis.

Equilibrium models are used to study the relationships between various economic entities. The main assumption in such models is that any modeled system is in equilibrium and factors that can throw it out of balance are not taken into account. Typically, the construction of economic models of this type is used to study various sales markets and the interaction of companies operating in the same market.

It is equilibrium models that are most applicable to private entrepreneurs and investors, since with their help they can obtain valuable information about the market in which they operate and the prospects for its development.

In addition to these types of models, they are also divided into positive and normative. In positive models, the main purpose of construction is to find the causes and consequences of any event or economic phenomenon. However, assessments of these phenomena are not given.

Normative models, on the contrary, allow one to evaluate a phenomenon or event, but do not allow one to establish the causes and consequences of this phenomenon. Both types of model building are interrelated and are used simultaneously for the most accurate modeling of economic processes.

Do you use economic models in your activities?

Andrey Malakhov, professional investor, financial consultant