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    Neoclassical Economics

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    Alyssa Quiambao
    Neoclassical economics is an approach taught in undergraduate courses that emphasizes individuals and firms maximizing objectives through price competition. However, it fails to consider other types of competition and ignores other important economic aspects like advertising and business organization structures.

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    Neoclassical Economics

    Uploaded by

    Alyssa Quiambao
    11 views1 page
    Neoclassical economics is an approach taught in undergraduate courses that emphasizes individuals and firms maximizing objectives through price competition. However, it fails to consider other types of competition and ignores other important economic aspects like advertising and business organization structures.

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    Economics

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    Neoclassical economics is an approach taught in undergraduate courses that emphasizes individuals and firms maximizing objectives through price competition. However, it fails to consider other types of competition and ignores other important economic aspects like advertising and business organization structures.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    11 views1 page

    Neoclassical Economics

    Uploaded by

    Alyssa Quiambao
    Neoclassical economics is an approach taught in undergraduate courses that emphasizes individuals and firms maximizing objectives through price competition. However, it fails to consider other types of competition and ignores other important economic aspects like advertising and business organization structures.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 1

    Neoclassical economics

    The preceding portrait of microeconomics and macroeconomics is characteristic of the elementary


    orthodox economics offered in undergraduate courses in the West, often under the heading
    “neoclassical economics.” Given its name by Veblen at the turn of the 20th century, this approach
    emphasizes the way in which firms and individuals maximize their objectives. Only at the graduate level
    do students encounter the many important economic problems and aspects of economic behaviour that
    are not caught in the neoclassical net. For example, economics is, first and foremost, the study of
    competition, but neoclassical economics focuses almost exclusively on one kind of competition—price
    competition. This focus fails to consider other competitive approaches, such as quantity competition
    (evidenced by discount stores, such as the American merchandising giant Wal-Mart, that use economies
    of scale to pass cost savings onto consumers) and quality competition (seen in product innovations and
    other forms of nonprice competition such as convenient location, better servicing, and faster deliveries).
    Advertising also plays an important role in the process of competition—in fact, it may be more
    significant than the competitive strategies of raising or lowering prices, yet standard neoclassical
    economics has little to say about advertising. The neoclassical approach also tends to ignore the
    complex nature of business enterprises and the organizational structures that guide effective
    production. In short, neoclassical economics makes important points about pricing and competition, but
    in its strictest definition it is not equipped to deal with the varied economic problems of the modern
    world.

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