Scarcity, absolute or relative, is the main trait of our complex societies, and we all face problems of “scarcity” at all stages of our life. Economics is the science that helps to understand how governments, firms and individuals need to optimally allocate their scarce resources to satisfy at best their needs. Through theoretical models and empirical investigations, economists can disentangle firms’ problems of production, interpret individual’s choices of consumption and suggest, at a macro levels, reasonable policy recipes to policy makers. This science helps to understand the world as it is, and attempts to forecast as it is going to be. Very rich dynamic models of individuals’ behavior may predict the responses to markets changes and policy interventions. Those models are a powerful devise in the hands of governments to implement the most efficient policies to reach a given objective, and are a valuable tool, firms and individuals may use to best adapt to those policies interventions. Econometrics, the main empirical method in Economics, has nowadays reached very powerful interpretative and forecasting possibilities. Within reasonable and predictable boundaries of errors, Econometrics allows to extract from the data the most hidden but valuable information. And valuable and complete information is the prime condition to optimally allocate scarce resources.
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