Understanding Economic Equilibrium

1min Snip

00:00

Play full episode

Summary

Transcript

Episode notes

The concept of economic equilibrium emerged in the 1870s, with the marginal revolution, shifting from a text-based approach to a more visual, classical mechanics-inspired model. It emphasizes the intersection of supply and demand curves to define equilibrium. However, over generations, this concept has been oversimplified in the educational system, leading economists to focus solely on equilibrium rather than understanding its historical and theoretical context.

Nicholas Gruen is the CEO of Lateral Economics, Patron of the Australian Digital Alliance, and a Visiting Professor at Kings College London.

In this episode, Nicholas discusses the limitations of traditional economic models and emphasises the importance of nuanced problem-solving. He advocates for critical thinking and an interdisciplinary approach to decision-making within complex economic systems, and asks if embracing another paradigm, in this case, complexity economics, is really the answer.

Resources and links: