What is the economy?

The economy is the study of production, distribution and consumption of goods and services - economics. Economists are trying to understand the economy and the way it responds to different influences, such as changes in federal interest rates. Economics is considered to be social science.

The modern economy began in 1776, publishing the wealth of the nations of Adam Smith . This was the first complex defense of the free market and is still an influential work. The central point of the work was the concept of an "invisible hand", the idea that the market, even if it seems messy, is in fact led to the production of the right amount and diversity of goods and services. If there is no insufficient goods, there will be large economic incentives for production; If there is excess goods, there will be economic motivation to produce less or different types of goods. Smith's work was so influential that previous preliminary economic schools were abandoned after its publication. Economists have developed market theories that bring trends and behavior in realthe world.

Most economists advocate Laissez-Faire economics, which means an economy with minimal government intervention. They point to the collapse of the Soviet Union as, for example, an unsuccessful economy with too much central control and the success of the United States as the Laissez-Faire economy. Unfortunately, for economists, public opinion surveys often show that they approve limited government interventions in the economy.

Another basic principle of economic theory is that through their own interest among the large number of agents, wider social interests can be administered in the long run. When people focus on being so productive and possible and provide goods and services in sufficient demand, they benefit, but also the others who use these services and the public sector that takes money from the top through taxes.