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Quantitative policy process depends on a portfolio of tools that have been drawn from a variety of disciplines besides discretionary political decision. Over the past two decades a new way of thinking has come to prominence; principally in natural sciences. Although, all the usual physical laws are obeyed, many systems are now viewed as ‘complex' and as such, cannot be very well understood using standard approaches to theorizing and modeling. As we have seen in the last sections, policy makers' self interests and in homogeneity i.e., heterogeneity and dynamised set up with time element causing time inconsistency problem pull the policy process away from the standard idealized would theories, it makes the case best to look for the tools of complex system to approach the problem at hand.
Some economists view complexity science as just another ‘fad' that will pass. But we will see by the end of this block that the underlying handicap of our standard tools and various promises the tools of the science of complexity, offer a more radical challenge that economics has faced as a discipline science since importation of the tolls of calculus and field theory from physics in the late 19th century.
Q. Define Heterogeneity? We know that breaking of the assumptions of homogeneity of agents, in welfare economics, makes it difficult to define social welfare function. Breakin
what is multi unit finance
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explanation and justify the condition of pareto optimality and verify the defination of contrect curve. statment; reallocation of the resources from 1 efficient point to another ef
With a background from the previous section we now study some of the critical characteristics of policy process. You have already studied earlier various technical theories relatin
A variety of interventions can affect outcomes. The important one are, intervention to solve coordination problem, information as an interventions, interventions to change the dyn
State ramsey rule of optimal commodity taxation and the intuition for it
Pigovian Analysis The starting point of the Pigovian welfare analysis is the notion that there is a resource allocation problem that can be optimally solved. Through hi
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