Question 1a:
Thorstein Veblen came up with the theory of the Leisure Class in 1890s. With regards to consumer behaviour, his line of thought attempted to reject the rational and maximizing behaviour as well as the emulation of a powerful force.
His perception of the contemporary tribal societies was based on two major categories. The first one was based on the believe that survival is continuous work. Such societies reflected a strong communal benevolence and immense cooperation amongst the members. Moreover, societies shunned out antisocial behaviours. Secondly, Veblen considered a tribal society as a place of abundant output where leaders, such as priests and followers used force to enrich themselves. Besides, the leisure class entailed …show more content…
He sought to find out how businesses behave in order to maximize profits. In line with this line of thought, he critiqued all the orthodox economic theories including and economists including Smith, as well as classical and neoclassical economists. Notably, the wider view of Veblen’s view of market behaviour was driven by the need to understand engineers and capitalists. He believed that industrial engineers are the primary progressive factor of the contemporary economy. Also, be considered capitalists as individuals work in the financial sector.
By contrast, Marshallian model of behaviour of buyers in the market is the tendency to spend their hard earned income based on utility. Thus, consumers are obliged to buying commodities that offer the highest level of satisfaction to them. Notably, their choices were influenced by taste in conjunction with their buying capabilities. His theory was mostly derived from Bentham and Adam Smith in which self-interest is the main reason for motivating an individual’s actions. With the passage of time, Marshall formulated the theory of marginal utility in collaboration with many other …show more content…
Excessive optimism in the prospection of the stock market is significant in the overall success in the stock market output. Government bodies play a role in maximizing and stabilizing profits. Moreover, earnings are kept in a stable and constant mode by the involvement of big governments. Keynes idea of government intervention in the economy was based on the hypothesis of full employment. In his argument, he maintained that consumption in the economy is capable of generating demand, then production adjusts to that demand. It is also worth mentioning one of the interpretation of Keynes work is investments. The economist suggested that investments determines the real output. In his approach, investment can generate savings. What is more, Keynes maintained that with the propensity to consume, a given amount of investment would determine the level of income given a
Thorstein Veblen came up with the theory of the Leisure Class in 1890s. With regards to consumer behaviour, his line of thought attempted to reject the rational and maximizing behaviour as well as the emulation of a powerful force.
His perception of the contemporary tribal societies was based on two major categories. The first one was based on the believe that survival is continuous work. Such societies reflected a strong communal benevolence and immense cooperation amongst the members. Moreover, societies shunned out antisocial behaviours. Secondly, Veblen considered a tribal society as a place of abundant output where leaders, such as priests and followers used force to enrich themselves. Besides, the leisure class entailed …show more content…
He sought to find out how businesses behave in order to maximize profits. In line with this line of thought, he critiqued all the orthodox economic theories including and economists including Smith, as well as classical and neoclassical economists. Notably, the wider view of Veblen’s view of market behaviour was driven by the need to understand engineers and capitalists. He believed that industrial engineers are the primary progressive factor of the contemporary economy. Also, be considered capitalists as individuals work in the financial sector.
By contrast, Marshallian model of behaviour of buyers in the market is the tendency to spend their hard earned income based on utility. Thus, consumers are obliged to buying commodities that offer the highest level of satisfaction to them. Notably, their choices were influenced by taste in conjunction with their buying capabilities. His theory was mostly derived from Bentham and Adam Smith in which self-interest is the main reason for motivating an individual’s actions. With the passage of time, Marshall formulated the theory of marginal utility in collaboration with many other …show more content…
Excessive optimism in the prospection of the stock market is significant in the overall success in the stock market output. Government bodies play a role in maximizing and stabilizing profits. Moreover, earnings are kept in a stable and constant mode by the involvement of big governments. Keynes idea of government intervention in the economy was based on the hypothesis of full employment. In his argument, he maintained that consumption in the economy is capable of generating demand, then production adjusts to that demand. It is also worth mentioning one of the interpretation of Keynes work is investments. The economist suggested that investments determines the real output. In his approach, investment can generate savings. What is more, Keynes maintained that with the propensity to consume, a given amount of investment would determine the level of income given a