Applied Economics

AAA

DEFINITION of 'Applied Economics'

The application of economic theories and principles to real world situations with the desired aim of predicting potential outcomes. The use of applied economics is designed to analytically review potential outcomes without the "noise" associated with explanations that are not backed by numbers. Applied economics can involve the use of econometrics and case studies.

INVESTOPEDIA EXPLAINS 'Applied Economics'

Because economics relies on the interpretation of historical events in its theories, applied economics can lead to "to do" lists for steps that can be taken to ensure stability in real world events. Although applied economics uses economic theory and principles, it is itself not a field of economics, such as neoclassical economics or the Austrian school.

RELATED TERMS
  1. Business Cycle

    The fluctuations in economic activity that an economy experiences ...
  2. Mechanism Design Theory

    An economic theory that seeks to determine the situations in ...
  3. Financial Economics

    A branch of economics that analyzes the use and distribution ...
  4. Macro Environment

    The conditions that exist in the economy as a whole, rather than ...
  5. Econometrics

    The application of statistical and mathematical theories to economics ...
  6. Economics

    A social science that studies how individuals, governments, firms ...
Related Articles
  1. How Influential Economists Changed Our ...
    Fundamental Analysis

    How Influential Economists Changed Our ...

  2. Understanding Supply-Side Economics
    Economics

    Understanding Supply-Side Economics

  3. Monetarism: Printing Money To Curb Inflation
    Economics

    Monetarism: Printing Money To Curb Inflation

  4. Economic Indicators That Do-It-Yourself ...
    Investing Basics

    Economic Indicators That Do-It-Yourself ...

comments powered by Disqus
Hot Definitions
  1. Correlation

    In the world of finance, a statistical measure of how two securities move in relation to each other. Correlations are used ...
  2. Letter Of Credit

    A letter from a bank guaranteeing that a buyer's payment to a seller will be received on time and for the correct amount. ...
  3. Due Diligence - DD

    1. An investigation or audit of a potential investment. Due diligence serves to confirm all material facts in regards to ...
  4. Certificate Of Deposit - CD

    A savings certificate entitling the bearer to receive interest. A CD bears a maturity date, a specified fixed interest rate ...
  5. Days Sales Of Inventory - DSI

    A financial measure of a company's performance that gives investors an idea of how long it takes a company to turn its inventory ...
  6. Accounts Payable - AP

    An accounting entry that represents an entity's obligation to pay off a short-term debt to its creditors. The accounts payable ...
Trading Center