Economic Man

Dictionary Says

Definition of 'Economic Man '


First coined in the late 19th century, the term 'Economic Man' has developed to refer to a hypothetical individual who acts rationally and with complete knowledge, but entirely out of self-interest and the quest to maximize personal utility. Economic Man is an imaginary figure who is able to satisfy economic models that push for consumer equilibrium. All of Economic Man's choices are based on the fulfillment of his or her "utility function", meaning the ability to maximize any situation that involves choice.
Investopedia Says

Investopedia explains 'Economic Man '


Many economic models are hypothetical, and the assumptions on which they are built deviate from real-world conditions. For example, many economic-modeling assumptions assume that demand is a linear function of price. While this may sometimes be the case with certain goods, it is not reflective of the actual consumer environment. Economic Man is the principal, symbolic of every individual in society, whose preferences satisfy the condition specified in the models.
comments powered by Disqus
Hot Definitions
  1. Chicago Mercantile Exchange - CME

    The world's second-largest exchange for futures and options on futures and the largest in the U.S. Trading involves mostly futures on interest rates, currency, equities, stock indices and agricultural products.
  2. Private Equity

    Equity capital that is not quoted on a public exchange. Private equity consists of investors and funds that make investments directly into private companies or conduct buyouts of public companies that result in a delisting of public equity.
  3. Valuation

    The process of determining the current worth of an asset or company. There are many techniques that can be used to determine value, some are subjective and others are objective.
  4. Valuation

    The process of determining the current worth of an asset or company. There are many techniques that can be used to determine value, some are subjective and others are objective.
  5. Tech Street

    A term used in the financial markets and the press to refer to the technology sector. Companies like Intel, Microsoft, Apple and Dell are all considered to be part of Tech Street.
  6. Tech Street

    A term used in the financial markets and the press to refer to the technology sector. Companies like Intel, Microsoft, Apple and Dell are all considered to be part of Tech Street.
Trading Center