Mathematical Economics

AAA

DEFINITION of 'Mathematical Economics'

Mathematical economics is a discipline of economics that utilizes mathematic principles and methods to create economic theories and to investigate economic quandaries. Mathematics permits economists to conduct quantifiable tests and create models to predict future economic activity.

INVESTOPEDIA EXPLAINS 'Mathematical Economics'

Mathematical economics relies on statistical observations to prove, disprove and predict economic behavior. Although the discipline is heavily influenced by the bias of the researcher, mathematics allows economists to explain observable phenomenon and provides the backbone for theoretical interpretation.

RELATED TERMS
  1. Economic Think Tank

    An economic think tank is an organization whose mission it is ...
  2. Economics

    A social science that studies how individuals, governments, firms ...
  3. Macroeconomics

    The field of economics that studies the behavior of the aggregate ...
  4. Microeconomics

    The branch of economics that analyzes the market behavior of ...
  5. Behavioral Economics

    The study of psychology as it relates to the economic decision ...
  6. Green Economics

    A methodology of economics that supports the harmonious interaction ...
Related Articles
  1. Nobel Winners Are Economic Prizes
    Options & Futures

    Nobel Winners Are Economic Prizes

  2. A Practical Look At Microeconomics
    Economics

    A Practical Look At Microeconomics

  3. Explaining The World Through Macroeconomic ...
    Options & Futures

    Explaining The World Through Macroeconomic ...

  4. The Fall Of The Market In The Fall Of ...
    Active Trading Fundamentals

    The Fall Of The Market In The Fall Of ...

Hot Definitions
  1. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
  2. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  3. Leading Indicator

    A measurable economic factor that changes before the economy starts to follow a particular pattern or trend. Leading indicators ...
  4. Wage-Price Spiral

    A macroeconomic theory to explain the cause-and-effect relationship between rising wages and rising prices, or inflation. ...
  5. Accelerated Depreciation

    Any method of depreciation used for accounting or income tax purposes that allows greater deductions in the earlier years ...
  6. Call Risk

    The risk, faced by a holder of a callable bond, that a bond issuer will take advantage of the callable bond feature and redeem ...
Trading Center