What does math have anything to do with economics?

Question

What the heck does asdf even mean?

Answer 1

Math is the core to just about everything. That is what is so great about math...it truly is the universal language.

Just like gravity has a mathmatical definition ( F = -G \frac{m_1 m_2}{r^2} ) so do economics. Not just the simple things like figuring out Debt to Income ratios and effective interest rates, but actual economic policy can be put to different equations that have a statistical outcome.

Hope that helps

Answer 2

At the graduate level, Economics is applied math. All of it.

My transportation economics book is all differential equations.
My macroeconomics class doesn't even use a book - just statistical and differential analysis.
My Time Series analysis course is all stats.

The good thing is, if you aren't a completely abstract thinker, economics provides a host of examples for understanding math better.

For a B.A. in econ, you'll want to have taken 2 classes of stats and 2 classes of calculus.

For an M.A., take theoretical stats as well as linear algebra and advanced calculus.

For a PhD, you'll want to have taken differential equations, real analysis, and perhaps topology and algebraic theory.

Answer 3

No math needed - just put it on your credit card like the U.S. Treasury does. Don't worry about the balance even if it is over 4 or 5 times your annual income like it currently is for the U.S. government.

I'm sorry the answer above is only good for Congressmen, especially those in the House Ways and Means Committee.


If you are thinking about studying Economics at the college level, you'll need a good background in algebra - especially graphing as a minimum.

Answer 4

There's not a lot of DOING math in economics, though if you need to work with any of the associated fields like finace, etc... You'll need to understand a few formulas. For the most part, the math you need in economics is understanding how to interpret the graphs and volumes that you deal with. A background up through calc would be helpful, but I can't say it's essential.

Answer 5

Economics has to do with the production, distribution and consumption of wealth either on a small scale (businesses and households) or a large scale (nations and their economies).

You see figures like the Consumer Price Index - how did they come up with that number? There are marginal units of production, currency rates and the Gross Domestic Product - where do they get those numbers? You have to know math in order to figure out these things; a lot of them are the result of mathematical formulas.

Answer 6

Supply and Demand Charts are important things in economics and you learn about these in Trig. Many economic factors like money, graphs, and interest are taught in high school math courses.Theorists write abstract mathematical models. An elegant theoretical model helps you understand the main ideas, as in the example of market equilibrium.

Answer 7

Economics is a science. Specifically, it is a science that seeks an understanding of how goods and services are disributed among groups of people. As with any science, mathematics is the way to analyze what is happening. In science, you cannot present an idea and expect it to be accepted without evidence. How does one provide evidence? Data, and specifically, the analysis of the data. How does one make sense out of data? Mathematics and Statistics.

Answer 8

At the simplest level, an economic system is exchanging one thing for another. Immediatly you have two items, with undefined value and circumstances... without math we couldn't use economics to our benefit. Math can assign a value, you need have something of value to trade and trade for. Math is also part of large scale economics... but this is a simple answer.

Answer 9

If you are speaking about economic theory, and principles of right and wrong economic action, then mathematics is not necessary. For example, I believe that trade with communist nations is immoral because we pump money into communist treasuries, whereby that money is used to stifle political dissent. Discerning the amount of trade that we do would entail mathematics, but any trade at all, to me, makes it immoral. Therefore, mathematics is unnecessary.
Also, mathematic computation is unnecessary when determining that it is unwise for America to trade with nations that possess a living standard much lower than ours.
Other than for economic idealism, mathematics is criticical to economics.

Answer 10

The study of economics involves predictions and optimization of cost, resources, time. From simple production of goods to building highways to deployment of military personnel to battle to policy-making. They all require collection and manipulation of data using basically probability/and statistics/game theory. The work of John Nash--"A Beautiful Mind"--is a good example of how mathematics contributes to making business decisions.