What are the 3 Major Theories of Economics?
By BYJU'S Exam Prep
Updated on: November 14th, 2023
The 3 major Theories of Economics are Keynesian economics, Neoclassical economics, and Marxian economics. Economics is a type of social science that focuses on the many aspects of goods and services, including their production, distribution, and consumption. Key principles of economics focus on trade and labour and also on how people, governments, and businesses choose the allocation of resources.
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3 Major Theories of Economics
The 3 major theories of economics have the following meanings and responsibilities. Have a look at them and understand each one in detail:
- Keynesian economics: This type of economics includes a number of macroeconomics models and theories explaining aggregate demand, the expenditure of the economy as a whole, and how it affects economic productivity and growth.
- Marxism Economics: Marxism focuses on how capitalism has affected growth, efficiency, and employment. There are two socioeconomic classes in particular: the bourgeoisie (the ruling class) and the proletariat (the working class).
- Neoclassical Economics: The principles of neoclassical economics are used as a hypothetical framework for the description of the popular expected properties of capitalism, in which market prices fluctuate as demand and supply change their ability to reach equilibrium.
- Some additional principles of economics are monetarism, institutional economics, constitutional economics, etc.
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