Hidden behind the day-to-day political scandals which consume the mainstream media is the impending inevitability of an economic crisis. Although individuals around the world are still reeling from the 2008 financial meltdown, the next recession in America is just around the corner after several years of moderate macroeconomic growth. (The fact that individuals themselves haven’t felt this growth directly is a problem in itself, but a topic for another day.)
Economics as a discipline has much more to offer than mere market analysis or monetary theory; it is an analytical framework for human action and individual thought. Economics can answer many questions about human behavior in society – ranging from why people don’t vote to why terrorists commit heinous political violence – except for one of the most important questions in life: WHEN?
With a primary focus on the effects of people’s actions, Economics is at the mercy of the individual humans, who not only have the capacity for stunning ingenuity in problem-solving but also are prone to flippant and transitory whims. Whether through creativity or through passing fancy, individuals have the capacity to change the course of human history more quickly than it will take you to finish reading this article. When trying to study the messy, complex interactions which comprise society, can you blame the poor economist (or any social scientist) for getting his timing wrong?
Main take away here: the economist isn’t as crazy the random guy on the street corner with a sign saying the end is near, but he isn’t a man with a crystal ball.
From the sustained stock market growth and the abnormally low unemployment rate, America is due for an economic dip sometime soon; however, take with caution the statements of anyone who claims to know the exact timing of his predictions.
If you are interested in knowing the WHY behind recessions, now you are thinking like a real economist!
By: Gabrielle Etzel