The Economist: Economics: An A-Z Guide

Is an increase in the number of people in relative poverty as a result of rising income inequality worth worrying about if absolute poverty is falling?

The market-oriented policies had been introduced largely because of two concerns: first, that taxing the rich heavily may discourage them from wealth creation; and second, that giving money to the poor can destroy market incentives to self-help and make the recipient of aid dependent on the giver.

government should intervene far more to shape the decisions taken by individuals in markets.

Macroeconomic policy is implemented under conditions of great uncertainty about the future. If things go wrong, or even if they go well, it will rarely be clear if a policy was right (or wrong) or merely lucky (or unlucky).

Economics is about how to maximise a person’s or a society’s “welfare”, not merely their financial wealth.

opportunity cost – which asks “What are you giving up to do this?”

economics: “the study of how society uses its scarce resources” or, more snappily, “the science of choices”.

experience showed that the seemingly clear relationship between unemployment and inflation had been at most a short-term phenomenon rather than an iron law of economics

another American president, Ronald Reagan, was right when he described economists as unworldly “people, who see something work in practice and wonder if it would work in theory”.