Three Reasons Why Economists Have Different Views on Social Policy

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Examlex · Accepted Answer

The Answer is (1) In practice, social goals are vaguely understood and vaguely expressed. Nor is it clear what should be done when policies benefit some people at the expense of others. (There are no Pareto optimal policies.)
(2) Empirical economic evidence is almost always imprecise. Since economic studies always give an incomplete picture of reality, people tend to focus on the evidence that supports their position. Economist's value judgments influence which incomplete study to believe.
(3) A model focuses on certain aspects of reality and ignores others. The choice of which factors to include in a model depends on an economist's value judgments. Models that focus on different aspects of an issue may lead to different conclusions.

Three Reasons Why Economists Have Different Views on Social Policy

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