Economics is a choice between alternatives all the time. Those are the trade-offs.
Interpretation
Economics involves making decisions among different options, considering the costs and benefits of each choice.
In this quote, Paul Samuelson emphasizes that economics fundamentally revolves around the concept of trade-offs. Every economic decision entails choosing one alternative over another, highlighting the need to evaluate the potential benefits and costs associated with different options. This perspective underlines the importance of making informed decisions in the economic realm, as every choice can lead to significant implications.
In practice
This quote could be used in an economics class to explain the concept of trade-offs.
To a person of analytical ability, perceptive enough to realise that mathematical equipment was a powerful sword in economics, the world of economics was his or her oyster in 1935. The terrain was strewn with beautiful theorems begging to be picked up and arranged in unified order.
I can't think of a president who has been overburdened by a knowledge of economics.
My belief is that nothing that can be expressed by mathematics cannot be expressed by careful use of literary words.
Politicians like to tell people what they want to hear - and what they want to hear is what won't happen.
My family was well off but not rich. I spent the four years I was an undergraduate working on the beach. And it wasn't because I was lazy; it was because my freshman class would go to a hundred different employers and wouldn't get a nibble. That was a disequilibrium system. I realized that the ordinary old-fashioned Euclidean geometry didn't apply.
Economics has never been a science - and it is even less now than a few years ago.
We must first note that economic factors are taken into account in a world in which ignorance, prejudice, and mental confusion, encouraged rather than dispelled by the political organization, exert a strong influence on policy making.
Nothing so weakens government as persistent inflation.
In reality there is no such thing as an inflation of prices, relatively to gold. There is such a thing as a depreciated paper currency.
Firms don't just try to pay as little as possible to get the needed bodies on board; when there is unemployment, they ask themselves how wage cuts would affect the behavior of the employees. Would they quit or feel dissatisfied and work less hard on the firm's behalf if they feel that wage policies are unfair?
There would be plenty of justification to raise revenues in order to subsidize businesses that employ low-wage workers. But there can be no justification for pandering to the economy's entire bottom half merely to attract its votes.
It is my guiding confession that I believe the greatest error in economics is in seeing the economy as a stable, immutable structure.
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