Historical legacy and context…
Joseph Schumpeter: “The subject matter of economics is essentially unique process in historic time. Nobody can hope to understand the economic phenomena of any, including the present epoch, who has not adequate command of historical facts and an adequate amount of historical sense...”
Evaluating and Comparing Economies:
- The performance of an economy is influenced by goals and priorities established by authorities and by environmental factors such as technology, natural resource endowment, and international economic and political factors...all interrelate.
- How the economy performs, relative to stated goals and priorities (prevailing norm), determine which other economic, social or political policies are necessary.
Evaluating and comparing economies cannot be purely objective.
- Conclusions influenced by the analyst’s point of view... the comparor’s norm.
- The comparor’s norm is based on the analyst's values indicating what goals and outcomes are most important for a country to attain. In every instance it determines the choice of evaluation criteria use in examining a country’s performance.