Economic Modelling

Economic modelling involves creating simplified representations of real-world economic systems to analyze relationships and predict outcomes. These models use mathematical formulas and data to simulate how variables—like prices, wages, or policies—interact within an economy. They help economists understand potential impacts of decisions, forecast future trends, and evaluate policies' effectiveness. While models simplify reality to focus on key factors, they provide valuable insights by identifying patterns and testing scenarios, guiding policymakers, businesses, and researchers in making informed choices about economic issues.