Samuelson's theory

Samuelson's theory, primarily associated with Paul Samuelson, emphasizes how consumers and producers respond to changes in prices and income, influencing market demand and supply. He developed models showing how economic variables interact, such as the Aggregate Demand and Supply framework, to explain overall economic activity. The core idea is that individual behaviors and market mechanisms collectively shape economic stability, growth, and fluctuations. Essentially, Samuelson's work helps us understand how various factors like prices, income, and government policies impact the economy as a whole, guiding policymakers and economists in making informed decisions.