Wednesday, May 14, 2014

Why are Price and Quantity Reversed?

So today I asked a seemingly simple question, why are the graphs in economics drawn the way they are.  Above is typically how the "x" and "y" axes are drawn with the dependent variable (that is being acted upon) on the "y" axis.  So logically one would expect that the "y" axis is quantity since price acts on it.  But no, in economics it is just the other way around.  Here is an explanation and apparently it simply comes down to Alfred Marshall's Principle of Economics which was a standard for most college educators (and therefore the standard for all others) in the 20th century.  He used geometry in understanding economics (so don't ask me for an explanation).  Thanks to Andrew Foos for the link on this question. 

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