Mathematical Models in Economics: Usefulness and Shortcomings

This video seeks to explain to a general audience interested in economics, why mathematical models in economics are useful, but always why they have many limitations. Mathematical models are theoretical structures that are used to elucidate a theory and its methodology. The main purpose of a mathematical model in economics is to illustrate a relationship between the various forces that interact in the economic process. However, mathematical models are built under oversimplified assumptions and cannot reflect reality entirely. The fundamental problem with the use of mathematical models is that policymakers use them to implement and enforce their views of society on society as a whole whereas these models do not entirely reflect all the different variables that intertwine in the economy. As a result, mathematical models are misused and then generate flawed outcomes because policymakers rely on them to try to control people's lives.

[allakolesnik]

So much useful information and explanation in very simple language! I, as a non-English-speaking person, understood. Thanks.

[jackyoung]

I suggest you leave economics and Samuelson alone. Your video was just a waste of time. Mathematics show the soundness of economic analysis.