Which of Merton's concepts is key in economic theory?
Opportunity Cost
Self-Fulfilling Prophecy
Marginal Utility
Supply and Demand
Answer
Self-Fulfilling Prophecy, a crucial concept in economic theory, posits that certain beliefs can influence outcomes simply because they are widely held. If a significant portion of market participants believe that an event will occur, their actions can collectively cause it to happen. This powerful psychological effect underscores the significance of expectations and beliefs in shaping economic realities.
Merton's Corner: Exploring the Life and Work of Robert K. Merton
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