2.4 Conclusion: From Economic Statistics
to Economic Models


The three statistics discussed in this chapter—gross domestic product, the consumer price index, and the unemployment rate—quantify the performance of the economy. Public and private decisionmakers use these statistics to monitor changes in the economy and to formulate appropriate policies. Economists use these statistics to develop and test theories about how the economy works.

In the chapters that follow, we examine some of these theories. That is, we build models that explain how these variables are determined and how economic policy affects them. Having learned how to measure economic performance, we now learn how to explain it.