Prices as a factor in economic policy
The price is considered as an issue of economic theory, important for forming effective government economic policy. Neoclassical economic theory constructed within a framework of methodological individualism, contains a general economic equilibrium section destined to determine prices that depend on production costs and consumer preferences; but at the basis of equilibrium theory is a normative individual property theory that does not reflect reality. The aggregate market demand as the sum of the demands of independent and rational individuals, generally doesn't have properties of rationality, and equilibrium theory is unverifiable scholasticism. The article presents a positive holistic theory of market demand, preserving mathematical and modeling tools of neoclassical theory, the method of verification, and the holistic model of equilibrium with agents Population, Production, and State.