- Market dynamics are the forces that influence prices and the behavior of producers and consumers in the economy.
- These forces create price signals resulting from changes in supply and demand.
- Supply-side economics is based on the theory that the supply of goods and services is the most important determinant of economic growth.
- Demand-side economics argues that creating economic growth is driven by high demand for goods and services.
- Economic models cannot capture some of the dynamics that affect markets and increase market volatility, such as human emotions.