Understanding Demand in Economics

This lecture introduces the concept of demand in economics, emphasizing its importance as one of the core instruments of economic analysis. It explains the different types of demand, such as consumer demand and demand for factors of production. The lecture delves into the factors influencing willingness to pay, including income, preferences, and social norms. It also discusses allocation mechanisms based on willingness to pay, need, merit, and deserving. Through examples like housing and university admissions, the instructor explores how different criteria impact resource allocation in markets. The lecture concludes by highlighting the role of willingness to pay in market economies and the balance between market-driven allocation and other criteria.