Volkswirtschaft

Volkswirtschaft, in German-speaking contexts often referred to as Volkswirtschaftslehre (VWL), denotes the study of the economy of a country or region as a whole. It examines how scarce resources are allocated across sectors and agents, how production and consumption decisions interact, and how income is distributed. The field includes both macroeconomic analysis of aggregates and microeconomic analysis of individual behavior, but its core inquiry is the performance and policy of the national economy.

Key concepts include gross domestic product (GDP), national income, price level and inflation, unemployment, and the balance of payments. The standard analytical tool is the circular flow of income and expenditure, illustrating interactions among households, firms, government, and the foreign sector. Markets for goods and services, labor, capital, and financial assets coordinate decisions; interpretations rely on supply and demand, prices, and incentives.

Policy and empirical work focus on how to influence output, employment, and prices through macroeconomic policy, including monetary policy by central banks and fiscal policy through government spending and taxation. In open economies, exchange rates, capital flows, and trade balances matter, and models often incorporate international linkages and policy spillovers. Growth, inflation dynamics, unemployment, and productivity are central topics, with long-run growth theories and short-run business cycle analyses employing various theoretical frameworks.

Educational and professional context: VWL is taught in universities across German-speaking countries as a foundation of economic science and informs public policy, business strategy, and research. It is typically contrasted with Betriebswirtschaftslehre (BWL), which focuses on the management of individual firms.