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Council of Economic Advisers (H1)<br />The team of three in the USA which advises the president on the state of the economy. This council was set up under the EMPLOYMENT ACT 1946. A principal task of the council is to assist the president in preparing his annual Economic Report to the Congress, a report formulating broad guidelines for stabilization policy and other aspects of the government's economic programme. The academics chosen as members of the council usually have political views close to those of the administration.<br /> <br /><em>Reference</em><br />Feldstein, M. (1992) 'The Council of Economic Advisers and Economic Advising in the United States', Economic Journa/102: 1223-34.
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consumer sovereignty (D1, M3)<br />The decisive power of consumers to determine the amount and pattern of production by freely choosing goods and services in accordance with their preferences. Adam SMITH in his rejection of MERCANTIusM turned the goal of economic activity to satisfying the consumer rather than producers. NEOCLASSICAL ECONOMICS built many of its theories on the notion of coNsuMER EQUILIBRIUM. Given the growth of large corporations with huge advertising budgets, GALBRAITH and others have challenged this view of the influence of consumers. Also, the increase in the role of government and the importance of MERIT GOODS have reduced the power of individual consumers in modern economies.<br /><em>See also:</em> countervailing power
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