Economic reality is the aggregate of economic events that occur in a society.
This concept is a widely used concept, but little theoretically worked on individually. We say individually, since in fact it has been studying continuously. What does economic science study? The economic reality. That is, it tries to explain what happens in reality, what is true or true. Reality is what is shown and what happens.
Therefore, economic reality has a lot to do with economic theory. At least, yes, hypothetically. That is, economic theory tries to study, in a great majority of cases, economic reality.
Other uses of the concept
Leaving the theoretical plane of the concept aside, its use can be extended to the economic analysis of a given situation. For example, to answer the question: what is the economic reality of country X?
What the questioner seeks as an answer is to know what is happening in the country. The answer could be: «In country X the gross domestic product (GDP) is growing at a rate of 3%, inflationit is stable at 1.5%, due to job creation it is slowing down. If we look at the sectors of economic activity, we can see how the agriculture sector is causing this slowdown in job creation, perhaps caused by changing weather conditions. For its part, the industrial and services sectors maintain the levels of growth that they had been showing the previous year. Finally, taking into account the metrics that indicate the distribution of income and the risk of poverty, we can verify that the positive evolution is contributing to improving equality among its citizens and reducing the risk of poverty, which has gone from 13 % to 11% in the last year. ”
The above would be a very simple example of what it would be like to describe the economic reality of a country. As you can see, it has also been included in it, social metrics that the economy is also in charge of. The economic reality is not only profitability and risk, they are also other aspects that are difficult to measure but equally or more important