What is Economics?


With the publication of “An inquiry into the nature and causes of wealth of nation” in 1776 by Adam Smith, economics starts to be known as a separate disciple in this dynamic world. Before this economics was a part of other social disciples. According to Adam Smith, “The study of the nature and causes of the wealth of nation is economics.” Comparing to other subjects economics is realized as a dynamic science. Because with the change in the social concept, role and value of government meaning and importance of business, realization by the countries for the need of international trade with the development of science and technology, etc, the concept and vision of economics also change. So, new and new economist to make it more dynamic adds some important dimensions. In this reference in 1890 “Principle of Economics” was published. In this book economist Alfred Marshal said, “Economics is on the one side a study of wealth and on the other and more important side a part of wealth of study of man.” It way other economist Lionel Robbins published other book in 1932 named by ‘An essay of the nature and significance of economic science’. In his book, he defined “Economics is the science which studies human behavior as a relationship between ends and scare means which have alternative uses.” Since, with the pace of time new concepts are added but the conceptual development of economics has not ended. Again, other greatest economist J.M. Keynes significantly changed the concept, value and use of economics. Keynes in his book, “The general theory of employment, interest and money” published in 1936 defined economics as “The study of administration of scare resources and the determinants of income and employment.” Thus it is proved that economics is such a subject, which has been always dynamic.

Concept of Micro and Macro Economics   

The whole economics or economic theory is broadly divided into two broad parts: Micro economics and Macro economics first coined and used by Ragnar Frisch and now all the economists have been using. Because of practical use of economic theories, the study of economics has been becoming essential for all the people of economic world. The study of   economics enables us to know about the business and production, consumers and sellers behaviors’, community and society, government and international etc. as economics tells us about human nature in terms of social aspects, business aspect, government aspect, it is also known by social science. Being a social science it tries to solve the big human problem: “Scarcity and Choice.” It implies the pattern of the utilizing the limited resources to fulfill unlimited human desires. However, as defined already to broad branches of economics are analyzed below.

4 thoughts on “What is Economics?”

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