This is because war has as the goal winning it (as a sought after end), generates both cost and benefits and, resources (human life and other costs) are used to attain the goal. But he said that economics can be used to study other things, such as war, that are outside its usual focus. Robbins described the definition as not classificatory in "pick out certain kinds of behaviour" but rather analytical in "focus attention on a particular aspect of behaviour, the form imposed by the influence of scarcity." He affirmed that previous economists have usually centred their studies on the analysis of wealth: how wealth is created (production), distributed, and consumed and how wealth can grow. Lionel Robbins (1932) developed implications of what has been termed "erhaps the most commonly accepted current definition of the subject": Įconomics is the science which studies human behaviour as a relationship between ends and scarce means which have alternative uses. Thus, it is on the one side, the study of wealth and on the other and more important side, a part of the study of man. It enquires how he gets his income and how he uses it. Īlfred Marshall provided a still widely cited definition in his textbook Principles of Economics (1890) that extended analysis beyond wealth and from the societal to the microeconomic level:Įconomics is a study of man in the ordinary business of life. The science which traces the laws of such of the phenomena of society as arise from the combined operations of mankind for the production of wealth, in so far as those phenomena are not modified by the pursuit of any other object.
John Stuart Mill (1844) delimited the subject matter further: On the satirical side, Thomas Carlyle (1849) coined " the dismal science" as an epithet for classical economics, in this context, commonly linked to the pessimistic analysis of Malthus (1798). Jean-Baptiste Say (1803), distinguishing the subject matter from its public-policy uses, defined it as the science of production, distribution, and consumption of wealth. to supply the state or commonwealth with a revenue for the publick services. Scottish philosopher Adam Smith (1776) defined what was then called political economy as "an inquiry into the nature and causes of the wealth of nations", in particular as:Ī branch of the science of a statesman or legislator a plentiful revenue or subsistence for the people . There are a variety of modern definitions of economics some reflect evolving views of the subject or different views among economists. By extension then, "political economy" was the way to manage a polis or state. Derived terms such as "economy" can therefore often mean "frugal" or "thrifty". The term is ultimately derived from Ancient Greek οἰκονομία ( oikonomia) which is a term for the "way (nomos) to run a household (oikos)", or in other words the know-how of an οἰκονομικός ( oikonomikos), or "household or homestead manager". The earlier term for the discipline was ' political economy', but since the late 19th century, it has commonly been called 'economics'. It is also applied to such diverse subjects as crime, education, the family, feminism, law, philosophy, politics, religion, social institutions, war, science, and the environment. Įconomic analysis can be applied throughout society, including business, finance, cybersecurity, health care, engineering and government. Other broad distinctions within economics include those between positive economics, describing "what is", and normative economics, advocating "what ought to be" between economic theory and applied economics between rational and behavioural economics and between mainstream economics and heterodox economics. Macroeconomics analyzes the economy as a system where production, consumption, saving, and investment interact, and factors affecting it: employment of the resources of labour, capital, and land, currency inflation, economic growth, and public policies that have impact on these elements. Individual agents may include, for example, households, firms, buyers, and sellers. Microeconomics analyzes what's viewed as basic elements in the economy, including individual agents and markets, their interactions, and the outcomes of interactions.
Įconomics focuses on the behaviour and interactions of economic agents and how economies work. Economics ( / ˌ ɛ k ə ˈ n ɒ m ɪ k s, ˌ iː k ə-/) is a social science that studies the production, distribution, and consumption of goods and services.
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