ECONOMICS AS AN ACADEMIC DISCIPLINE

Most introductory textbooks on economics begin by posing the question, “What is Economics about?” Although economics is a vast subject and precise definitions are usually very complex, it is not a difficult matter to give a simple and sensible answer to this basic question.

Economics is as old as the human race: it is probably the first art which man acquired. When some cavemen went out to hunt while others remained to defend the fire or when skins were traded for flint axes we had economics. But economics as an academic discipline is relatively new: the first major book on economics Adam Smith's "The Wealth of Nations" was published in 1776. Since that time the subject has developed rapidly and there are now many branches of the subjects such as microeconomics, international economics and econometrics as well as many competing schools of thought.

Economics is essentially a study of the ways in which people apply their knowledge, skills, and efforts to the gifts of nature in order to satisfy their material wants. There is an economic aspect to almost any topic we care to mention in education. Economics is a comprehensive theory of how society works. The great classical economist Alfred Marshall defined economics as "the study of a man in the everyday business of life». This is rather too vague a definition.

Economics, then, is about the satisfaction of material wants. It is necessary to be quite clear about this; it is people’s wants rather than their needs which provide the motive for economic activity. We go to work in order to obtain income which will buy us the things we want rather than the things we need. If the resources available to people are insufficient to satisfy all their wants, we say that such resources are scarce. Any definition should take account of the guiding idea in economics which is scarcity. Virtually everything is scarce; not just diamonds or oil but also bread and water. How can we say this? The answer is that one only has to look around the world to realize that there are not enough resources to give people all they want. It is not only the very poor who feel deprived, even the relatively well-off seem to want more. Thus when we use the word 'scarcity' we mean that:

All resources are scarce in the sense that there are not enough to fill everyone's wants to the point of satiety. We therefore have limited resources both in rich countries and poor countries. The economist's job is to evaluate the choices that exist for the use of these resources. Thus we have another characteristic of economics: it is concerned with choice.

Another aspect of the problem is people themselves; they do not just want more food or clothing, but specific items of clothing and so on.

We have now assembled the three vital ingredients in our definition, people, scarcity and choice. Thus we could define economics as:

<== попередня сторінка	\|	наступна сторінка ==>
Глава 17.	\|	The human science which studies the relationship between scarce resources and the various uses which compete for these resources.

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