ECONOMICS has been described as a study of man in his ordinary business of life. As such it would seem to be a most prosaic and unromantic discipline. The term economics derives from two Greek words, oikou and nomos, meaning the ‘rule or law of the household’. The concept of the efficient use of resources on the part of the family was later carried over to society as a whole. The major role of economics seems to be the study of how best to utilize a fixed and fully employed productive potentials. Now, the productive capacity of modern economics has grown tremendously. Growing productivity and income, perhaps the most powerful engines of social change in modern times, inevitably affect the problems confronting those interested in social welfare.
The Wealth Of Nations (1776), one of the most influential books ever written was therefore not just a study of economics but a survey of human social psychology: about life, welfare, political institutions, the law, and morality.
© Adam Smith ⇒ Every individual… neither intends to promote the public interest, nor knows how much he is promoting it… he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain,and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. The Wealth Of Nations, Book IV, Chapter II, p. 456, para. 9.
© Alfred Marshall ⇒ Economics is the study of people in the ordinary business of life.
© Lionel Robbins⇒ Economics is the science which studies human behaviour as a relationship between given ends and scarce means which have alternative uses.
© Paul A. Samuelson⇒ Economics is the “study of how societies use scarce resources to produce valuable commodities and distribute them among different people.
© Say’s Law⇒ Supply creates its own demand
© John Maynard Keynes⇒ The Interaction of aggregate demand and aggregate supply may lead to stable unemployment equilibria.
⇒ Economics Is All About Efficiency”
⇒ A study of economics can describe all aspects of a country’s economy, such as how a country uses its resources, how much time labourers devote to work and leisure, the outcome of investing in industries or financial products, the effect of taxes on a population, and why businesses succeed or fail.