Since I'm reviving this blog, I thought I'd start a fresh in
some ways. I therefore have decided to open up this new era of the blog with
the simple, yet very difficult to answer question of what economics actually
is. It's a very ambiguous subject in regards
to how you'd define it, the study of what exactly? I've encountered a good
example of just how difficult it is to define the subject recently during my
search for a university. The fact that different universities place the subject
in different areas is the said example. The University of Birmingham, for
example, place the study of economics within the business school - giving the
subject a more monetary focus. However, this contrasts from the University of
Warwick whom place economics within the faculty of social sciences - looking
more at wants and scarce resources. This differentiation from the universities
suggests that Economics is a broader subject than some may have first imagined.
Let's look at a few potential ways of defining economics.
One definition could well be 'the human science which studies the relationship
between scarce resources and the various uses which compete for these
resources'. If we analyse this definition somewhat we could agree that this
definition holds true. Economics could most definitely be classed as a human
science. It's not an art and studying it will almost always involve looking at
the action of humans. The relationship between scarce resources and the uses of
resources is also looked at in the study of Economics. One of the first things
you learn about as a beginner economist is the basic economic problem of scarce
resources and unlimited wants. So, you wouldn't be wrong to define economics in
this particular way.
Another definition I've come across is that 'economics is
the science of production and consumption, or the use of goods and services'. Production
and consumption are definitely involved in the study of economics, these link
back to the scarce resources problem that occurs due to consumption being
higher than production. However, I feel using 'the use of goods and services'
in a definition for the subject is a bit lacklustre and doesn't quite do it
justice. But that isn't to say this definition is wrong, as it most certainly
isn't. Along with the likes of 'economics is the study of how to improve
society'. Economics does look at how best to allocate scarce resources to
improve society partly, but not all for that reason. These two definitions
aren't incorrect, I just think they don't get the whole point of the subject
across.
This debate wouldn't be complete without a token definition
relating somehow to money! 'Economics is the study of wealth'. Well, there it
is, the study of wealth. Somewhat true of course, the economy is measured in
terms of money, goods and services are normally purchased using money and a lot
of people evaluate their position in life by how much wealth they have. But
what actually is money? It's a medium for exchange when buying goods, a unit of
account for placing a value on things and a store of value when saving. So
technically, anything could have ended up being money instead of coins and
notes as long as it was in scarce and controlled supply, stable and able to
keep its value, divisible without loss of value and portable. Money does play a big part in the economy,
some would even say the economy revolves around money with the flow of income
and what not, but I'm still not entirely convinced the subject can be classed
as the study of wealth.
I could go on and on, reeling off lists of different
definitions of 'Economics', but I won't of course, you have better things to do
than read that. I'll leave it there and hope I've successfully got the point across
that I was trying to make -Economics is a very broad subject and therefore very
difficult to define whilst accurately including everything the subject covers.
If i was being asked, I'd class it as the study of scarce resources. I question
you to have a think about how you'd define the subject!
That's all from me for now, thank you for reading!
