Economics -- What is the subject about???
What in the world is Economics? I’m sure this is the question, which most Sec 4 students have on their minds when they moved on to junior college. After all, this is a subject which very few people actually have any knowledge of, compared to the sciences and arts subjects like Geography and History. What irks me is that there are some people who think of economics as a study of business and financial markets and that you will learn how to earn money. There is more to Economics than finance (this is a little bit sensitive for economists do study financial and money markets, but they do not study them with the aim of earning money and their focus is entirely different from those of speculators and businessman). Another group of people who claims that Economics is a totally useless discipline (because of the adage that economists are never correct) irritates me even more, for these people do not know the subject that they are talking about and yet they dare to make such a remark! I shall now attempt to provide you with an idea of what Economics is, by examining it from its scope as well as its nature.
I am very sure that anyone who has flipped through the first few pages of any introductory Economics text would have seen the statement "Economics is the study of allocation of scarce resources". Indeed, that is a pretty apt summary of what the subject is about. Economics certainly tries to explain how certain resources (goods) are actually allocated (distributed) in society; how the market mechanism works; the role of the government in a country’s economy; international trade between countries; individual firms as well as financial markets and many more. Aha! Yes, indeed I have shown that Economics seems to be just concerned with markets, production and a lot of ‘business-like’ activities. Oh well, I do not deny that Economics is concerned about with the above, but in fact, Economics is concerned with other fields such as human and society’s welfare as well as explanations on human behaviour. In fact you can say that Economics is not a study of how you can earn more money, but a study of how the market mechanism evolved in our world. There is a huge chunk of Economics where we are concerned mainly with how our world allocates resources (the system that is now predominant in our world is the market mechanism), and economists do dwell into mercantilism, communism, socialism as well as other possible forms of economic systems. Economics is really concerned about society’s well being, and I totally agree with the idea that Economics teaches you, and lets you discover how the world works.
I guess with the above remarks, it will seem that I have classified Economics to be a subject that is totally academic and theoretical. Fortunately, this is not the case. Economics is looking for practical solutions to solve real-life problems around us. I’m sure everyone has heard about the Malthusian theory on population growth. Yes, economists are concerned with population and the birth rates. They are equally concerned about poverty and environment issues as well as trade developments. Applied Economics is one aspect of economics in which people are constantly racking their head to design better policies so that people will live a better life on the whole.
Hence, as we can see from the scope that I outlined above, Economics is indeed a relevant and practical subject that provides a theoretical background for people to understand the world. From then on, it is purely up to the individual to use the knowledge gained to understand the real world and apply it (and even come up with solutions that will maximise people’s welfare as well as make better decisions on the whole). It is a subject that requires a lot of academic rigour, and does train an individual’s critical thinking and decision-making skills. It is certainly not a subject that is irrelevant. In fact, even though people do criticise economists for failing to predict economic events correctly, they have actually done a great job in predicting its direction. As I quote Keynes, "it is always better to be vaguely right than to be exactly wrong".
Hence, I challenged those who wants to understand our world (in terms of politics, economics, finance, environment and social) to study economics. It is indeed a discipline that will open up boundaries, which you have never imagined, possible, as well as allows you to understand policies and make better decisions in your life.
I am very sure that anyone who has flipped through the first few pages of any introductory Economics text would have seen the statement "Economics is the study of allocation of scarce resources". Indeed, that is a pretty apt summary of what the subject is about. Economics certainly tries to explain how certain resources (goods) are actually allocated (distributed) in society; how the market mechanism works; the role of the government in a country’s economy; international trade between countries; individual firms as well as financial markets and many more. Aha! Yes, indeed I have shown that Economics seems to be just concerned with markets, production and a lot of ‘business-like’ activities. Oh well, I do not deny that Economics is concerned about with the above, but in fact, Economics is concerned with other fields such as human and society’s welfare as well as explanations on human behaviour. In fact you can say that Economics is not a study of how you can earn more money, but a study of how the market mechanism evolved in our world. There is a huge chunk of Economics where we are concerned mainly with how our world allocates resources (the system that is now predominant in our world is the market mechanism), and economists do dwell into mercantilism, communism, socialism as well as other possible forms of economic systems. Economics is really concerned about society’s well being, and I totally agree with the idea that Economics teaches you, and lets you discover how the world works.
I guess with the above remarks, it will seem that I have classified Economics to be a subject that is totally academic and theoretical. Fortunately, this is not the case. Economics is looking for practical solutions to solve real-life problems around us. I’m sure everyone has heard about the Malthusian theory on population growth. Yes, economists are concerned with population and the birth rates. They are equally concerned about poverty and environment issues as well as trade developments. Applied Economics is one aspect of economics in which people are constantly racking their head to design better policies so that people will live a better life on the whole.
Hence, as we can see from the scope that I outlined above, Economics is indeed a relevant and practical subject that provides a theoretical background for people to understand the world. From then on, it is purely up to the individual to use the knowledge gained to understand the real world and apply it (and even come up with solutions that will maximise people’s welfare as well as make better decisions on the whole). It is a subject that requires a lot of academic rigour, and does train an individual’s critical thinking and decision-making skills. It is certainly not a subject that is irrelevant. In fact, even though people do criticise economists for failing to predict economic events correctly, they have actually done a great job in predicting its direction. As I quote Keynes, "it is always better to be vaguely right than to be exactly wrong".
Hence, I challenged those who wants to understand our world (in terms of politics, economics, finance, environment and social) to study economics. It is indeed a discipline that will open up boundaries, which you have never imagined, possible, as well as allows you to understand policies and make better decisions in your life.
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