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What Economics Is

  • Date Submitted: 04/08/2014 04:39 AM
  • Flesch-Kincaid Score: 61.7 
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Economics is a science which difficult to define. If some people are asked about what their definition of economics, they will have some difficulty in defining the subject. They will give these following opinions, “It is study of money,” “It has to do with business, profit and loss, and so forth,” “It is about how society chooses to distribute wealth,” or “It is the search for mathematical pattern that describe the movement of prices,” (Callahan, 2004). Israel Kirzner points out that even among professional economists, there are “a series of formulations of the economic point of view that are astounding in their variety.” (Kirzner, 1966, as cited in Callahan, 2004).
The word economy comes from the Greek word for ‘one who manages a household’ (Gans, King, Stonecash, & Mankiw, 2009). Household here refers to the society. Like a household, a society faces many decisions. A society must decide what jobs will be done and who will do them. For example, it needs some people to grow food, others to make clothing, and others to make shelter. Gans et al. (2009) mentioned that it is important to manage the society’s resources because the resources are scarce. Scarcity means that society has less to offer than people wish to have. Gans et al. (2009) define economics as the study of how society manages its scarce resources.
By its English word definition, Oxford Dictionary defines economics as the branch of knowledge concerned with the production, consumption, and transfer of wealth (“Definition of Economics,” 2014).
Alfred Marshall provides other definition of economics:
“Economics is a study of man in the ordinary business of life. It enquires how he gets his income and how he uses it. 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” (Marshall, 1890).
The Austrian economist Ludwig von Mises defines economics as the theory of all human action, the general science of the immutable categories of...


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