Economics ( / ˌiːkəˈnɒmɪks, ˌɛkə -/) is the study of how societies use scarce resources in the production of valuable commodities for distribution among different people. Economics focuses on the behaviour and interactions of economic agents and how economies work.
- What Is Economics?
- Understanding Economics
- Types of Economics
- Schools of Economic Theory
- Economic Indicators
- Types of Economic Systems
Economics is a social science concerned with the production, distribution, and consumption of goods and services. It studies how individuals, businesses, governments, and nations make choices about how to allocate resources. Economics focuses on the actions of human beings, based on assumptions that humans act with rational behavior, seeking the most optimal level of benefit or utility. The building blocks of economics are the studies of labor and trade. Since there are many possible applications of human labor and many different ways to acquire resources, it is the task of economics to determine which methods yield the best results. Economics can generally be broken down into macroeconomics, which concentrates on the behavior of the economy as a whole, and microeconomics, which focuses on individual people and businesses.
One of the earliest recorded economic thinkers was the 8th-century B.C. Greek farmer/poet Hesiod, who wrote that labor, materials, and time needed to be allocated efficiently to overcome scarcity. But the founding of modern Western economics occurred much later, generally credited to the publication of Scottish philosopher Adam Smith's 1776 book, An Inquiry Into the Nature and Causes of the Wealth of Nations.1 The principle (and problem) of economics is that human beings have unlimited wants and occupy a world of limited means. For this reason, the concepts of efficiencyand productivity are held paramount by economists. Increased productivity and a more efficient use of resources, they argue, could lead to a higher standard of living. Despite this view, economics has been pejoratively known as the "dismal science," a term coined by Scottish historian Thomas Carlyle in 1849.2 He used it to criticize the liberal views on race and social equality of contemporary economists like John...
The study of economics is generally broken down into two disciplines. Microeconomics focuses on how individual consumers and firms make decisions; these individual decision making units can be a single person, a household, a business/organization, or a government agency. Analyzing certain aspects of human behavior, microeconomics tries to explain how they respond to changes in price and why they demand what they do at particular price levels. Microeconomics tries to explain how and why different goods are valued differently, how individuals make financial decisions, and how individuals best trade, coordinate, and cooperate with one another. Microeconomics' topics range from the dynamics of supply and demand to the efficiency and costs associated with producing goods and services; they also include how labor is divided and allocated; how business firms are organized and function; and how people approach uncertainty, risk, and strategic game theory. Macroeconomics studies an overall e...
There are many competing, conflicting, or sometimes complementary theories and schools of thought within economics. Economists employ many different methods of research from logical deduction to pure data mining. Economic theory often progresses through deductive processes, including mathematical logic, where the implications of specific human activities are considered in a "means-ends" framework. This type of economics deduces, for example, that it is more efficient for individuals or companies to specialize in specific types of labor and then trade for their other needs or wants, rather than trying to produce everything they need or want on their own. It also demonstrates trade is most efficient when coordinated through a medium of exchange, or money. Economic laws deduced in this way tend to be very general and not give specific results: they can say profits incentivize new competitors to enter a market, but not necessarily how many will do so. Still, they do provide key insights...
Economic indicators are reports that detail a country's economic performance in a specific area. These reports are usually published periodically by governmental agencies or private organizations, and they often have a considerable effect on stocks, fixed income, and forex markets when they are released. They can also be very useful for investors to judge how economic conditions will move markets and to guide investment decisions. Below are some of the major U.S. economic reports and indicators used for fundamental analysis.
Societies have organized their resources in many different ways through history, deciding how to use available means to achieve individual and common ends.
But to understand why supply chain issues can be so difficult to fix — the equivalent of squishing one end of a balloon only to see the other end inflate — it’s worth considering a lesson from public policy expert Steven E.
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Learn all about the fields of economics, microeconomics, macroeconomics, finance, and capital markets with hundreds of videos, articles, and practice exercises. Content in this domain covers courses from high school to college and beyond.
Jul 02, 2019 · Economics is the study of the production, distribution, and consumption of wealth in human society, but this perspective is only one among many different definitions. Economics is also the study of people (as consumers) making choices about which products and goods to buy. Indiana University says that economics is a social science that studies ...
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Economics definition is - a science concerned with the process or system by which goods and services are produced, sold, and bought. See more meanings of economics.