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ECONOMICS
MEANING Economics is the social science that analyzes the production, distribution, and consumption of goods and services ECONOMIC & NON-ECONOMIC ACTIVITIES Wealth DEFINITION WELFARE DEFINITION |
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ORIGINALLY ECONOMICSWAS RELATED TO THE COLLECTION OF REVENUE FOR THE STATE
LATER AFTER THE INDUSTRIAL REVOLUTION
WEALTH WAS IDENTIFIED AS A SOURCE &
MEANS TO SATISFY HUMAN WANTS
ADAM SMITH : FATHER OF ECONOMICS DEFINED IT AS ‘ SCIENCE OF WEALTH’ ECONOMICS |
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ECONOMIC ACTIVITIES NEXT |
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STAGES OF DEVELOPING ECONOMICS AS A SUBJECT WEALTH WELFARE SCARCITY DEVELOPMENT |
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AN ECONOMY IS A SYSTEM BY WHICH PEOPLE GET A LIVING
BY : PROF BROWN
A TOTAL SYSTEM COMPRISING OF FARMS, FACTORIES,
MINES, SHOPS, ROADS, RAILWAYS, OFFICES, SCHOOLS AND
COLLEGES ETC WHICH HELP TO PROVIDE DIFFERENT KINDS OF
GOODS AND SERVICES E C O N O M Y |
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ECONOMICS
THE PRINCIPLE OF :
PRODUCTION & DISTRIBUTION OF
GOODS AND SERVICES
AND
DEVELOPMENT OF WEALTH |
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ECONOMIC DEFINITIONS CLASSIFIED INTO 4 GROUPS
WEALTH DEFINITION
WELFARE DEFINITION
SCARCITY DEFINITION
GROWTH DEFINITION
ADAM
SMITH ALFRED
MARSHALL LIONEL
ROBBINSON SAMUELSON |
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E C O N O M IC A C T I V I T Y PEOPLE ENGAGED IN ACTIVITIES RELATED TO PRODUCTION OF
SO PEOPLE ARE BUSY IN PRODUCTION
AND
OF
GOODS & SERVICES EARLIER GOODS WERE EXCHANGED FOR GOODS KNOWN AS
CONSUMPTION DISTRIBUTION BARTER
SYSTEM |
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Lesson plan eco 9 |
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THESE DON’T AIM AT ECONOMIC WEALTH
THEY ARE CONCERNED WITH
FAMILY
WELFARE
SOCIAL SERVICES
ENTERTAINMENT
etc.
NON-ECONOMIC
ACTIVITIES NON –ECONOMIC
ACTIVITY |
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PROF. K E N N E T H BOULDING TYPES
OF
ECONOMIC
ACTIVITIES ACCORDING TO |
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PRODUCTION CONSUMPTION DISTRIBUTION E X C H A N G E Types of economic activities |
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A d a m
S m i t h “AN INQUIRY INTO THE NATURE & CAUSES OF WEALTH OF NATIONS AND IS RELATED TO THE LAWS OF PRODUCTION,EXCHANGE DISTRIBUTION & CONSUMPTION OF WEALTH BOOK |
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FEATURES OF DEFINITION
STUDY OF WEALTH ONLY
ONLY MATERIAL
COMMODITIES
IGNORES AIR / WATER CAUSES OF WEALTH
IN ORDER TO INCREASE
WEALTH ,PRODUCTION OF MATERIAL GOOD
WILL HAVE TO BE
MUCH STRESS ON WEALTH
POLITICAL ECONOMY IS TO INCREASE THE RICHES OF THE ECONOMY
INCREASED |
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ignores welfare(most important)
MATERIALISTIC
LIFE NARROW
VIEW CONCEPT OF ECONOMIC MAN NO STUDY OF SCARCITY & CHOICE SECONDARY PLACE TO MAN Has a concept that man works for selfish motive , but man ‘s activities are also influenced by moral , social and religious factors Ignores SCARCITY & CHOICE
Goods & services that satisfy human wants are limited but they have several uses Explain only wealth.
Wealth is not the end. Man is given second importance
whereas WEALTH IS A MEANS To HUMAN WELFARE Next.. what is wealth ? |
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What is wealth economic 9 folder |
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Despite of certain advancement people are poor
Why is it so? Over-population. Poor nations lack natural resources. Unequal distribution of wealth The word "wealth" is often confused with "income". These two terms describe different but related things. Wealth consists of those items of economic value that an individual owns, while income is an Inflow of items of economic value If an individual has a large income but also large expenses, her or his wealth could be small or even negative. |
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-ORIENTED DEFINITION B Y IN HIS BOOK
PRINCIPLES OF ECONOMICS Economic welfare broadly refers to the level of prosperity and living standards in an individual or group of persons MARSHALL Material |
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Economist talks about his life |
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STANDARD OF LIVING |
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ECONOMICS
IS THE STUDY OF MANKIND IN THE ORDINARY BUSINESS OF LIFE,
IT EXAMINES THAT THE PART OF INDIVIDUAL & SOCIAL ACTION WHICH IS MOST CLOSELY CONNECTED WITH THE ATTAINMENT AND WITH THE USE OF MATERIAL REQUISITES OF WELL-BEING,
THUS IT IS ON ONE SIDE A STUDY OF WEALTH; ON THE OTHER & MORE IMPORTANT SIDE , A PART OF THE STUDY OF MAN : MARSHALL |
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WHAT DOES DEFINITION IMPLIES .
In the words of Marshall, "man earns money to get material welfare”.
Material welfare is having the material things that one has to have to live such as
a bed, table, chair, bedding, clothes, bathing facilities, pots pans cutlery etc |
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STUDY OF MANKIND STUDY OF MANKIND NOT WEALTH
IS ONLY A MEAN TO SATISFY STUDY OF ORDINARY MAN WHO EARNS
WEALTH & SPENDS
TO GET PROMOTION OF WELFARE IT STUDIES MATERIAL MEANS WHICH HELPS IN HUMAN WELFARE STUDY OF REAL MAN DOES NOT STUDY MAN WHO IS SELFISH BUT STUDIES
REAL MAN WHO IS INFLUENCED BY
ECONOMIC &
NON-ECONOMIC FACTORS (social, moral & religious) |
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Criticism of MARSHALL’S DEFINITION BY ROBBINS He said classification of activities into ECONOMIC & NON-ECONOMIC was improper as all activities in one way or the other have an economic value.
is vague(not clear)because it can’t be defined People generally mean material happiness (CAN’T BE MEASURED).
Mere study of material means of welfare excluding non-material means.(LIMITED STUDY)
Marshall made welfare as an
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CONTINUED….
WANT ARE ARE But they have Which are |
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LAND USE EXAMPLES AGRICULTURE SPORTS SETTLEMENTS/HOUSES PARK |
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Subject matter – WEALTH
Importance to Wealth
He said wealth is both means & end
More stress on production of wealth
Study of ECONOMIC man(always aware of his self –interest) Subject matter– WELFARE
Importance to man
Said wealth is only a mean
Stress on consumption of wealth
Study of REAL man(both economic &non-economic factors not selfish for wealth) ADAM SMITH MARSHALL |
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Gave DEFINITION OF SCARCITY
IN HIS BOOK
‘ESSAY ON THE NATURE AND SIGNIFICANCE OF ECONOMIC SCIENCE’ “ ECONOMICS IS A SCIENCE WHICH STUDIES HUMAN BEHAVIOUR AS THE RELATIONSHIP BETWEEN s AND SCARCE MEANS WHICH HAVE Lionel Robbins |
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FEATURES OF ROBBINS DEFINITION WANTS ARE
MEANS ARE SCARCE BUT THEY HAVE
MEANS ARE : ABUNDANT / SCARCE ALTERNATIVE WANTS ARE MANY BUT HOW TO SATISFY THEM WITH LIMITED MEANS FROM NUMEROUS & URGENT |
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HIS DEFINITION IS TOO WIDE – PROBLEM OF CHOICE IS NOT ONLY RELATED WITH SOCIAL BEING BUT ALSO WITH THE SADHUS
ECONOMIC PROBLEM MAY NOT ALWAYS RISE FROM
Not applicable to rich countries(all the countries who have plentiful resources don’t face problem of scarcity/
quantity) CRITICISM ONLY ABSTRACT
NOT CONCERNED WITH THIS MAKES IT THEORITICAL AND ABSTRACT Also from abundant resources & not making full or proper use of it may give rise to economic problem |
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V/S UNSCIENTIFIC
LIMITED AS MORE EMPHASIS IS ON MATERIAL MEANS OF WELFARE
MAKES JUDGEMENT- LEADS TO CONFUSION
NOT UNIVERSAL NOT APPLICABLE TO ALL THE INDIVIDUALS SCIENTIFIC APPROACH
WIDER SCOPE-IT CONNECTS ANY BEHAVIOUR WITH SCARCITY
FREE FROM ANY CONFUSION
APPLICABLE TO ALL INDIVIDUALS,GROUPS AND SOCIETY |
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M A C R O E C O N O M I C S DERIVED FROM GREEK WORD
“ MACRO ECONOMICS DEALS NOT WITH INDIVIDUAL
QUANTITIES AS SUCH ,BUT WITH AGGREGATES
OF THESE QUANTITIES, NOT WITH INDIVIDUAL INCOME BUT WITH NATIONAL INCOME , NOT
WITH INDIVIDUAL PRICE , BUT WITH PRICE LEVEL, NOT WITH INDIVIDUAL OUTPUT BUT WITH NATIONAL OUTPUT”
“MAKROS” |
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MICRO ECONOMICS
PARTICULAR FIRM PARTICULAR HOUSEHOLD INDIVIDUAL PRICE,WAGES,INCOME, INDUSTRY ETC AND IT IS THE STUDY OF |
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MICRO ECONOMICS
AND IT IS THE STUDY OF |
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G R O W T H
DEFINITION SAMUEL SON WHICH DEFINITION OF ECONOMICS DID HE GIVE? |
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MEANING OF GROWTH An in the capacity of an economy
to produce compared from
one period of time to another. INCREASE |
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DEFINITION AS GIVEN BY
ECONOMICS IS THE STUDY OF HOW PEOPLE & SOCIETY END
UP CHOOSING WITH OR WITHOUT THE USE OF MONEY,TO
EMPLOY SCARCE PRODUCTIVE RESOURCES THAT COULD HAVE
ALTERNATIVE
TO PRODUCE VARIOUS COMMODITIES
OVER TIME & DISTRIBUTING THEM FOR CONSUMPTION ,NOW
OR IN THE FUTURE ,AMONG VARIOUS PERSONS & GROUPS IN
SOCIETY
IT ANALYSES COSTS AND BENEFITS OF IMPROVING PATTERNS
OF RESOURCE ALLOCATION |
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NATURE OF ECONOMICS SCIENCE ART POSITIVE NORMATIVE WHAT IS?
WHAT WAS?
WHAT WILL BE? WHAT OUGHT TO BE ?
WHAT OUGHT TO HAVE BEEN |
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“Art is system of rules for the attainment of a given end”
- J.M. Keynes ECONOMICS AS AN ART
It means creation or application of knowledge Theory of consumption guides the consumer to obtain maximum satisfaction with the given income ( means ) EXAMPLE |
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Economics as a science
is defined as the science of
systematic body of knowledge
presents the relation ship
between the
It deals with
Observation of facts
Measurement
Explanation
And
verification |
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as a science is divided into
ESTABLISH RELATION
BETWEEN ECONOMICS IT TELLS THAT IF WE DO CERTAIN THINGS ,
SAME WILL FOLLOW WHAT SHOULD BE DONE WHAT SHOULD NOT BE DONE |
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Why study economics in About 65% is engaged in agriculture
Agriculture productivity is very low Per capita income is very low due to low capital formation Rapid population growth is a great threat to the socio-economic progress Economics is important for …Raising standard of living of the people |
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