1.

State and explain the various definitions given by various Economists.

Answer»

Note: Definition of each economist can be asked individually too.
Various definitions of economics:
1. Adam Smith:

As per Adam Smith, ‘Economics is the study of the nature and causes of wealth of nations’. As per this definition, Economics studies the exchange of physical wealth produced by labour. Adam Smith introduced economics as a Social Science. The reason for this was on one hand he studied human efforts (i.e. society) and on the other hand his methodology was scientific.

Since the time of Adam Smith, economics was studied as an independent science and not as part of general philosophy. He talked about human welfare in his book.

2. Alfred Marshall:

In his book, ‘Principles of Economics’ published in 1890, Alfred Marshall gives the following definition ‘Economics is the study of mankind in the ordinary business of life’. This definition states that in everyday life people usually aim for material well-being.

  • This definition explains economics as the study of routine activities of human beings and aims to explain how they achieve well-being from materialistic things.
  • This definition does not have a broad aspect since it only focuses on the material consumption or material wellbeing, yet it is important as it keeps human wellbeing at the centre of human activity.

3. Lionel Robbins:

  • Every field of science deals with a ‘problem’ whereas economics deals with a ‘question’. For example the questions that economics deals could be “How to allocate limited resources which have alternative uses for satisfying recurring and unlimited human wants in order to increase the wellbeing in a / society”?
  • With respect to this perspective, in 1931, Lionel Robbins in his book, ‘Nature and Significance of Economics’ gave the following definition – “Economics is the science which studies human behaviour as a relationship between limited resources and unlimited wants which have alternative uses”.
  • Human wants are unlimited and most wants keep on recurring. On the other hand, resources which help in satisfying human wants are limited and have alternate uses. Hence, the challenge for economics is to deal with the problem of allocating limited resources for satisfying enumerable human wants to the maximum level.
  • According to Robbins, economics is a positive science and does not prescribe ‘how things should ideally behave’ rather it studies, ‘how human beings behave in reality’.
  • One may think of behavior, approach and method of a person or a situation to be ‘ideal’, but in reality it is a rarity. Hence, by this definition we understand that economics does not deal with ‘norms’ i.e standard ways or patterns and so is not a ‘Normative science’.

4. Paul Samuelson:

In his book ‘Foundations of Economic Analysis’ published in 1947, Samuelson defines economics as, “Economics is the study of how people and society end up choosing, with or.without the use of money, to employ scarce productive resources that could have alternative uses to produce various commodities over time and distributing them for consumption, now or in the future, among various persons in the society. It analyses costs and benefits of improving patterns of resource allocation”.

Samuelson talks about choice, allocation of scarce resources and evaluation of costs and benefits of doing so.

Conclusion:
In general, all definitions commonly point out that economics studies human behaviour, is positive in nature, adopts scientific methods and methodologies’ and thus it is a Social Science.



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