Definitions of Economics



Definitions of Economics

“In its infancy, Economics was called political Economy.”

“The aim of political Economy is to show the way in which wealth is produced, distributed and consumed.” J.B.Say

“Economics is the study of nature, causes and growth of national wealth” Adam Smith

But Adam Smith paid too much attention to wealth as if wealth was every thing. No attention was paid to man for whom wealth is really meant. No doubt, wealth is the centre of all economic activities. But it is only a mean to an end, the end being human welfare . Economics is thus regarded as a science of man rather than of wealth.

Alfred marshall (1990) shifted emphasis from production of wealth to distribution of wealth (welfare). According to him “Economics is a study of man’s action in the ordinary business of life, it enquires how he gets his income and how he uses it. Thus it is on one side a study of wealth and on the other a more important side, a part of the study of man.”

Study of man occupies the prominent place in the Economics. However, we confine our study to those of his action which relate to wealth i.e. how wealth is produced and used. How it is exchanged and distributed in the community. Thus it covers consumptions, production, Exchange- Distribution.

According to Marshal the primary object and end of Economics is the promotion of material welfare, which is part of human welfare. (Human welfare also includes political, social, religious and other activities of mankind, not amenable to quantitative measurements)

Criticism:

1. Marshall was concerned with the material goods. However non-material goods are also equally important for the promotion of human welfare. The services of teachers, doctors, lawyers, actors, singers etc are non-material goods, which have been excluded by Marshall.

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