Nature of Economics

Nature of Economics, Subject matter of economics, Concept of positive and normative economics and micro and macro economics

Notes

Wealth and Welfare Definition of Economics

The first definition of economics was given by Adam Smith, a citizen of Scotland in 1776 A.D. Adam smith has separated economics from other social sciences and defined economics for the first time. So, he is recognized as the father of economics and leader of economics.The wealth definition of economics has been further explained using following properties. -study of Wealth -Secondary Place to Mankind -.Source of Wealth -Study of Economic-Man

Scope of Economics

Scope means an area of study or coverage of particular subject.Scope of economics means area covered by subject economics i.e. the whole topics which should be studied in economics. The scope contains two headings. The subject matter of economics is studied with the help of following three points: i. On the basis of definition ii. Traditional approach iii. Modern approach.

Micro & Macro and Positive & Normative Economics

The subject matter of economics has been divided into two parts: Microeconomics and Macroeconomics. The terms 'micro' and 'macro' are derived from two greek words 'mikros' And 'makros' respectively. The word 'mikros' means small And the word 'makros' means large. Microeconomics studies the behaviour of an individual economic unit whereas macroeconomics studies the behaviour of economic as a whole.

Scarcity Definition of Economics

The third or modern definition of economics was given by Lionel Robbins in the decade of 1930s. Robbins was the citizen of British and professor at London School of Economics. He is one of the modern economists who shifted the focus of economics from welfare aspect to scarcity and choice. In 1932 A.D he wrote a book entitled "An Essay on the Nature and Significance of Economic Science" and defined economics in terms of scarcity and choices.