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Economic Theory

2. ‘Means’ or resources are limited. Means are required to be used for
the satisfaction of various wants. For instance, money is an important
means to satisfy many of our wants. As stated, means are scarce (short in
supply in relation to demand) and as such these are to be used optimally.

In other words, scarce or limited means/resources are to be economized.
We should not make waste of the limited resources but utilize them very

judiciously to get the maximum satisfaction.
3. Robbins also said that, the scarce means have alternative uses. It
means that a commodity or resource can be put to different uses. Hence,
the demand in the aggregate for that commodity or resource is almost

insatiable. For instance, if we have a hundred rupee note, we can use it
either to purchase a book or a fashionable clothe. We may use it in other
unlimited ways as we like.

Let us now turn our attention to the definitions put forward by modern
economists. J. M. Keynes defined economics as the study of the
management of scarce resources and of the determination of income and
employment in the economy. Thus his study centered on the causes of

economic fluctuations to see how economic stability could be established.
According to F. Benham, economics is, “a study of the factors affecting
the size, distribution and stability of a country’s national income”.

Recently, economic growth and development has taken an important place
in the study of economics. Prof. Samuelson has given a growth oriented
definition of economics. According to him, economics is the study and use
of scarce productive resources overtime and distribute these for present

and future consumption.
In short, economics is a social science concerned with the use of

scarce resources in an optimum manner and in attainment of desired level
of income, output, employment and economic growth.
Virtually every major problem facing the world today, from global
warming to world poverty, has an economic dimension. If you are going to

be part of solving those problems, you need to be able to understand them.
Economics is crucial.

2. Microeconomics and Macroeconomics
It is hard to overstate the importance of economics to good
citizenship. You need to be able to vote intelligently on budgets,

regulations, and laws in general. A basic understanding of economics
makes you a well-rounded thinker. When you read articles about economic

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