SCOPE AND NATURE OF ECONOMICS
:NATURE AND SCOPE OF ECONOMICS
Economics like other social subject has no specific definition because there are economists that see the subject from different views., they may be interested in different aspect of Economics such as Monetary Economics, Industrial Economics, Business Economics, Welfare Economics, Micro Economics, Macro Economics e.t.c. They therefore define Economics to reflect their interest. Examples are:
1.Prof. A.C. Piqou: In his book, the economics of welfare, defined economics as the study of human actions in relations to materials or economic welfare.
2.Alfred Marshal: Economics is the study of mankind in other business of life.
3. Adams Smith: He defined economics as an enquiry into the nature and causes of wealth of nations . Adam Smith is regarded as the father of economics theory.
4.H.J Davenport: He said economics is the science that treat phenomena from the standpoint of price”.
6.J.S Mills: In his own contribution, J.S Mills defined economics as a practical science of production and distribution of wealth. He was interested in wealth and distribution of wealth.
7. Pro Lionel C. Robbins (1932): Economics is the science study human behavior as a relationship between ends and scarce means which have alternative uses. It is the most widely accepted definition of economics.
SCOPE OF ECONOMIC ACTIVITIES PRODUCTION
Production can be defined as the conversion of raw materials into finished goods and their distribution to the final consumers in order to satisfy their wants it can also be defined as creation of utility. In production producers allocate its resources so as to get maximum profit out of his production
Distribution is defined as the movement of goods from the manufacturer to the final consumer. National incomes are distributed among the factors of production like land, labour, capital and entrepreneur.
Consumption is the final use of goods and services provided by a firm. It explains the demand of consumers regarding goods and services to derive the maximum satisfaction.
It explains buying and selling of goods and how the price of goods are determined by perfect competition, monopoly, monopolistic, oligopoly and duopoly, public finance
STAGES OF PRODUCTION
Primary production: This is the first stage of production. It involves the extraction of raw materials from the soil and Sea. -Primary production includes fishing, mining, quarrying e.t.c
-Secondary production: This involves the conversion of basic raw materials or semi-finished goods into their final stage in which utility is created. At this stage raw materials are processed and transformed into finished goods. For example, cotton is processed into textile. Other products of this stage are motor cars ships and books.
-Tertiary production: This stage covers the provision of commercial and professional services. Tertiary production ensures that goods and services are made available to the final consumers. It includes the services of doctors, teachers, retailer and entertainers. Tertiary production also involve transportation, communication, insurance, e.t.c
WHY DO WE STUDY ECONOMICS ?
Allocation of resources
Development of programs
Preparation of budget
Solution to economic problem
Provision of basic tools
Maximization of profit
Satisfaction of wants
Consumption of commodities
Participation in government
ECONOMICS AS A SCIENCE
WHAT IS SCIENCE?
Science is a systematized body of knowledge which is ascertained by observation and experiment which as the following attributes:
SCIENCE HAS LAWS AND THEORY: This can be tested through observation and experimentation. Is economics then a science? Yes ,It is a science because it has laws and theories which establish relations between causes and effect and can be tested but is not subject to experimentation like pure science subject
LAWS ARE UNIVERSALLY ACCEPTED: Scientific laws are universally accepted while some laws in economics have universal accessibility e.g. the law of demand and supply.
LAWS CAN BE TESTED AND PROVED: Science is a systematized body of knowledge which can be tested and proved. Based on this economics is also a systematized body of knowledge, facts are studied, analyzed and tested in a systematic manner. E.g. theory of production.
SCIENCE USES SCIENTIFIC PROCEDURES TO ARRIVE AT VALID GENERALIZATION OF PRINCIPLES: Economics also adopt these procedures to analyze principles, underline human decision with regards to allocation of resources.
USUAGE OF SCIENTIFIC AND STATISTICAL TOOLS: science uses statistical tools for analyses. Economics is therefore a science because the method of study is scientific and statistical tools
ECONOMICS AS A SOCIAL SCIENCE
Economy has been argued to be a science because it adopts scientific method but it is not pure science. Economics can be referred to as a social science for some reason.
- It shows how man react to issues when making economic decision.
- It studies human behaviour in relation to the activities of various economic agents in the society.
- It belongs to a group of subjects called social or behavioural science e.g sociology geography etc
- Its principles helps to solve real-world problems.
Career opportunities in economics
There are various opportunities opened to a graduate of Economics namely...
- Civil service
- Insurance and actuarial science
- Lecturing in higher institutions of learning.
- Stock broking
- Teaching in secondary school