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Scope of Economics. Subject Matter of Economics. Subject matter of Economics 1. Aristotle , the great thinker, says that subject matter of subject matter of Economics is economic management of state and household. Subject matter of Economics 2. Adam Smith says,
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Subject matter of Economics 1 • Aristotle, the great thinker, says that subject matter of subject matter of Economics is economic management of state and household.
Subject matter of Economics 2 • Adam Smith says, "Economics is the study of causes & wealth of nations.”
Subject matter of Economics.. 3 • But Marshall says, " Economics is a study of those activities of social beings which are connected with the the material requisites of welfare. ”
Subject matter of Economics…. 4 • Robbins further widened the subject matter. • He included in the subject matter of economics all those efforts of human beings which they undertake to acquire scarce resources to satisfy their unlimited wants. • As a result they get economic goods.
Subject matter of Economics…. 5 • Paul A Samuelson, Boulding, Leftwitch etc. relate subject matter of economics to • A) Economic activities • B) Economic Systems • C) Economic Policies
Subject matter of Economics( Kinds of Economic Activities )…7
Subject matter of Economics( Objectives of Economic Activities ) …8 • Ragnar Frisch says that economic activities have two main objectives: A) Proper allocation of resources ( subject matter of Micro Economics) B) Efficient use of resources ( subject matter of Macro Economics)
Nature of Economics Science Art Positive Normative
Is economics a science or an art ? • A science teaches us to know a phenomenon and an art teaches us to do a thing. • An art is the practical application of knowledge for achieving definite ends. • Economics is both a science and an art • It is a science because it is a systematic knowledge derived from observation, study and experimentation. • However, the degree of perfection of economics laws is less compared with the laws of pure sciences. • The study of fiscal and monetary measures to bring down inflation makes the subject of economics as an art.
Is economics a positive science or a normative science? 1 • Lionel Robbins, Senior and Friedman have described economics as a positive science. • They opined that economics is based on logic. It is a value theory only. It is, therefore, neutral between ends.
Is economics a positive science or a normative science 2 • Marshall, Pigou, Hawtrey, Keynes and. many other economists regard economics as a normative science. • According to them, the real function of the science to increase the well-being of man. • They have given suggestions in their works for promotion of human welfare. For example, Malthus has given suggestions of checking the rising population. J.M. Keynes has suggested measures to remove unemployment.
Is economics a positive science or a normative science 3 • We agree with Mr. Frazer, that an economist who is only an economist is a poor pretty fish. • An economist must come forward to give advice to the problems facing the human being like depression, unemployment, high prices, etc., for increasing his welfare. • Economics, to conclude, has both theoretical as well as practical side. In other words, It is both positive and a normative science
Limitations of Economics • Study of human activities only • Study of real man • Study of average man • Study of economic activities • Science and art • Exactness of economic laws
