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What is economics?

Economics is a social science concerned with the factors that determine the production, distribution and consumption of goods and services. It studies how individuals (such as families or firms) and societies make choices on allocating limited resources to satisfy their wants, needs and greeds. The term economics comes from the Ancient Greek word oikonomia which literally means "the management of a household", referring to material wealth. Thus, political economy or economic science was so named because it was originally intended to discover what role politics plays in the economy. Today, economists use tools from mathematics, statistics, and computer science to analyze industrial organizations, banks, financial markets and almost every other facet of human society.

Economic analysis is applied throughout business management , finance , public policy and international relations , thus economics has a pervasive influence on how individuals make decisions in their personal lives as well as in their workplace or government decision-making processes. The Nobel Memorial Prize in Economics was established by Sveriges Riksbank to honor certain outstanding works in economics each year.

Branches of economics

There are many branches of economics that you can ask for economics homework assistance at Tutlance. These include:

  • Macroeconomics: Macroeconomics studies national or regional output (GDP) as well as interest rates, inflation, unemployment and economic growth . It focuses on aggregate variables like national income, employment level, inflation rate etc...
  • Microeconomics: Microeconomics studies decision making by individuals and firms to understand how prices are determined. It uses game theory models to describe interactions among people who have incomplete control over their choices because they take place under conditions of scarcity . For example it analyzes how individuals make decisions about what quantity of a good to purchase given that there are constraints on his or her income .
  • Development economics: Development Economics studies how economic changes affect people in developing countries or in poor areas . Development economics is also known as "growth economics" and it was founded by Alexander Gerschenkron (1904–1978). He stressed that in less developed countries these processes were different from the ones found in more advanced economies, so generalizing assumptions about economic development would not be appropriate.
  • Business Economics: Business economics studies how companies organize themselves in order to maximize profits. For instance through management techniques or marketing methods. This subfield considers decisions regarding inputs (materials), processes (manufacturing), outputs (goods) and distribution developed by business owners and managers . It aims at finding optimal ways for organising production, producing assets cheaper yet better quality products. This means focusing on efficiency without regard to other social considerations.
  • Competition Economics: Competition Economics can be seen as a response to the monopoly power of large corporations when they are able to control prices. This discipline studies how competitors succeed when consumers have multiple options available to them , thus analyzing current business strategy and rewarding organizational structures .
  • Financial Economics: Financial Economics deals with aspects like the determination of the value of stocks and shares , options, mortgage loans etc. The finance sector is becoming increasingly important in today's economy, which makes this branch to be an interesting topic for study for many college students.
  • Economic history: Economic history uses historical methods to analyse economic developments over time and place (especially regarding the impact on social change). Economic history differs from economic theory in that it stresses the importance of taking into account the political, social and cultural aspects as well as morality. On this background, Adam Smith, an economist who is known today as "the father of modern economics" saw his discipline as a moral science whose goal was to use markets to promote prosperity, happiness and peace around the world.
  • Game theory: Game theory is a branch of applied mathematics which analyzes the interactions between strategic actors. It assumes that they have incomplete information and apply different forms of reasoning to anticipate their opponents' actions . A game is a situation where two or more people choose strategies from a set of available options in order to maximize gains and minimize losses .
  • Economic systems: Economic systems are social arrangements for allocating economic goods to people and social groups. Economic systems possess a number of core components that generally include: property rights, capital allocation, resource management, production processes and incentives / rewards for people from engaging in economic exchanges .
  • Econometrics: The goal of econometrics is to use mathematics and statistics to solve real-life economic problems. As such, it is sometimes called applied economics . It uses econometric methods to time series or cross sectional data in order to estimate models and test hypotheses about the relationship between economic phenomena .
  • Economics of education: Economics of education studies the process of production and consumption of educational services. The branch analyses how educational services are produced, their costs , who pays for them and how they are distributed. It also studies the demand for education by students .
  • Behavioral economics: Behavioral economics is an interdisciplinary field based upon psychology and economics. It aims to explain economic behavior in terms of the psychological traits of individuals rather than theories or models.
  • Public economics: Public economics is the application of microeconomic theory to government policy. It looks at welfare distribution, tax incidence , stabilization policy, positive and normative analysis in public finance .
  • Political economy: This discipline studies how economic forces determine social institutions as well as political systems.
  • Economic geography: Economic geography is a branch that examines relationships among countries and regions, focusing on the distribution of an economy's activities across space (land). For example, economic geography can study how cities are formed and why people choose to live in certain areas. It also considers whether regions develop independently or dependently of each other as well as interdependence between various economies.
  • Urban economics: Urban Economics is the study of how people act in urban environments. It focuses on factors like population distribution, residential location choice, education and transportation networks.
  • Environmental Economics: Environmental economics deals with the link between economics and caring for the environment. It emphasizes on green growth, doing less environmental damage and using natural resources efficiently. By studying these issues we aim at finding ways of overcoming our current environmental problems such as pollution, depletion of natural resources , biodiversity loss etc...
  • Economic Policy: Economic policy is about choosing between alternatives available to government policy makers : increase spending or decrease taxes? Do we prefer Keynesianism over Monetarism? What are the pros and cons of free market capitalism? ... This study not only focuses on economic questions but also evaluates political issues such as legal problems, institutional structures etc. The reason why economists have been trying to answer these questions from Aristotle (384-322 BC) until today is because they want to understand how markets and governments can respond adequately in order to achieve social and economic balance.
  • International Economics: International economics is a branch of economics that studies the factors that determine , for instance, the demand and supply of goods and services in different countries. For example, a country's international trade balance depends on its national saving level , which in turn reflects its investment level , which implies a certain amount of foreign assets .

As you can see, there are many branches of economics that you can get help with. Ask for help with economics assignments in any of the above topics.

Economic systems, models and theories

The study of economic systems encompasses how knowledge is created as well as distributed. In this field, an economic system can be seen as a functioning social system which includes at least one market mechanism . It has been defined as the science or branch of political economy that analyzes the production, distribution, and consumption of goods and services in an environment where authority (rules) is limited to the state. The term "economic system" was first introduced by Karl Polanyi (1886–1964), who stated that the "study of economic phenomena occurs in a setting of institutions; practices, conventions and rules". Since then there have emerged many subfields which attempt to explain the functioning of an economic system below.

Economic models and theories attempt to summarise and formalize around a few rules or laws so that these can be put forward as axioms. The aim is to construct a clear image of cause and effect, which implies that it must include assumptions about human behavior (e.g. individuals acting in their own rational interest).

A variety of such theories exist, like for instance: Keynesian Economics, Monetarism, Supply -side economics, Classical economics, Marxism, Institutional economics.

Economic systems can be divided into three major categories: command economies, market economies and mixed economies.

Command economic systems are based on planning decisions of government officials whereas market economic systems are based on individual decision making through markets.

In a mixed economies , decision making is shared between the state and markets.

Elements of an economy can include commodities, natural resources, capital goods, financial institutions and human resources.

In capitalist systems , all or nearly all of the means of production are owned either privately by individuals or corporations, which gives them exclusive rights to possessions and enables

Study of Economics as a science

In modern usage, "economics" refers mainly to the study of economic policies relating to government or public policy. In this sense it is synonymous with political economy. However, some economists also use "economics" in a broader sense – emphasizing wanted characteristics – such as efficiency growth , distribution, and innovation. This is the conception of economics which has become dominant in mainstream economics in recent years, with theoretical contributions coming from many schools, including figures like Friedrich Hayek, Milton Friedman and John Maynard Keynes

Though there are various forms of economic thought that can be identified (i.e. classical political economy, neoclassical political economy), the main subject today is neoclassical economics through which economists develop theories about how to achieve efficient allocation of resources or market equilibrium. Such allocation was initially viewed as being achieved by supply and demand working together in response to price signals for goods and labour; however later developments focused on information problems rather than changing prices i.e., "market failure".

Economics arose alongside the Industrial Revolution as a social science that analyzed the efficiency of productive techniques and what effects they had on society

Why study economics in college?

Economics is a social science that studies people's economic behavior. Economics helps us understand the way people make decisions about buying, selling, and investing. That means it can help you to make better decisions about your money. Understanding economics helps us to be more informed citizens.

Studying economics means mastering the tools of economic analysis which will equip students for careers in business, finance, government or policy making, law, public administration and many other fields.

Economics is like a telescope and microscope which helps us explore how the economy works. Using math, statistics, graphs, and computer models we can make predictions about economic events. Economics is a social science that uses scientific methods to describe what people do by treating them as though they are rational actors trying to achieve their goals. This is different from other social sciences like sociology which studies the actions of people in groups.

Like gravity or inertia, economics is not a choice. Governments and people may wish that certain things would happen but they don't just happen. There are consequences to what happens whether we want them to occur or not learning these consequences will help you make better decisions about your money.

Economics is the science of scarcity. Economics studies how people manage limited resources to fulfill their unlimited wants. You will find economics in every aspect of your life whether it's decisions about buying food, buying a car, or choosing what movie to see. Every decision involves trade-offs and economic concepts like opportunity cost can help you make better decisions about your money.

You may have been told that economics is the study of money and banking, but don't be fooled it's much more than that.

Economics explores questions like:

  • What determines how many jobs there will be?
  • Why do people save some of their income and spend the rest?
  • How should we measure economic progress over time?

Economics has a number of branches including:

  • Microeconomics, which looks at the behavior of individuals and firms.
  • Macroeconomics, which looks at economy-wide events such as recessions or growth.
  • International economics which deals with trade between countries.
  • Development economics explores why some nations are rich and others are poor.
  • Environmental economics looks at how we can best protect our natural resources.

Economics Study Resources:

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Economics is the study of resource allocation, distribution and consumption, capital and investment, and of management of the factors of production.

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