• The contemporary term “economics” comes from the Greek word “oikonomos,” which means “steward.” The two halves of this word, “Oikos,” which means “home,” and “nomos,” which means “manager,” sum up economics. How do we run our household, and what kind of stewardship account can we give to our homes and the country? Economics is a broad theory of how society functions.
  • A prominent classical economist, Alfred Marshal, defined economics as “the study of man in his regular business of life.” This, however, is an overly broad description. This is because any definition should take into account the governing principle of economics, which is scarcity.
  • As defined by the great American economist Paul Samuelson: “The study of how people and society choose to use scarce resources that could be put to other uses to produce various commodities and distribute them for consumption among multiple individuals and groups in society, now and in the future.
  • According to the definition of scarcity in economics, all resources are scarce because there aren’t enough to satisfy everyone’s wants to the point of satiety. As a result, another feature of economics is that it involves choice. Human desires are limitless.
  • Economics is the branch of knowledge concerned with the production, consumption, and transfer of wealth.
  • Economics can be described as “the social science concerned with the allocation of scarce resources to provide goods and services that suit the requirements and wants of customers”
  • Lionel Robbins defined economics as “the science which studies human behaviour as a relationship between (given) ends and scarce means which have alternative uses.”
  • The economist restricts the research by focusing on four critical aspects of human existence and examining what occurs when they are all found together, as they frequently are:-
  1. Human beings have limitless desires.
  2. Those desires are of varying degrees of importance.
  3. The resources available to fulfill such desires — human time, energy, and material resources – are scarce.
  4. The means can be put to various uses, i.e., they can be employed to make various things.
  • However, the economist isn’t interested in any one characteristic in isolation. On the contrary, an economic problem arises only when all four traits are present together.
  • Resources are the materials that economists mix to create economic commodities, which are scarce in relation to demand.
  • There are two types of resources:-
  1. Economic Goods: Economists group all items that people seek together and call them economic products, which are scarce in accordance with demand.
  2. Free goods: These are goods that people can have in unlimited quantities, such as air.
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