DEFINITION OF ECONOMICS
Economic comes from Latin word (oiknomos), which means a subject which deals with
Different economic affairs of the country
ADAM SMITH DEFINITION OF ECONOMICS
Adam Smith is also Called the Father of Economics. He Defined that Economics Is a Science of Wealth
He gives four basic aspects of wealth
Production of wealth,
Consumption of wealth,
Exchange of wealth
Distribution of wealth
Alfred Marshall
His definition is as follows:
“Economics is the study of mankind in the ordinary business of life it examines that part of individual and social action which is most closely related with the attainment and with the use of material requisites of well-being.”
Criticism of Lionel Robbins on Marshall’s Definition
Economics is the science that studies human behavior as a relationship between ends and scarce means with alternative uses. In 1932 he wrote a book “ Nature and significance of economics science” in this book, he criticized Marshall’s definition on the following ground:
It does not cover all Economics Problems:
According to Marshal, in economics, we study only those living in society and their efforts for material-requisite only. He ignored a lot of problems that must be brought under discussion in economics.
COMPARISON OF OFMARSHALL’S AND ROBBINS DEFINITION OF ECONOMICS
SNO
MARSHALL
ROBBINS
1.
Social Science
Economics is a social science that studies the action and studies the action of that person living in society.
Neutral Science
Economics is neutral science, and it is a theoretical science and does not guide us in its solution.
2.
Limited Scope
He restricted the scope of economics by considering only an ordinary person and material requisites.
Wider Scope
He has the winded scope of economics. He studied the problem of society, which arises due to scarcity of resources.
6.
Corresponds to Modern Economics Theory
Economics planning up criticism of Lionel Robbins on Marshall’s Definitions, the material welfare of the community.
Does not Correspond to Modern Economic Theories
He didn’t explain modern theories because he made economic and impartial science, which is no concern with the community's welfare.
7.
Vague Definition
He has given importance to welfare. While welfare is a vague concept that is not measurable, it differs from place, time to time, and person to person.
Clear definition
It is a clear definition because each individual has to face scarcity and choice, so we can say that it is related to the realities of life.
8.
Useful Subject
He has given importance to welfare; while welfare is a vague concept that is not measurable, it differs from place, time to time, and person to person.
Not Useful Subject
His definition is not concerned with welfare and well-being. He gave importance to the analysis of human behavior.
2. Question of Moral Judgment Arises
Robbins pointed out that economics is neutral science, and we cannot make any moral judgment.
3. Economics is a Social Science: According to Marshall, a study of men as they live and move and think in the ordinary business of life. According to Robbins, the central problem of economics is that of valuation, which is one of allocation of scarce means among alternative, ends.
4. Ignore Services: Marshall has ignored all non-material services; several goods are highly conducive to human welfare.
DEFINITION OF INDUSTRIAL ECONOMICS
Industrial economics is a branch of economics that deals with the economic problems of firms & industries and their relationship with society.
In economiEconomice, it is known as ‘economics of industries,’ ‘industrial organization and policy,’ ‘business economics,’ etc.
The name ‘industrial economics’ was adopted in the early fifties (1950s)
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