What is Economics?

“The study of the production, distribution and consumption of wealth in human society” – The Economist’s Dictionary of Economics

Another definition of the subject comes from the economist Lionel Robbins, who said in 1935 that:

“Economics is a social science that studies human behaviour as a relationship between ends and scarce means which have alternative uses. That is, economics is the trade-offs involved when choosing between alternate sets of decisions”

In simple, Economics can be defined as the allocation of scarce resources to provide for unlimited human wants.

It is often said that the central purpose of economic activity is the production of goods and services to satisfy consumer’s needs and wants i.e. to meet people’s need for consumption both as a means of survival but also to meet their ever-growing demand for an improved lifestyle or standard of living.

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