What is Economics?
Some say Economics is the study of how to allocate limited resources between infinite wants. Others say it is the study of what to produce, how to produce it and who to produce it for. Keynes, an influential economist, said that it was not a body of knowledge, but a way of thinking. In my opinion, it is impossible to summarise Economics in a few words that do justice to how fascinating, useful and amazing it is.
I like how Tim Harford introduces Economics in “The Undercover Economist”. He says that a normal person looking at an economist wouldn’t notice anything remarkable. But to an economist, normal people look remarkable. The economist is intrigued by why normal people act the way they do and tries to understand the decisions people make. The economist tries to see how all the little decisions made by individuals add up to make huge changes in the world. Economists try to understand the world in order to solve its problems.
When you’re new to Economics, it’s different to subjects you’ve studied before. It’s like a jigsaw puzzle – there are lots of new words, diagrams and ideas that are like puzzle pieces you need to get to grips with. As time goes by you start to notice little connections here and there; how the pieces fit together. Stick with it and soon you’ll see that all the pieces are connected and when you see the big picture of how it all fits together, you will be amazed.
In short, Economics is a superpower to understand how people make decisions, to understand the cause-and-effect relationships of everyday life and to understand how we can change the world for the better.
If you are fascinated by human nature, like to think logically and want to understand the world on a deeper level, then Economics might just be the best thing that ever happened to you.
Want to find out more?
I’ve collated a list of the best resources I’ve encountered to spark a new student’s love of Economics. Download it here and enjoy the amazing journey of discovery that awaits!