Nature And Scope Of Economics, What Is Economics,

NATURE AND SCOPE OF ECONOMICS

DEFINITION

In old days people used word `oikonomos`for the management of house affairs.

With the development of civilization rulers thought that `oikonomos`be extended from house to the frontiers of country.In this way `oikonomos`came to be known as political economy which is know a subject to deal with different economic affairs of a country.

 When industrial revolution took place in England in 1770 many industries came into existence.Due to this,many economic problems came up.For example,problems of unemployment,housing,transport etc.Then there was a need to study these problems systematically and it was due to this background that Economics came into existence.After this many economists wrote books on Economics and gave different definitions of Economics.

All these definitions are put in three categories:]

1.Definition of the Classical school of thought led by Adam Smith.

2.Definition of the NEO Classical school of thought led by Alfred Marshall.

3.Definition of Economics given by Loinel Robbins.

Adam smith,s Definition:

                               Adam Smith wrote a book in 1776 whose title was ``Wealth of Nation``.

In this book he discussed the word `Wealth`through its four aspects i.e;Production of wealth,consumption of wealth,exchange of wealth and distribution of wealth.This clearly means that,according to Adam Smith,``Economics is a science of wealth.``

We will discuss the word Wealth.``Wealth means goods and services transacted with the help of money.