Ist Week lectures
ist lecture
26th june2013
1.1 INTRODUCTION
Any discussion on a subject must start by explaining what the subject is all about i.e., by
defining the subject. In this chapter, we shall define Economics. The questions which Economics
actually discusses will then be taken up in the subsequent chapters.
The principal fact about Economics that we must always remember is that it is a social
science. If we forget this, we tend to get bogged down with questions that are not relevant to
Economics and are best left to other disciplines.
1.2 MEANING OF ECONOMICS
The word ‘Economics’ originates from the Greek work ‘Oikonomikos’ which can be divided
into two parts:
(a) ‘Oikos’, which means ‘Home’, and
(b) ‘Nomos’, which means ‘Management’.
Thus, Economics means ‘Home Management’. The head of a family faces the problem
of managing the unlimited wants of the family members within the limited income of the
family. In fact, the same is true for a society also. If we consider the whole society as a ‘family’,
then the society also faces the problem of tackling unlimited wants of the members of the
society with the limited resources available in that society. Thus, Economics means the study
of the way in which mankind organises itself to tackle the basic problems of scarcity. All societies
have more wants than resources. Hence, a system must be devised to allocate these resources
between competing ends.
ist lecture
26th june2013
1.1 INTRODUCTION
Any discussion on a subject must start by explaining what the subject is all about i.e., by
defining the subject. In this chapter, we shall define Economics. The questions which Economics
actually discusses will then be taken up in the subsequent chapters.
The principal fact about Economics that we must always remember is that it is a social
science. If we forget this, we tend to get bogged down with questions that are not relevant to
Economics and are best left to other disciplines.
1.2 MEANING OF ECONOMICS
The word ‘Economics’ originates from the Greek work ‘Oikonomikos’ which can be divided
into two parts:
(a) ‘Oikos’, which means ‘Home’, and
(b) ‘Nomos’, which means ‘Management’.
Thus, Economics means ‘Home Management’. The head of a family faces the problem
of managing the unlimited wants of the family members within the limited income of the
family. In fact, the same is true for a society also. If we consider the whole society as a ‘family’,
then the society also faces the problem of tackling unlimited wants of the members of the
society with the limited resources available in that society. Thus, Economics means the study
of the way in which mankind organises itself to tackle the basic problems of scarcity. All societies
have more wants than resources. Hence, a system must be devised to allocate these resources
between competing ends.
