Economics is a social science course that studies production, consumption, distribution of goods, trade and consumption of goods and services. According to the definition of economist and politician Raymond Barbar, “Economics is the science of limited resource management. Economics considers the forms in which human behavior has chosen to manage these resources. Also analyze and explain the ways in which individuals or companies allocate limited resources to meet the numerous and unlimited needs. “
The word economics comes from the Greek word oikonomia, which means household management. (oikos means house and nomos means Customary or law Which together means household rules). The current economic model is separated from the broad scope of political economics at the end of the 19th century. Economic analysis is applied to society, business, finance and government, even crime, education, family, health, law, politics, religion, social institutions, war and science.
Economics is a basic course. (Economics should be) when economics is used to make a choice. Or when subjective values are determined On the other hand, we call economics the norm. (Actual Economics) When that economy is used as a tool for making predictions and explaining the consequences when choices are made Based on the assumption And a set of observation data Any choice that arises from the use of hypotheses creates a model. Or caused by the associated observation data set Is also the norm.
Economics only pays attention to variables that can be measured. In which the subjects of economics are classified according to the content into two major branches, namely
- Microeconomics Which is interested in the behavior of basic components in the economy including Each market and economic representative (such as households, business units, buyers and sellers)
- Macroeconomics Will be interested in the economy as a whole, for example, gross supply and demand, gross unemployment, inflation, economic growth Monetary policy and fiscal policy etc.
In addition, it can be classified according to problem analysis, including - Analytical Economics Or positive economics
- Policy Economics Or the norm as it should be (Normative economics)
The main issues that economics pays attention to are resource allocation, production, product distribution, trade and competition. In principle, economic explanations will be applied to explain more and more problems related to options under scarce constraints. Or may be called an economic value assignment for that choice
In universities and business colleges of industrialized countries, most prefer to teach the theory of mainstream economics called Neo-Classical Economics. Mainstream economics will analyze “Rationality – Individuality – Balance”, in contrast to alternative economics that focus on analysis. “Institution-History-Social Structure”
The beginning of economics
Economics can be traced back to the Mesopotamian times, ancient Greece, ancient Roman, Indian subcontinent, Chinese, Persian and Arab civilization. Famous philosophers from the ancient times up to the 14th century include Aristotle, Xenophon, Chanakiya or Wissanu Kup, Emperor Qin 1, Thomas _ Aquinas, and Ibkaldun. Aristotle greatly influenced Aquineas’ work. Who have influenced later generations of savant philosophy In the 14th-17th centuries. [3] Joseph Schumming described Peter Aquinas as the person who “Closer than any other faculty to be called ‘the founder of’ economics” in the view of natural law, finance, interest and value theory.
Although the debate about trading and allocation has a long history Economics in the minds of modern people is equated to the day Adam Smith published the book “The Wealth of Nations” (The Wealth of Nations) in the year 1776 was the beginning.
Adam Smith originally called this course Political Economy (At that time there was no term for Economics. Later, the word Economy was reformed into the word Economics and became another branch of study since the year C.E. In 1870, Adam Smith was the first philosopher to suggest that the riches of the country do not depend on the treasury. But depends on the economic size Which is the concept of Gross National Product (GDP). Exports are not sure whether it will be useful. Or importing is not sure whether it will be a loss Trading may benefit both the win-win situation and the market mechanism is like an “invisible hand” which in the long run tends to adapt. Reach the balance point.
