The term economics is derived from the ancient Greek word oikonomia which means the management of household or administration. The subject of economics comes under the realm of social sciences and studies the production, distribution and the consumption of services and goods. The genesis of modern economic models lies within the broader field of political economy which emerged in the last decades of the 19th century. The stimulation behind the development of the subject of modern economics was the desire of the academicians to use an empirical approach which is more akin to the physical sciences. The primary aim of the subject of economics is to explain the working of different economies and to know the interacting procedures of economic agents. The application of economics can be in various areas which include society, finance, business, government, family, law, politics, social institutions, health, science, war and also crime. The word economic imperialism describes the expanding domain of economics in the wider social sciences during the turn of the 21st century.
Various dimensions of economics have common distinctions among themselves. The main textbook distinctions are macro and micro economics. The subject of macroeconomics addresses the issues which affect an entire economy of a nation. It includes employment, economic growth, and inflation, fiscal and monetary policy. Microeconomics on the other hand examines and describes the behavior of basic elements in an economy and includes individual markets and agents like consumers, firms, buyers, sellers etc. The other distinctions in the subject of economics include:
1. Positive economics- describes ‘what is’
2. Normative economics- advocates what ought to be
3. Applied economics- application of economics in real life situations
4. Mainstream economics- the orthodox economics which deals with the rationality-individualism-equilibrium nexus
5. Heterodox economics- the radical economics which deals with the institutions-history-social structure nexus.
6. Rational economics
7 Behavioral economics
Studying economics can be an intellectually exciting as it deals with many interesting and important subjects like inflation management, employment, national defense, economic development etc. Economics is also a growing field and its scope is constantly expanding. The subject has also successfully invaded other subjects’ areas and has established new subject areas like law and economics, public choice, economics, bio-economics, household production theory etc. Apart from being a prestigious major, it can provide a lucrative career in governments, business and in law as well. Knowledge of economics can also be of help in having a successful career in politics, consulting, Foreign Service, journalism and education.
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Two main areas of economics are
Macroeconomics
Microeconomics
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