What Is Economics? Why Is It Important?
Read this section to learn about the basic problem of scarcity and the study of economics. Be sure to click through to read each of the pages in this section. As you read, reflect on the things that society needs and the resources that are needed for production like natural resources, money, labor, etc. Every society needs to take into account the problem of scarcity, and that decisions are needed to choose from producing one thing over another. An example is choosing between having a natural wild environment by not developing a piece of land, or developing that land for housing.
Why Study Economics
Now that we have gotten an overview on what economics studies, let's quickly discuss why you are right to study it. Economics is not primarily a collection of facts to be memorized, though there are plenty of important concepts to be learned. Instead, economics is better thought of as a collection of questions to be answered or puzzles to be worked out. Most important, economics provides the tools to work out those puzzles. If you have yet to be been bitten by the economics "bug," there are other reasons why you should study economics.
- Virtually every major problem facing the world today, from global warming, to world poverty, to the conflicts in Syria, Afghanistan, and Somalia, has an economic dimension. If you are going to be part of solving those problems, you need to be able to understand them. Economics is crucial.
- It is hard to overstate the importance of economics to good citizenship. You need to be able to vote intelligently on budgets, regulations, and laws in general. When the U.S. government came close to a standstill at the end of 2012 due to the "fiscal cliff," what were the issues involved? Did you know?
- A basic understanding of economics makes you a well-rounded thinker. When you read articles about economic issues, you will understand and be able to evaluate the writer's argument. When you hear classmates, co-workers, or political candidates talking about economics, you will be able to distinguish between common sense and nonsense. You will find new ways of thinking about current events and about personal and business decisions, as well as current events and politics.
The study of economics does not dictate the answers, but it can illuminate the different choices.