Uses of Economics

Images of economics

Economics is a branch of the social sciences and a required course in many colleges and universities around the world. The study of economics fosters a greater understanding of the economy as a whole, as well as of events in the news. Economics also prepares students for advanced study in business, law, government and other disciplines.

1 Identification

Economics is the study of how societies allocate scarce resources. Society's wants are unlimited, but the means for satisfying them are limited. Economists study how societies determine what to produce, how to produce and for whom.

2 Benefits

Knowledge of basic economic principles such as supply and demand strengthens students' understanding of economic activity, and of the interactions of consumers and businesses.

3 Significance

Increasingly, economic activity occurs on a global scale, with goods and services circulating among nations faster and with greater frequency. The study of economics deepens student understanding of world economic events and how they affect the domestic economy.

4 Informed Citizens

Government policy has an economic dimension to it, and actions by elected officials can have positive or negative economic consequences. Knowledge of economics provides a more sophisticated understanding of government policy and its effects.

5 News and Current Events

Economic events at home and abroad are a staple of print and broadcast news. Studying economics brings a greater understanding of events in the news and how they impact you as an individual.

  • 1 "Principles of Economics"; N. Gregory Mankiw; 2003

Shane Hall is a writer and research analyst with more than 20 years of experience. His work has appeared in "Brookings Papers on Education Policy," "Population and Development" and various Texas newspapers. Hall has a Doctor of Philosophy in political economy and is a former college instructor of economics and political science.