Economics

‘The study of the general methods by which men co-operate to meet their material needs’ (Sir William Beveridge); ‘the study of mankind in the ordinary business of life’ (A. Marshall); ‘a science which studies human behaviour as a relationship between ends and scarce means which have alternative uses’ (L. Robbins); ‘Economics investigates the arrangements between agents each tending to his own maximum utility’ (F.Y. Edgeworth); ‘Wants, Efforts, Satisfaction - this is the circle of Political Economy’ (Frederic Bastiat); ‘Not a gay science … what we might call … the dismal science’ (Thomas Carlyle).

First discussed by the Ancient Greeks, and the subject of general textbooks since the eighteenth century, economics has changed its focus as the concerns and techniques of its practitioners have developed. Originally the word meant ‘household management’ as the household was the basic economic unit of the time, including both farming and manufacturing activities. But the Greeks also, to their credit, raised the basic issues of value, the nature of money and the division of labour.

The word ‘économistes’ was first used by the French physiocrats in the 1760s and in that century cantillon and smith produced the first comprehensive treatises on the subject. Smith, and his classical disciples, produced theories of growth, value, distribution and taxation. cantillon, the physiocrats and ricardo introduced model building into economics. Although methodological debates were present in the subject as early as John Stuart mill and senior, particularly in the standard debate about deduction and induction, it was dupuit, the marginalists and edgeworth who first encouraged a mathematical treatment of economic theory.

From CREDO Economics: Routledge Dictionary of Economics

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