Category: Economics, Finance, and Political Economy

HOW DO WE DEFINE ECONOMICS? IT TOOK TIME…

Adam Smith (1776) defined what was then called political economy as “an inquiry into the nature and causes of the wealth of nations”, in particular as:

—“a branch of the science of a statesman or legislator [with the twofold objectives of providing] a plentiful revenue or subsistence for the people … [and] to supply the state or commonwealth with a revenue for the publick services.”—

John Stuart Mill (1844) defines the subject in a social context as:

—“The science which traces the laws of such of the phenomena of society as arise from the combined operations of mankind for the production of wealth, in so far as those phenomena are not modified by the pursuit of any other object.”—

Alfred Marshall provides a still widely cited definition in his textbook Principles of Economics (1890) that extends analysis beyond wealth and from the societal to the microeconomic level:

—“Economics is a study of man in the ordinary business of life. It enquires how he gets his income and how he uses it. Thus, it is on the one side, the study of wealth and on the other and more important side, a part of the study of man.”—

Lionel Robbins (1932) developed implications of what has been termed “Perhaps the most commonly accepted current definition of the subject”:

—“Economics is a science which studies human behaviour as a relationship between ends and scarce means which have alternative uses.”—

Gary Becker, a contributor to the expansion of economics into new areas, describes the approach he favours as :

—The study of human behavior by “Combining i) the assumptions of maximizing behaviour, ii) stable preferences, and iii) market equilibrium, used relentlessly and unflinchingly.”—

I’m pretty obviously a Beckerian in that I see economics as a methodology applied to the science of studying demonstrated behavior, and the application of physics to life forms that (a) have memories, (b) consciousness, and (c) the possibility of cooperation.

I see economics as an extension of physics into conscious life. And I see p-law as the logic of invariance from the physical, natural, and evolutionary laws.

I see Physics, Economics, Law, and evolutionary necessity as the hierarchy of laws of nature.