What is Economics?

Economics is a social science dedicated to the general study of economic activity. It explores the nature of scarcity and seeks to explain how the lack of something creates a demand, and thus a supply for it. This is accomplished through examining the behavior and interaction of economic agents as a means to gain a better understanding of the processes that govern economies.

The field is divided into two areas of study: microeconomics and macroeconomics. Microeconomics examines individual markets and agents, whereas macroeconomics examines the entire economy and the global issues affecting it. The fundamental difference between the study of macroeconomics and the study of microeconomics is a matter of scale: like looking at an overall painting versus looking at a single brush stroke and how it interacts with other brush strokes to define the painting.

Economics carries with it certain viewpoints. As it is not a traditional science, but a social one, there is a certain amount of subjectivity. This means that several schools of economic thought have arisen, each carrying their own theoretical models and their own biases. Some examples of these various schools of thought include neoclassical economics (traditional capitalism), more radical, heterodox economics (Marxism), and labor based economics (Keynesian economics). Because economics focuses more on the development of theory and argues more hypothetical models than empirical ones, an essay in this subject will tend to resemble that of an essay in the field of political science or history, relying on a standard argumentative format.