Nature of Economics
Class 11 Statistics — Economics as a Science, Positive vs Normative, Economics as an Art
Economics as a Science
Systematic Study
Economics is a systematic study of knowledge and facts.
Cause-Effect Relationship
Economics deals with the correlation between cause and effect.
Universal Acceptance
All laws in economics are generally universally accepted.
A Social Science, Not a Natural Science
Despite the similarities above, economic laws are not as precise and positive as the laws of natural sciences. Therefore, economics is called a social science.
Positive vs Normative Economics
| Aspect | Positive Economics | Normative Economics |
|---|---|---|
| Focus | What are the economic problems and how they are actually solved | What ought to be — how economic problems should be solved |
| Example | India is an overpopulated country | India should not be an overpopulated country |
| Example | Prices are constantly rising | Prices should not rise |
| Nature | Descriptive — aims to make a real description of an economic activity | Prescriptive — aims to determine the ideals |
| Basis | Based upon facts | Based upon individual opinion |
| Nature of statement | Not suggestive | Suggestive |
Economics as an Art
Economics as an Art
Economics requires human imagination for the practical application of its laws, principles, and theories. Art tells us how to do things (to achieve an objective). Economics is used for achieving a variety of goals — making it an art.
Conclusion
Economics: Both Science and Art
Economics is neither just science nor just art. It is a golden combination of both — considered both a science as well as an art.