Presentation on-:<br />Scarcity and its role<br />By-<br />ShubhamSinghal<br />AkashBharti<br />
Introduction-:<br /><ul><li> Scarcity means “of limited availability”. E.g.
During Famine period, food is ‘scarce’ i.e. Scarcity of food.
Scarcity is a fundamental economic problem of having humans who have unlimited wants & needs in world of limited resources.</li></li></ul><li>When will a resource be consider as ‘SCARCE’?<br /><ul><li>A resource is considered scarce when its availability is not enough to meet its demand .For e.g.
When supply of onion in market is not enough to meet the demand, that condition can be referred as Scarcity of Onions.
In arid areas, like Rajasthan, there is lack of water i.e. supply of water≠ its demand. This condition is called scarcity of water.
Moreover, in institutions, when supply of internal marks is not enough to meet the demand of students, this condition is called scarcity of Internals.</li></li></ul><li>Factors responsible for Scarcity of resources-:<br />1) Limited supply of resources (natural Scarcity)for example,<br /><ul><li>scarcity of water in arid areas like deserts,
scarcity of food in famine prone areas.</li></ul>2) Limited capabilities of technology or human skill (for example, those needed for enhanced production.)<br />3) Sometimes the insufficiencies are a result of poor planning and execution(Artificial scarcity).e.g. <br /><ul><li> In arid areas, proper planning is required for proper supply of water.</li></li></ul><li>4) But the most important factor is imbalance b/w ‘Wants’ &’Have’.<br />According to Emerson: “ Want is a growing giant whom the coat of Have is never large enough to cover.”<br />Every person needs more resources than he have.<br />e.g.<br /><ul><li>A millionaire wants more money so that he can be counted as Billionaire</li></li></ul><li>Is it Possible to Have no Scarcity?<br /><ul><li> If proper planning & techniques are used for utilization and supply of insufficient resource, then condition of its to be scarce ‘minimizes’.
If through spiritual practice and detachment you had very few desires – e.g. a monk or sannyasin then you would not see scarcity – as you would be content with just your daily bread.
If you lived on an island with abundant resources and a small population, then the scarcity of resources would be less obvious
But, in present society, most people desire more than just a loin cloth and a begging bowl. </li></li></ul><li>How to manage the condition of Scarcity-:<br /><ul><li>To manage the condition of Scarcity of resources, proper planning for supply & utilization of insufficient goods is required..This results in rise of three major economic issues:
For whom to produce?</li></li></ul><li>What, How& for whom to produce?1)What to Produce?<br /><ul><li>When making decisions about what to produce or what to consume, there is inevitably an opportunity cost. E.g.
GDP of country can be used for many purposes. However, option having highest opportunity cost will be favored.</li></li></ul><li>2)How to produce?<br /><ul><li> Use of best possible technique & planning for production of a particular resource will result in better & huge production, hence minimizing the chance of Scarcity. E.g.
Before, the introduction of Green Revolution in India, there was Scarcity of Food grains. But with the introduction of High Yielding varieties of seeds & better technique for production, production of Food grains almost doubled.</li></li></ul><li>Impact of Scarcity on Market?<br /><ul><li>If something is scarce - it will have a market value.
It will result in inflation.</li></ul>If the supply of a good or service is low, the market price will rise, providing there is sufficient demand from consumers. Whereas when there is excess supply in a market, we expect to see prices falling. For example,<br /><ul><li> If we talk about services, </li></ul>IITians vs. Engineer from UPTU colleges.<br />