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Economics is pure or applied science


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Economics is pure or applied science

  1. 1. Economics is Pure or Applied Science?A pure science furnishes tools and applied science works with these tools.Similarly, Economics as pure science, formulates various laws and appliedeconomics applies them in practice in solving various problems. Robbions and allothers before him treated economics as a pure positive science. But recently,applied economics assumed greater importance. As pure science and appliedscience go hand-in-hand, so Economics is also pure as well as applied science.The scope of economics means the limits or boundaries of Economics. Accordingto Adam Smith and A.C. Pigou Economics studies the causes of material wealth.They gave a very narrow scope to the study of economics by limiting it only tothose activities relating to wealth. According to Prof. Marshall, “Economics is astudy of economic activities of a man. It is only concerned with the wealth gettingand wealth-using activities of a man,” Prof. A.C. Pigou also restricted the scope ofeconomics to the study of economic welfare.Robbions finds the welfare definition of economics rather restrictive as it excludesnon-material things from its scope. Services of doctors, teachers, lawers, domesticservants etc. are scarce and satisfy wants in our daily life but they are non
  2. 2. material. Similarly, all economic activities are not conductive to economic welfare.For example, the activities of manufactures of liquors and opium are opposed towelfare. Economics studies how wealth is generated, exchanged, distributed andconsumed. Exchange includes determination of value of commodities, money,banking, international trade, foreign exchange etc. In distribution we study thedetermination of rent, wages, interest and profit. We study the factors thatdetermine a country’s national income, savings, investment, output andemployment and these factors promote economic growth. The growth with stabilityforms the subject matter of modern economics.