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Introduction to Economics
Dr. R. Kurinji Malar
Assistant Professor,
PG & Research Department of Economics,
Sacred Heart College (Autonomous,
Tirupattur-635 601, Tamil Nadu, India
• Economics is a social science that studies how
individuals, businesses, governments, and
societies allocate scarce resources to satisfy
unlimited wants and needs.
• It examines how people make choices and
decisions in various economic activities, such as
production, consumption, and distribution of
goods and services.
• The field of economics can be broadly divided
into two main branches: microeconomics and
macroeconomics.
Microeconomics
• Microeconomics focuses on the behavior and
interactions of individual economic agents, such as
consumers, firms, and workers.
• It analyzes how these agents make decisions
regarding what to produce or consume, how to
allocate resources, and how prices are determined
in specific markets.
• Microeconomics also studies concepts like supply
and demand, market structures, consumer behavior,
and production theory.
Macroeconomics
• Macroeconomics, on the other hand, deals with the
overall functioning and behavior of the economy as
a whole.
• It examines aggregate variables such as national
income, unemployment rates, inflation, economic
growth, and the overall level of prices.
• Macroeconomists study the factors that influence
these variables and develop theories and models to
understand and analyze the performance of the
economy.
• Economics utilizes various analytical tools and
methods to study economic phenomena.
• These include mathematical and statistical
techniques, economic models, and empirical
analysis.
• Economists often conduct research, collect and
analyze data, and use economic theories to
provide insights and recommendations on
economic policy and decision-making.
Sub-disciplines of Economics
Economics has several sub-disciplines that focus on specific
areas of economic activity.
 Labor economics
 International economics
 Development economics
 Environmental economics
 Financial economics
 Behavioral economics
Each sub-discipline applies economic principles and
methods to explore specialized topics within the broader
field of economics.
• Economics has real-world applications in areas
such as business, finance, public policy, and
international relations.
• It helps policymakers and individuals
understand the consequences of different
economic choices, design effective policies,
and make informed decisions in an ever-
changing economic environment.
Meaning of Economics
• Economics is a social science that studies how
individuals, businesses, and governments
allocate scarce resources to satisfy unlimited
wants and needs.
• It explores the production, distribution, and
consumption of goods and services, and how
they interact in various economic systems.
Definition of Economics
"Economics is the social science
that studies how individuals,
businesses, and societies make
choices about the allocation of
scarce resources to satisfy
unlimited wants and needs“.
Nature and Scope of Economics
Social Science: Economics is a social science that employs
scientific methods to study human behaviour related to the
production, distribution, and consumption of goods and
services.
• It seeks to understand how individuals, households,
businesses, and governments make economic decisions and
interact in various economic systems.
Scarcity and Choice: Economics recognizes that resources are
limited, while human wants and needs are unlimited.
• It explores how individuals and societies make choices in
allocating scarce resources to fulfill their diverse needs and
desires.
• This analysis includes understanding trade-offs, opportunity
costs, and efficient resource utilization.
Microeconomics: Microeconomics focuses on individual
economic units, such as consumers, firms, and markets.
It examines their decision-making processes, the
interaction between supply and demand, price
determination, market structures, and the efficiency of
resource allocation at a smaller scale.
Macroeconomics: Macroeconomics studies the overall
behaviour and performance of an entire economy.
It analyzes aggregate variables such as national income,
employment, inflation, and economic growth.
Macroeconomics explores topics such as fiscal and
monetary policies, international trade, unemployment,
and economic fluctuations.
Economic Systems: Economics explores different
economic systems, including market economies,
command economies, and mixed economies.
It investigates how these systems organize and
coordinate production, distribution, and consumption
activities.
Policy Analysis: Economics provides tools and
frameworks for analyzing and evaluating economic
policies.
It examines the potential impact of policies on
resource allocation, income distribution, market
efficiency, and overall economic welfare.
It aims to provide insights and guidance for
policymakers in making informed decisions.
Interdisciplinary Approach: Economics interacts with and
draws upon various other disciplines such as sociology,
psychology, political science, mathematics, and statistics.
It incorporates insights from these disciplines to enhance
the understanding of economic phenomena and to develop
more robust models and theories.
International Economics: Economics explores the
interaction of economies at the global level.
It examines international trade, exchange rates,
globalization, economic development, and the effects of
economic policies across countries.
It addresses issues related to international economic
integration and cooperation.

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Introduction to Economics Dr. R. Kurinji Malar.pptx

  • 1. Introduction to Economics Dr. R. Kurinji Malar Assistant Professor, PG & Research Department of Economics, Sacred Heart College (Autonomous, Tirupattur-635 601, Tamil Nadu, India
  • 2. • Economics is a social science that studies how individuals, businesses, governments, and societies allocate scarce resources to satisfy unlimited wants and needs. • It examines how people make choices and decisions in various economic activities, such as production, consumption, and distribution of goods and services. • The field of economics can be broadly divided into two main branches: microeconomics and macroeconomics.
  • 3. Microeconomics • Microeconomics focuses on the behavior and interactions of individual economic agents, such as consumers, firms, and workers. • It analyzes how these agents make decisions regarding what to produce or consume, how to allocate resources, and how prices are determined in specific markets. • Microeconomics also studies concepts like supply and demand, market structures, consumer behavior, and production theory.
  • 4. Macroeconomics • Macroeconomics, on the other hand, deals with the overall functioning and behavior of the economy as a whole. • It examines aggregate variables such as national income, unemployment rates, inflation, economic growth, and the overall level of prices. • Macroeconomists study the factors that influence these variables and develop theories and models to understand and analyze the performance of the economy.
  • 5. • Economics utilizes various analytical tools and methods to study economic phenomena. • These include mathematical and statistical techniques, economic models, and empirical analysis. • Economists often conduct research, collect and analyze data, and use economic theories to provide insights and recommendations on economic policy and decision-making.
  • 6. Sub-disciplines of Economics Economics has several sub-disciplines that focus on specific areas of economic activity.  Labor economics  International economics  Development economics  Environmental economics  Financial economics  Behavioral economics Each sub-discipline applies economic principles and methods to explore specialized topics within the broader field of economics.
  • 7. • Economics has real-world applications in areas such as business, finance, public policy, and international relations. • It helps policymakers and individuals understand the consequences of different economic choices, design effective policies, and make informed decisions in an ever- changing economic environment.
  • 8. Meaning of Economics • Economics is a social science that studies how individuals, businesses, and governments allocate scarce resources to satisfy unlimited wants and needs. • It explores the production, distribution, and consumption of goods and services, and how they interact in various economic systems.
  • 9. Definition of Economics "Economics is the social science that studies how individuals, businesses, and societies make choices about the allocation of scarce resources to satisfy unlimited wants and needs“.
  • 10. Nature and Scope of Economics Social Science: Economics is a social science that employs scientific methods to study human behaviour related to the production, distribution, and consumption of goods and services. • It seeks to understand how individuals, households, businesses, and governments make economic decisions and interact in various economic systems. Scarcity and Choice: Economics recognizes that resources are limited, while human wants and needs are unlimited. • It explores how individuals and societies make choices in allocating scarce resources to fulfill their diverse needs and desires. • This analysis includes understanding trade-offs, opportunity costs, and efficient resource utilization.
  • 11. Microeconomics: Microeconomics focuses on individual economic units, such as consumers, firms, and markets. It examines their decision-making processes, the interaction between supply and demand, price determination, market structures, and the efficiency of resource allocation at a smaller scale. Macroeconomics: Macroeconomics studies the overall behaviour and performance of an entire economy. It analyzes aggregate variables such as national income, employment, inflation, and economic growth. Macroeconomics explores topics such as fiscal and monetary policies, international trade, unemployment, and economic fluctuations.
  • 12. Economic Systems: Economics explores different economic systems, including market economies, command economies, and mixed economies. It investigates how these systems organize and coordinate production, distribution, and consumption activities. Policy Analysis: Economics provides tools and frameworks for analyzing and evaluating economic policies. It examines the potential impact of policies on resource allocation, income distribution, market efficiency, and overall economic welfare. It aims to provide insights and guidance for policymakers in making informed decisions.
  • 13. Interdisciplinary Approach: Economics interacts with and draws upon various other disciplines such as sociology, psychology, political science, mathematics, and statistics. It incorporates insights from these disciplines to enhance the understanding of economic phenomena and to develop more robust models and theories. International Economics: Economics explores the interaction of economies at the global level. It examines international trade, exchange rates, globalization, economic development, and the effects of economic policies across countries. It addresses issues related to international economic integration and cooperation.