Economics is a fascinating and complex subject that has the power to shape the world we live in. From the way we buy groceries to the policies that govern entire nations, economics plays a critical role in every aspect of our lives. Are you interested in the know-how of national and international economies? Want to delve deeper into how economies work? Then think of pursuing your higher studies in economics subject.
At its core, economics is the study of how individuals, businesses, and governments allocate resources to satisfy their needs and wants. It encompasses everything from basic concepts like supply and demand to complex macroeconomic theories that can have a profound impact on global financial systems.
One of the most exciting aspects of economics is the way it constantly evolves and adapts to new challenges and opportunities. As technology advances and the global economy becomes increasingly interconnected, economists are constantly exploring new ideas and developing new models to help us make sense of the world around us.
So, if you’re ready to dive into the fascinating world of economics, strap in and get ready for a wild ride. Whether you’re a seasoned pro or a curious beginner, there’s something for everyone in this endlessly fascinating economics subject.
What is covered in this post?
To make it easier for you, we have created a quick guide to everything you need to know about economics subject.
Before we move further, let’s understand…
What is economics?
Economics is a social science that studies how individuals, organizations, and societies allocate scarce resources to satisfy their unlimited wants and needs. It involves the analysis of the production, consumption, and distribution of goods and services.
In other words, economics is the study of how people make choices in a world where resources are limited. It examines how individuals, businesses, and governments make decisions about how to use resources such as money, time, and natural resources, to achieve their objectives. Economics is a broad subject that includes microeconomics, which focuses on the behavior of individuals and firms, and macroeconomics, which looks at the economy as a whole, including topics such as inflation, economic growth, and unemployment.
What do Economists do?
Following are some of the roles and responsibilities that an economist has to perform-
- Economists study and research the ways people, nations, and businesses utilize scarce resources (resources that are limited or in short supply) such as land, labor, raw materials, and machines to produce goods and services. They analyze the costs and benefits of distributing, producing, and consuming goods and services.
- In general terms, economists research and study how the rupee’s fluctuation against foreign currencies affects import and export markets, how government policies regarding taxes, subsidies, etc. affect the consumers, what economic activities change or influence consumer behavior, how markets change, how to solve the problem of unemployment, what economic factors affect and disturb the labor and migrants population and so on.
- They research, collect, and analyze data, monitor economic trends, and develop forecasts on topics and issues relating to energy, costs, inflation, interest rates, rents, imports/ exports, employment, GDP, and so on.
- Depending on the specialization they choose to study, Economists devise and develop methods to study the data they need. For example, economists may use sampling techniques to conduct a survey or use econometric modeling techniques to develop forecasts.
It’s time to dig a little deeper into the economics subject and know about the various branches of Economics.
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Branches of Economics
Economics subject is a diverse field of social sciences that combines sociology, politics, psychology, and history. As a branch of social science, it is primarily concerned with the behavior and relationships of people and societies and is applied to the real world to study and analyze the activities and interactions between people, markets, businesses, and governments.
Let us understand each of the branches of economics subject one by one:
Macroeconomics is the branch of economics that studies the behavior and performance of an economy as a whole, meaning it focuses on the total changes in the economy such as GDP, unemployment, national income, price indices, and the interrelations among the different sectors of the economy.
The study also focuses on questions such as: what causes unemployment? What influences or impacts growth? What causes inflation? Etc. In short, macroeconomics attempts to measure how the economy is performing to understand what factors drive it upwards or downwards.
Microeconomics is the branch of economics that studies what choices people make, what factors influence their choices, what other aspects change consumer behavior, and how their decisions affect the markets by influencing the price, demand as well as supply. It is the study of an individual’s behavior in decision-making and distribution of resources.
Behavioral Economics approach psychology and economics to explore and understand why people make irrational decisions and how their behavior does not follow the predictions of economic models. Decisions such as how much to spend on lunch, whether to go for higher education, how much money to save or invest, etc., and other decisions that most people make in their lives. Behavioral economists try to explain why consumers decided on choice A instead of choice B.
Business Economics is the field of applied economics that uses economic theory and quantitative methods to study and analyze business enterprises. Business Economists study and evaluate the business economic aspects that directly impact the growth and development of the organization. The study focuses on how and why corporations expand, what is the impact of entrepreneurs, how large corporations interact, and what is the role of governments in regulation.
Computational Economics uses advanced computer-based economic modeling for solving analytically and statistically- formulated economic problems. (Computational modeling refers to the process of mathematical modeling which is carried out on a computer to predict the behavior or the outcome of a real-world or an objective system).
Economists use advanced modeling techniques like machine learning, evolutionary algorithms, (neural) network modeling; computational aspects of dynamic systems, optimization, optimal control, games, equilibrium modeling; hardware and software developments, modeling languages, etc. to understand and solve economic problems.
Developmental Economics focuses on improving the fiscal, economic, and social state of affairs in developing countries. In simpler words, it studies the transformation or the development of emerging nations into more prosperous economies. Developmental economists determine to what extent the growing population impacts development, what is the role of education and healthcare in development, and what leads to the structural transformation of economies.
This branch of economics subject considers factors such as health, education, working conditions, national and international policies, and market conditions with a focus on boosting growth and development in developing countries.
Econometrics and Quantitative Economics
Econometrics and Quantitative Economics is a branch of economics that studies and analyses data using various statistical methods to test or develop economic theories. These statistical methods depend on statistical assumptions to quantify and analyze economic theories. This field of study uses tools such as frequency distributions, probability, correlation analysis, etc.
The initial steps in econometric methodology include obtaining and analyzing data sets and defining a specific hypothesis that further explains the nature of the set. Now, this data set can be anything: historical prices for a stock index, unemployment rate, inflated rate, or even the observations collected from a survey of consumer finances. So, if you want to understand the relationship between the annual price change of a stock and the unemployment rate or lower GDP and rising taxes, then you would collect data sets of both variables. You would first define your hypothesis and then go on to study these different data.
Political Economics is the study of how several economic theories such as capitalism, socialism, and communism work in the real world. Political economics draws on economy, law, and politics and their interdependence and how these economic theories impact, develop and influence the economy of nations. It can also be understood as the study of how a country is governed or regulated by accounting to the interests and influences of both political and economic factors.
Environmental Economics is an area of economics subject which deals with environmental issues and the relationship between the economy and the environment. Environmental economists study to determine how the economy and environmental policies influence each other.
There are environmental costs of economic growth and economists study how economic policies could act in favor of environmental policies. For example, if a state is trying to adapt to clean energy, the government can enforce a limit on carbon emissions or offer subsidies to companies that use renewable power sources.
Financial Economics is a branch of economics subject that analyses the utilization and distribution of resources in the markets in which decisions are made under uncertainty. Making financial decisions depends on numerous external factors such as time, risk, opportunity costs, etc. this branch of economics evaluates how certain factors impact decision-making.
Geo-economics also called economic geography is the study of the location, distribution, and spatial structure of economic activities all across the world. In other words, it is a combination of economic and geographic factors relating to international trade. Economists seek to find answers to questions like how geographic factors, internal and external trade, international politics, and other external factors influence the economic standing of nations.
Health Economics is concerned with the issues related to the efficiency, effectiveness, value, and behavior in both production and consumption of health and healthcare. Health economists study in determining how health outcomes and lifestyle patterns can be improved, what influences or impact health, how healthcare systems are made more economical and feasible, and so on.
Industrial Economics is the study of industries, firms, and markets. It analyses and understands the levels at which capacity, output, and prices are set; how much firms invest in research and development (R&D); and how different or similar are products from each other, etc.
Transport Economics is a branch of economics subject that deals with the allocation of resources within the transport segment. It studies the movement of people and goods over space and time.
International Economics deals with the impact on economic activity from the international differences in productive resources and consumer preferences as well as the international institutions that affect them. It studies the patterns and outcomes of trade, investment, and transactions between the residents of different countries.
Labor Economics studies the functioning and dynamics of the markets for wage labor. (Labor is a measure of the work done by humans and wage is the amount paid to them in exchange). Labor economics also studies the factors influencing the efficacy of workers, their employment between different industries and occupations, and the determination of their pay/wages.
Monetary Economics is a branch of economics subject that studies the various competing theories of money i.e. it provides a structure for analyzing money and considers its functions such as the medium of exchange, store of value and unit of account, and much more. It also studies the effects of monetary systems, including the regulation of money and related financial institutions.
Why study economics subject?
Now that you are fully equipped with the quite simple definition of economics and the numerous branches of economics subject has, let us shift our focus over the questions many students like you may have: How can you know if studying economics is right for you? Why study economics at all?
Well, the answer is simple!
At its core, Economics is the study of how individuals, groups, organizations, and entire nations manage and utilize resources. Students who go for an economics degree not only acquire the skills really needed to understand and solve complex market issues but gain strong analytical and problem-solving skills.
Take a look at some of the common skills you gain from an economics degree:
Economics subject is a broad field of social science and students graduating with an economics degree acquire an expansive set of transferable skills that are highly in demand in the workplace. Whether you want to pursue a specific career in economics or wish to take a broader approach, the skills you gain today would not only make you ready for the future of workplaces but teach you to think like an economist.
List of BA economics subjects
The Bachelor of Arts (BA) in Economics program generally covers a range of subjects related to economics, including
- Development economics
- International economics
- Money and banking
- Public economics
- Indian economic policy
- Environmental Economics
- Agricultural economics
- Labour economics
- Industrial economics
- Financial economics
- Mathematical economics
- Game theory and strategic Decision-making
- Research Methodology
The specific subjects covered may vary depending on the university or institution offering the program. However, these are some of the core subjects that are commonly included in a BA in Economics program.
Popular subjects in MA Economics
The specific MA Economics subjects in India may vary depending on the university or institution offering the program. However, some of the common subjects that are covered in MA Economics courses in India are
- Mathematical Economics
- International Economics
- Development Economics
- Monetary Economics
- Public Economics
- Environmental Economics
- Industrial Economics
- Agricultural Economics
- Game Theory
- Financial Economics
- Labour Economics
- Health Economics
Again, this is not an exhaustive list, and the curriculum may vary depending on the institution.
A career in economics has expanded enormously majorly because of globalization and rapid economic development. The growth of any business or organization as well as a nation depends upon the economic policies undertaken. As global economies are coming together, the rise in demand for economic researchers, analysts, consultants, and strategists who are well qualified to understand the changing economic trends and other forces would see an upward trend. With an economics degree, students can find a number of exciting career options to choose from. But for that, a detailed understanding of economics subject is a must!
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Economics Subject: FAQs
Economics is the study of how individuals, businesses, and governments allocate resources to satisfy their unlimited wants and needs.
The basic concepts in economics include supply and demand, opportunity cost, marginal analysis, elasticity, and market structures.
Studying economics provides individuals with a better understanding of how the economy works and how individuals and governments can make better decisions to allocate resources effectively.
Some common misconceptions about economics include that it is all about money, that it is solely focused on stock markets and investments, and that it is a purely theoretical subject with no practical application.
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Anushree has 5 years of experience in the career counseling industry as a Senior Content Writer. She has also worked as a Social Media Marketing Expert for a startup and Content Quality Analyst for the Publishing and E-learning Industry. She has done her Master’s in Commerce and PGDM in Finance & Trade and Marketing & HR, but she is currently following her passion for writing.