Economics and Economy
The relation between economics and the economy, simply saying, is that of theory and practice. While
the former is a discipline studying economic behaviour of human beings, the latter is a still-frame
picture of it. Economics will come out with theories of market, employment, etc. and an economy is
the real picture of the things which emerge after the follow-up to the same theories in certain areas.
Economy is economics at play in a certain region. This region is best defined today as a country, a
nation—the Indian Economy, the Russian Economy, the French Economy, etc. Economy as such means
nothing. It gets meaning once it is preceded by the name of a country, a region, a block, etc. When we
say developed economies, we mean economies of the developed countries.
Countries of the world might be facing some common economic challenges. At the same time, they
might be facing some highly specific challenges. Economists, during the period of evolution of
economics, have suggested some fixed number of theories and methods of solving those economic
challenges. Now it depends upon the choice of the countries as to which set of principles and theories
they select for solving their economic challenges. Now many countries selecting same remedy and
tools to fight the same problems might have similar or dissimilar results during a given period. At the
same time, two economies selecting different tools to solve the same economic problems might
experience the same results or completely different results. Why this is so?
Basically, economic theories are expectations of human behaviour about their economic activities and
as human behaviour depends greatly on many internal and external factors, the results are likely to
show diversities. The level and quality of natural resources, the quantity and quality of human
resources, the socio-political milieu, the historical background, the psychic make of the human
resource, etc. are some of the factors which individually as well as collectively impact an economy
while carrying out economic activities. These things make it highly difficult for economists to say and
forecast the kind of impact a particular economic policy will have on a particular economic setting.
Ultimately, implementation and delivery system, all play a highly vital role in solving economic
challenges in a country, which economists started studying after the 1960s. Therefore, it is correct to
say that economics has less diversity than the economies. There will not be any exaggeration if we
say that no two economies of the world are exactly the same, though we might classify them into
broader terms like developed and developing, agrarian and industrial, etc.
This diversity makes economics a highly interesting discipline. And via the diverse faces of the
economies the economists have been able to modify and remodify their ideas on the subject of
economics. The evolutionary history of economics is nothing but modifications in the past theories on
the basis of contemporary results and experiences of the economies. It is right to say that economics
has developed out of real life practices and it is from the practice to theory. As the practices will be
having newer dimensions, the theories of economics will also have newer and more imaginative
dimensions.
The relation between economics and the economy, simply saying, is that of theory and practice. While
the former is a discipline studying economic behaviour of human beings, the latter is a still-frame
picture of it. Economics will come out with theories of market, employment, etc. and an economy is
the real picture of the things which emerge after the follow-up to the same theories in certain areas.
Economy is economics at play in a certain region. This region is best defined today as a country, a
nation—the Indian Economy, the Russian Economy, the French Economy, etc. Economy as such means
nothing. It gets meaning once it is preceded by the name of a country, a region, a block, etc. When we
say developed economies, we mean economies of the developed countries.
Countries of the world might be facing some common economic challenges. At the same time, they
might be facing some highly specific challenges. Economists, during the period of evolution of
economics, have suggested some fixed number of theories and methods of solving those economic
challenges. Now it depends upon the choice of the countries as to which set of principles and theories
they select for solving their economic challenges. Now many countries selecting same remedy and
tools to fight the same problems might have similar or dissimilar results during a given period. At the
same time, two economies selecting different tools to solve the same economic problems might
experience the same results or completely different results. Why this is so?
Basically, economic theories are expectations of human behaviour about their economic activities and
as human behaviour depends greatly on many internal and external factors, the results are likely to
show diversities. The level and quality of natural resources, the quantity and quality of human
resources, the socio-political milieu, the historical background, the psychic make of the human
resource, etc. are some of the factors which individually as well as collectively impact an economy
while carrying out economic activities. These things make it highly difficult for economists to say and
forecast the kind of impact a particular economic policy will have on a particular economic setting.
Ultimately, implementation and delivery system, all play a highly vital role in solving economic
challenges in a country, which economists started studying after the 1960s. Therefore, it is correct to
say that economics has less diversity than the economies. There will not be any exaggeration if we
say that no two economies of the world are exactly the same, though we might classify them into
broader terms like developed and developing, agrarian and industrial, etc.
This diversity makes economics a highly interesting discipline. And via the diverse faces of the
economies the economists have been able to modify and remodify their ideas on the subject of
economics. The evolutionary history of economics is nothing but modifications in the past theories on
the basis of contemporary results and experiences of the economies. It is right to say that economics
has developed out of real life practices and it is from the practice to theory. As the practices will be
having newer dimensions, the theories of economics will also have newer and more imaginative
dimensions.
No comments:
Post a Comment