Why and who should study economics

Economics is a branch of social sciences which is concerned with people’s behaviour in the course of making a living. It is about the production, distribution and consumption of wealth.

Human needs and wants are numerous, but means of catering for those needs and wants are limited. Scarcity is at the centre of life. If anything were as abundant as air or sunshine, there would be no science of economics. Economics is also about how men and women make use of the scarce means to get what they want. In ordinary language, we should say how people use their time, energy and money to acquire the goods and services they want. All the three; time, energy and money are in limited quantity.

Because the means are scarce, people are competing with each other and sometimes this competition amounts to conflict. Economics helps those who know it to understand global issues such as wars between nations, civil wars, events such as inflation and their effects on lives of the people. Economics can lead both the individual and the nation to think correct.

No aspect of life is immune from the facts that concern economics. The problem of scarcity confronts all those engaged in political or religious life, those concerned with commercial or charitable work.

Everything worth having cost something. He was right who said there was no free lunch, the manner economist define costs differs from ordinary usage. If someone says he has bought a car for K10 million in ordinary language we say the cost of the car is ten million kwacha, but an economist asks what is the opportunity cost of the car? K10 kwacha is not the only cost of the car. The alternative thing he could have bought with ten million is also the cost. This type of cost is known as the opportunity cost, the opportunity that you have forgone by buying the car.

Economics thus teaches us always to remember that life is a matter of making choices, when you choose to have one thing at the same time you refrain from having the next best thing that would benefit you, when you pay university tuition fees for your children you forgo the opportunity to use that same money to buy something else or to leave if in the bank where it could earn you interest.

Who then should study economics? On 5th May 2017, according to Newsletter magazine dated July 2017 there was a one-day symposium hosted by HM Treasury (British Ministry of Finance) which brought two hundred economists from government, academia, business and the media to discuss the particular challenge of communication in technical subjects to the public.

Under the heading; Economics. The professional and the public we read inter alia, “Respondents expressed strongly the view that a great understanding of economics would be desirable not just for a better understanding of personal finance but also to enable more informed choices during elections.”

The last sentence is especially worth noting in Malawi where political parties are usually vague about how they are going to up lift the people’s standards of living, the electorate usually vote for a party that is based in their region because they think it is the one that will best provide for their economic needs.

The Newsletter article continues “coupled with this desire to learn more about economics was a sense of the subject’s relevance, with 83 percent of respondents reporting that economics is relevant to everyday life, further, while the survey found that the vast majority have not studied any economics there is an overwhelming consensus that it should feature in general school education. (21 percent responded that school age children should take a specific economic course, while 55 percent felt that economics should be embedded in the general curriculum).

On 16th September 2017 when at the Jacaranda Cultural Centre, I was invited to respond to the complimentary speeches I dwelt mostly on African contribution to ancient Egyptian civilisation and only made passing remarks to the economic situation in Malawi yet this is the topic that elicited most questions from the audience. The gist of the questions was how can we rid our country of its economic difficulties.

Evidently economics as a subject ought to be introduced in most secondary school, especially now that we have many graduates in this subject, whether one intends to be a doctor, pastor, lawyer or business person, one will find thinking and behaving like an economist relevant.

People engaged in public affairs such as politics will find knowledge of economics very useful because politics of today is mostly about matters.

It is not necessarily a pile of money that makes a group of people prosperous, it is the existence in abundance of goods and services on which money can be spent that matters most. Both workers and their employers should therefore be concerned with supply side economics before they tackled the demand side, raise the productivity which will lead to higher production and facilitate ample distribution of goods and services. n