Category Archives: Economics 101

Economics – an introduction

To start with, lets discuss the importance of the subject. The most famous definition of Economics comes from Lionel Robbins who states that:

“Economics is a science which studies human behaviour as a relationship between ends and scarce means which have alternative uses

To elaborate further, let us assume that you are stuck on an island alone. There is certain amount of wood that is available on the island (this is the scarce means) and this wood can be used for alternate uses – would you use the wood to burn fire? Or to make shelter? Or to make a boat to reach the nearest habitation? Thus, the limited amount of wood has number of alternate uses. In this setup, Economics guides you in analyzing the choice made by the concerned decision maker.

Another example could relate to use of land in a village. Assume that you are SDM of Rampur subdivision in Barwani. In one of its tribal villages, there is 5 bighas land that is currently beingused for cow grazing. This limited piece of government land can also be used for building a school, a hospital or an anganwadi centre. Amongst these alternate uses, the gram panchayat, with the approval of SDM and Collector, may decide to either let the land be used for cow grazing and hence allowing villagers an alternate source of income or it may decide in favour of investing in social infrastructure. While it is a difficult decision to make, Economics can assist in making the choice an informed one.

Economics is broadly divided into two fields – Microeconomics and Macroeconomics. Microeconomics deals with behavior of small units – be it household behavior or how a particular firm functions. On the other hand, macroeconomics tends to aggregate such behavior over a large sample to analyse and assess the behavior at a macro level.

In this blog, we will discuss concepts of both microeconomics and macroeconomics with a special focus on public policy making and developmental paradigms.

Hello there!

It’s been a long time off this blog. But it’s never too late to pick up from where you left!

This time I am attempting to bring the subject of Economics closer to the blog readers. There is a growing interest in this subject across the country and I want to do my bit by handholding the readers into the intriguing world of Economics.

Let me state at the on start that the objective of this series is NOT to clear UPSC mains or BA papers or Masters Economics entrance examinations. My aim is to take Economics to a common blog reader with no initiation into the subject until now. While there are ample of books available in the market, there are limited ones that offer Indian context. Given the humble experience I have gained over the past few years in implementing government schemes, I will attempt to draw examples from day to day interaction in the field of policy making and implementation.

The blog will come in snippets – a topic would be taken up, its theory discussed and its relevance in the Indian context will be elaborated upon. I am looking forward to my interactions with the readers here and I would welcome your comments to improve upon the content or discuss anything you consider relevant. At the end, I will ask for your forgiveness if I am not able to pursue this blog on a regular basis as I might be constrained on time!

A brief update about myself – I was posted as Assistant Collector in Seoni for a year. Afterwards, I was posted with Department of Justice, Ministry of Law and Justice in Government of India. Subsequently I was SDM Nagda in Ujjain district for six months. I have now been posted as SDM Rajpur in Barwani district.