Amer N. Raja
Money, because of its usability and value, is being considered as the most vital factor in Economics. To the majority and even the way the subject is being taught, it is considered that Economics is all about money. Why is money, a currency note - nothing more than a piece of paper talked of and loved so much? A better designed and mass produced paper of same size as Dollar will never get as much value as the Dollar itself. If that paper can solve problems - and to many monetary authority Officials, it seems it can - then why not print Dollars as much as possible, distribute it to everybody and see whether it works like the Midas' touch. Factually, it cannot. We all know that what actually happens when more paper - Dollar - is produced, its value falls like a house of cards and jeopardizes the whole monetary system. That much excess without any proper backing like gold or precious metals or production capability of an economy will eventually lose its trust, Value.
If it is not about paper/money, then what is Economics? Is it about expectations? When consumers have good expectations from the value derived from their purchases, they tend to buy more and if they expect better returns, they will invest more. Similarly, businessmen will take more risks if they see more profits for their capital invested. Likewise, professionals will work with confidence and can work more freely and diligently with the assurance of better remuneration.
Is Economics the art of negotiation, by understanding the human psyche, or an attempt to get the better deals? By better understanding the consumer behavior, businessmen can offer their products and services and at such a price where they can get best results. On the other hand, consumers will try to bargain to bring down the prices as much as possible. It is about smart negotiations. This is one of the areas of study in psychology. Can Economics then be considered as Psychology?
As is generally the case, Government owns the land in a present nation state structure; it also appoints Officials on key posts for disbursement of various funds, management and control of money and capital market - so is Economics about gaining power? The politics for winning mass support and reaching realms of power and later on, appointing cronies on key governmental posts and forming the cliché to better off a certain group and keep the masses happy - is this what Economics is all about?
Economics is about activity. Fundamentally, the aim of all human activities is to make one happier. From there, we can infer that it is a systematic study of moral philosophy as was with Adam Smith who left his own field to venture in Economics where he concluded that happiness is possible by increasing one's own welfare and that of the society in general.
Or, is it about observing the natural phenomenon and keeping records of the seasons to get better crops, and finding ways to being saved from tornadoes, floods and other natural calamities? Or, to gain some specific knowledge of geology or of similar kind in order to discover precious metals or other natural resource rich areas, and later, selling them to increase wealth.
Well, through specialized knowledge of marketing and advertising smart promotional schemes, businesses can increase sales enormously and consequently fetch higher prices. Does that imply that marketing and advertising are actually economics?
We also see complex equations and much scary looking sophisticated series of formulae and statistical methods with exquisite colorful graphs to befuddle the minds of people by calling themselves Economists. Is Economics then, the application of various mathematical and statistical methods like calculus, probability, time series analysis, etc.?
Thus, it would be better if we change our perspective while looking at these disciplines. No one can be a good specialist in some field unless one is a generalist.
Every effect has a cause and that cause will in turn becomes a cause for some other effect, ad infinitum. Causality is very fundamental in human activity so it means that if we have better knowledge of causes and effects that will make one wealthy. Then, can Logic be Economics as well?
Without any doubt innovations play a pivotal role in making big money. Is the study of gaining a particular knowledge and skills Economics?
The magic of sweet talking and sensational tirade is undeniable. Is mastering communication skills to get things done from others, Economics?
The list is exhaustive and can go on and on. Still then, what is Economics?
Broadly speaking, as there is something of vaguely defined Economics in every other field, so there is something of vaguely defined every other field, in Economics. Thus, it would be better if we change our perspective while looking at these disciplines. No one can be a good specialist in any field unless one is a generalist. In that light, Economist, Sociologist, Political Scientist, Logician, Anthropologist, etc. are all confusing callings. For clearer understanding, it would be more appropriate to integrate these fields of Social Sciences into one field, since no issue is independent of other factors pertaining to other fields of Social Sciences. This will result in a more realistic and comprehensive analysis/study giving due importance to the related factors.
When it comes to practice, we find that CEOs are hailing from different fields like engineering, finance, marketing, etc. and since managing of affairs in the most suitable manner depends on one's general overall understanding, it is thus required of that top Manager to be a good generalist which will help in removing the bias. This holistic approach in analyzing issues can result in better decision-making for sustainable and successful outcome while playing fairly in the business world.
