Economic Theorists of history

Economics may appear to be the study of complicated tables and charts, statistics and numbers, but, more specifically, it is the study of what constitutes rational human behavior in the endeavor to fulfill needs and wants.

As an individual, for example, you face the problem of having only limited resources with which to fulfill your wants and needs, as a result, you must make certain choices with your money. You'll probably spend part of your money on rent, electricity and food. Then you might use the rest to go to the movies and/or buy a new pair of jeans. Economists are interested in the choices you make, and inquire into why, for instance, you might choose to spend your money on a new DVD player instead of replacing your old TV. They would want to know whether you would still buy a carton of cigarettes if prices increased by $2 per pack. The underlying essence of economics is trying to understand how both individuals and nations behave in response to certain material constraints.

We can say, therefore, that economics, often referred to as the "dismal science", is a study of certain aspects of society. Adam Smith (1723 - 1790), the "father of modern economics" and author of the famous book "An Inquiry into the Nature and Causes of the Wealth of Nations", spawned the discipline of economics by trying to understand why some nations prospered while others lagged behind in poverty. Others after him also explored how a nation's allocation of resources affects its wealth.

To study these things, economics makes the assumption that human beings will aim to fulfill their self-interests. It also assumes that individuals are rational in their efforts to fulfill their unlimited wants and needs. Economics, therefore, is a social science, which examines people behaving according to their self-interests. The definition set out at the turn of the twentieth century by Alfred Marshall, author of "The Principles Of Economics" (1890), reflects the complexity underlying economics: "Thus it is on one side the study of wealth; and on the other, and more important side, a part of the study of man."
1. Scarcity
Scarcity, a concept we already implicitly discussed in the introduction to this tutorial, refers to the tension between our limited resources and our unlimited wants and needs. For an individual, resources include time, money and skill. For a country, limited resources include natural resources, capital, labor force and technology.

Because all of our resources are limited in comparison to all of our wants and needs, individuals and nations have to make decisions regarding what goods and services they can buy and which ones they must forgo. For example, if you choose to buy one DVD as opposed to two video tapes, you must give up owning a second movie of inferior technology in exchange for the higher quality of the one DVD. Of course, each individual and nation will have different values, but by having different levels of (scarce) resources, people and nations each form some of these values as a result of the particular scarcities with which they are faced.

So, because of scarcity, people and economies must make decisions over how to allocate their resources. Economics, in turn, aims to study why we make these decisions and how we allocate our resources most efficiently.

2. Macro and Microeconomics
Macro and microeconomics are the two vantage points from which the economy is observed. Macroeconomics looks at the total output of a nation and the way the nation allocates its limited resources of land, labor and capital in an attempt to maximize production levels and promote trade and growth for future generations. After observing the society as a whole, Adam Smith noted that there was an "invisible hand" turning the wheels of the economy: a market force that keeps the economy functioning.
cont'd - http://www.investopedia.com/university/economics/

-video from ceteal1286 channel

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[hi79302]

sorry pal, Smith said everyone should pursue their self interest: effectively, acting selfishly. By the way, Hayek should have gotten a mention

[yourboycal]

@hi79302 number one rule in economics is self intrest lol . Of course everyone pursues there self intrest its sad but thats extactly what taints capitilism . But thats human nature it takes strong principals do to whats right and for the intrest of others . and woot for hayek and his philisophical views for free markets . but boo on the collectivism. There are many other economists and philisohpers that should've been in this video but winners write history =*(

[EarthBeautifull]

@yourboycal We are animals, animals only practice one law. That is the law of survival. That is the only law that matters in the universe. Altruism is not natural. One species never looks out for other species but their own. Capitalism is in line with natural order. Collectivism is suicide.

[bonfirejovi]

What the fuck? Marx was a miserable failure economically and was a crank and possibly a charlatan. He was a significant political figure and nothing more.

[zsylvana]

4) You can have planning based on routine, custom, tradition, magic, religion, ignorance – planning rules by rain-makers,shamans, fakirs and illiterates of all kinds. Worst of all, you can have planning directed by generals; for every army is based on an a priori allocation of resources. You can have planning organized in a semi-rational way by technocrats or, at the highest level of scientific intelligence, by workers and disinterested specialists.

[zsylvana]

5)Similarly, market economies in the sense of ex post allocations of resources have historically existed in the most variegated forms. In principle, there could be market economies with ‘perfect’ free competition: though in practice this has hardly ever been realized. There can be market economies skewed by the dominance of powerful monopolies able to control large sectors of activity and so to fix prices over long periods.