What is Economics

Economics is a social science that studies how societies allocate scarce resources to meet unlimited wants and needs. It examines the production, distribution, and consumption of goods and services, as well as the behavior and interactions of individuals, firms, and governments in the process. Economics analyzes how individuals and societies make choices and decisions, considering factors such as supply and demand, costs and benefits, incentives, and market dynamics. It encompasses various subfields, including macroeconomics, microeconomics, econometrics, and applied economics, which focus on different aspects of economic phenomena and behavior.

Types of Economics

The field of economics is wide and diverse, comprising numerous sub-disciplines that focus on various aspects of economic behavior and implications. While the types of economics are numerous, we will focus on a few key types here: Macro Economics, Micro Economics, Econometrics, and Applied Economics.

Macro Economics

Macro Economics is a branch of economics dealing with the performance, structure, behavior, and decision-making of the entire economy. This includes regional, national, and global economies. Macro economics studies aggregated indicators such as Gross Domestic Product (GDP), unemployment rates, and price indices to understand how the whole economy functions.

Micro Economics

Micro Economics is a field of economics that focuses on the behavior and decision-making of individual economic agents, such as individuals, households, and firms. It examines price determination in individual markets, the relationship between demand and supply, choices made by producers and consumers, and resource allocation.

Econometrics

Econometrics is the application of mathematical and statistical methods to economic data for the purpose of testing theories and models, or deriving estimates and inferences about economic phenomena. It serves as a bridge between theoretical and practical economics, providing tools for decision-making and policy formulation.

Applied Economics

Applied Economics refers to the application of economic theory and econometrics in specific settings.

Behavioral Economics

Behavioral Economics combines insights from psychology, judgment, decision making, and economics to generate a more accurate understanding of human behavior. It deviates from traditional economics, which assumes that individuals are perfectly rational and always aim to maximize their utility.

Urban Economics

Urban Economics is a branch of economics that deals with the economic analysis of cities. It involves the study of spatial arrangement of households, businesses and capital in urban areas. It also explores issues such as urban housing, transportation, city governance, and crime.

Transportation Economics

Transportation Economics is a branch of applied economics that uses economic theories and statistical techniques to analyze, design, and improve transportation systems. It is a crucial tool in resolving transportation problems and improving efficiency.

Development Economics

Development Economics is a branch of economics which deals with economic aspects of the development process in low-income countries. Its focus is not only on methods of promoting economic growth and structural change but also improving the potential for the mass of the population, for example, through health, education and workplace conditions.

Environmental Economics

Environmental Economics studies the economic effects of national or local environmental policies around the world. Economics studies a wide range of topics such as pollution control, resource conservation, and the effects of climate change.

Health Economics

Health Economics is the branch of economics concerned with issues related to efficiency, effectiveness, value and behavior in the production and consumption of health and healthcare. This includes the study of healthcare systems, healthcare financing, and individual behaviors that influence health.

Agricultural Economics

Agricultural Economics focuses on the application of economic theory to optimizing the production and distribution of food.

Financial Economics

Financial economics evaluates the spatial and temporal movement of economic resources in an uncertain environment. It assesses how individuals, businesses, and organizations raise funds, invest capital, and make decisions regarding financial risks.

Industrial Economics

Industrial Economics is the study of firms, industries, and markets. It looks at firms of all sizes – from local corner shops to multinational giants. And it considers a whole range of industries, such as manufacturing, services, primary industries, and the creative economy.

Labor Economics

Labor Economics seeks to understand the functioning and dynamics of the market for labor. That is, the determination of wages, the wage differential among various types of labor, levels of employment and unemployment, and the role played by labor unions in the labor market are among the subjects studied.

Public Economics

Public Economics is the study of government policy through the lens of economic efficiency and equity. Public economics builds on the theory of welfare economics and is ultimately used as a tool to improve social welfare. Public economics provides a framework for thinking about whether or not the government should participate in economic markets and to what extent its role should be.

International Economics

International Economics studies the economic interactions among countries. It includes the study of international trade, international finance, and the study of international economic policies. It also studies economic growth of countries and how they are interconnected.