Why study Economics

Economics is a social science as we know, however recently it has shown trades of a full fledged mathematical Science. Economics does not has a formally acccepted definition, probably this separates it from other sciences. The recent use of analytical and statistical methods in economics have improved the policy making and its analysis, this inadvertently has helped economics to grow as a science.

Traditionally economics is divided in two major sections, one is microeconomics and second is macroeconomics. Microeconomics looks economics from the individualistic perspective like a firm, product, market, etc. It gives models which helps economists to understand how market works and how it can made more efficient so that leakages can be reduced. Its one more purpose is to understand how individuals behaves if they are offered similar products and how their choices very. Macroeconomics looks at overall economics of a nation or a community, it understands how decisions made by group of individuals affects overall economics. It looks at indicators and how these indicators are impacted by various policies made by states and by various interstate interactions.

Economics is debatably the only social science that touches every aspect of day to day life of both ordinary and rich folks. This is the prime reason why this word appears a lot in news around us. This is also the reason that it is a major maker and breaker in political ranks, and at past have fuelled revolutions against the establishment.

The present use of econometrics in economics has seen a rising trend, althogh traditional economists are against the excess use of econometrics but rise in cheap computation power and availability of advanced software which allows economists to do sophisticated analysis, without going into too much depth in both statistics and programming. This is allowing researchers to do focused research while at the same time use of advanced graphical softwares allow for better representation of findings. This has caught the attention of larger population which in turn sees more economics focused debates as more public gain understanding of ecmomics more important it becomes.

One more essential requirement of every research is sample, sample is defined as a smaller representative of the underlying population. The sample requires the use of statistical methods to better understand the unknown population. The sample collection is traditionally very costly and requires a large share of resources which thus limits the quality of research. Sample collection is still a daunting and costly task, however start of open services and demand of greater transparency in administration has made data access cheaper, the availability of data on websites of various agencies have further reduced the efforts required to collect the data to do research. The better sample collection and data availability has improved the quality of research.

Econometrics has improved the economics methods and understanding of policies, which no doubt will give good feedback to policymakers and will give quick chance to improve the policies and make them more targeted towards the needy increasing its reach. Recently policymakers are under pressure from administration to reduce the leakages and decrease the bill while at the same time increasing the reach of the program.

In above paragraphs, I have kept my focus on analytics and policymaking because analytics is an inherent part of economics it has always helped economists to further their research. While policymaking is an important reason for the research, hence the focus on analytics and policymaking. Lets turn our focus back to economics, economics requires right bend of art and science and like other social sciences fix laws cannot define it. We need to understand economics with these constraints in mind.