Economics as Science of Scarcity
Lord Robbins in his book,” an essay on Nature and Significance of Economic Science” in 1931 defined Economics as Science of Scarcity.
According to him, Scarcity is the root cause of all economic problems. Scarcity is the subject matter of economics. As per him, economics is the science which studies human behaviour as a relationship between ends and scarce means which have alternative uses.
Features of Economics as a Science of Scarcity
- Economics is a Science: Economics is a positive or real science. It studies how consumer with given income and price of commodity, try to maximize their satisfaction.
- Unlimited wants and scarce resources/ means: Man has been provided with unlimited wants but the means to satisfy these wants are scarce. These give rise to economic problem; what to produce, how to produce, when to produce, for whom to produce. If the resources would have been abundant or wants were limited, there would have been no economic problem. Here scarcity is not used in absolute sense rather used in relative sense in relation to demand. If a commodity is available in small quantity but not demanded by anyone then it is not scarce.
- Alternative uses: The economic problem becomes further complex when we know that resources are capable of alternative uses. Like milk. It depends upon the society whether they want curd or cheese. So they have to select out of alternative uses of milk.
As per Robbins,” Economics is neutral between ends.”
Criticism of Economics as a Science of Scarcity
- Positive Science: According to Robbins Economics is a positive science but it is a normative science also as it tells what ought to be, or not ought to be the level of national income, per capita income, wage rate etc.
- Impractical: We all know that our wants are unlimited and means are limited but we seek to know how to make proper use of means to get maximum satisfaction. But as per Robbins economics cannot offer suggestions.
- Scarcity is not only economic problem: There are many other economic problems like problem of unemployment, problem of depression.
- Economics only concentrate on micro economics but ignored Macroeconomics laws and regulations.
- It is not applicable to rich countries.
I hope you have understood the concept and meaning of economics as science of scarcity, its features and criticism.