The old name of economics is "political economy" is derived from three Greek words:
- Plis – An organized society or state.
- Oikas – house or home.
- Nomas – means law.
To translate and rearrange the meaning of these three worlds we say that economics is the study of the law of household management as applied ot the state.
Because of the classical definition and criticism a lot of misconceptions were created. Which badly effect the development of economics? Nobody had the courage to define economics because of the fear of that kind of criticism to which Adam smith was faced.
A British economist Alfred Marshall wrote a book in 1798 "Principles of economics" at this stage. He tried to remove the misconception and put economics on the road of development.
A consumer is said to be in equilibrium when he attains maximum satisfaction from his given money income on the commodities which he purchases from the market, where the consumer has no tendency to re-arrange his purchases....
Firms Equilibrium or Optimum Factor Combination Can Be Explained In Two Cases:
Robbin's is the representative economist of the modern school of thought. He pointed out the defects in Marshall's definition and in his book "NATURE AND SIGNIFICANCE OF ECONOMICS SCIENCE" in 1931; he presented his own definition of economics. Which is as follows
"Economics is a science which studies human behavior as a relationship between ends and scares means which have alternative uses".
Robbin's says my definition is superior to others because
The old wine in a new bottle:
According to D.H Robertson the ordinal approach is just like an old wine in a new bottle. As 1C approach the same old concepts have been presented with new names. As against utility, the concept of 1C; rather 1,2,3,4..