Nature of Economics
1.3-1 Economics .. As a Science and as an Art - A question often arises -
whether Economics is a science or an art or both. .
(a) Whether .Eco1101nics i5 a Science?
The tern, Science stands for a systematized body of knowledge, which traces
tl1e relationship between cause and effect. Further any scientific phenom-
enon also features the f ollo,ving :
( t) There should be objectivity. In other ,vords the phenomenon should be
capable of easy measurement.
, (iz) It sho uld hav e its own met hod olog ical
app arat us.
( iiz) It sho uld hav e abil ity to fore cast .
If we ana lyse Eco nom ics as a disc iplin e, we nd
fi ~hadt it dos ~ets es ~lldth e
feat ures of scie nce. Like scie nce, it is also a syst
It is cap able of bein g mea sure d in term s of mon
ema tize . 0 Y O ~;~ ~ ge.
h ~ ogy
ey. O
of stud y, i.e., indu ctio n and ded ucti on. Eco nom It ha s it: own mtt
ists a 1so ore cas . . e utu re
mar ket con diti ons with the help of vari ous stat
istic al and no~ -S t a~IStlcal tool s.
To und erst and clea rly, let us take the law of dem
and . It expl a~n s t e c~u se _and
effe ct rela tion ship betw een pric e and dem and
for a com mod ity. A~ pn~ e nses ,
the dem and for a com mod ity falls and vice vers
a. Her e the cau se ~s pnc e and
the effe ct is fall in qua ntit y dem and ed. Sim ilarl
y, the oth er eco nom ic la~ s seek
to esta blis h a logi cal cau se and effe ct rela tion
ship betw een eco nom ic phe -
nom ena .
But , ther e are crit ics who mai ntai n that Eco
nom ics sho uld not be give n the
stat us of scie nce . This is bec aus e ( z) eco nom ists
do not_ h-:1-ve a_ uni form opin i~n
and app roa ch abo ut a part icul ar econ om- ic
even t; 1t 1s said tha t wh~ n six
eco nom ists are gath ered ther e are seve n opin
sub ject -ma tter of Eco nom ics - the eco nom
ions (B~ rbar a Wo tte~ ) ( the
ic beh avio ur of man 1s high ly
z9
unp redi ctab le and can not be exp ect~ d to be
alw ays exa ct ( iii) mon ey whi ch
is use d as mea suri ng rod is itse lf a dep end ent
vari able ( iv) it is not pos sibl e to
mak e cor rect pred icti ons abo ut the beh avio
ur of eco nom ic vari able s.
How eve r, som e eco nom ists asse rt that the abo
ve gro und s do not rob Eco nom -
ics from its scie ntif ic stat us. The y argu e that
diff eren ce of opin ions is a
hall mar k in the gro win g scie nce s. Und oub tedl
y, ther e i~ a lack of prec isio n in
mea sur eme nt of eco nom ic phe nom ena . This
is bec aus e the sub ject -ma tter of
Eco nom ics is hum an eco nom ic beh avio ur, whi
ch is very com plex and unp re-
dict able . Pre dict ions in Eco nom ics may go wro
ng at tim es but in man y oth er
scie nce s also this cou ld hap pen ( e.g., met eoro
logy ). In this con text , Mar sha ll
has righ tly rem ark ed that law s of Eco nom ics
are like the law of tide s rath er
tha n the law of grav itati on.
(b) Wh eth er Eco nom ics is an Art ?-A cco rdin g
to Key nes : "An art is a syst em
of rule s for the atta inm ent of a give n end" . It
mea ns prac tic.e ofw ow led ge. It
is com plet ely diff eren t from scie nce . A scie
nce teac hes us to kno w and art
teac hes us to do. Wh ere as scie nce may stud
y the cau ses and· effe cts of a
phe nom eno n, art sho ws solu tion s to the
vari ous pro blem s. A scie nce is
theo reti cal, an art is prac tica l.
If we ana lyse Eco nom ics, we find that it has the
feat ure s of a~-~ rt also . Its
var iou s bra nch es, con sum ptio n, pro duc tion and pub lic fina nce etc.
pra ctic al solu tion s to vari ous eco nom ic pro pro vide
blem s. Its kno wle dge h~lp s us in
solv ing pra ctic al eco nom ic pro blem s of day
-to- day life.
;h1:5.E~onom~cs i~ both a s~ience ~nd an art. It is "science" in methodology and
art In Its app hcat io-? . As s_c1ence, It f<;> r~ul ates
vari ous pro blem s. Stu dy of the
ca~ se and effe ct of 1nfl ~tio n fal!s _w1th1n the
pur view of scie nce but form ing
suit able mon etar y and f1s: al poh c1es to che ck
infl atio n is an art. In this reg ard ,
Sam uel son has ~1ghtly said that Eco nom ics
new est of the scie nce s. is the olde st of the arts and the
1.3-1 Economics .. As a Science and as an Art - A question often arises -
whether Economics is a science or an art or both. .
(a) Whether .Eco1101nics i5 a Science?
The tern, Science stands for a systematized body of knowledge, which traces
tl1e relationship between cause and effect. Further any scientific phenom-
enon also features the f ollo,ving :
( t) There should be objectivity. In other ,vords the phenomenon should be
capable of easy measurement.
, (iz) It sho uld hav e its own met hod olog ical
app arat us.
( iiz) It sho uld hav e abil ity to fore cast .
If we ana lyse Eco nom ics as a disc iplin e, we nd
fi ~hadt it dos ~ets es ~lldth e
feat ures of scie nce. Like scie nce, it is also a syst
It is cap able of bein g mea sure d in term s of mon
ema tize . 0 Y O ~;~ ~ ge.
h ~ ogy
ey. O
of stud y, i.e., indu ctio n and ded ucti on. Eco nom It ha s it: own mtt
ists a 1so ore cas . . e utu re
mar ket con diti ons with the help of vari ous stat
istic al and no~ -S t a~IStlcal tool s.
To und erst and clea rly, let us take the law of dem
and . It expl a~n s t e c~u se _and
effe ct rela tion ship betw een pric e and dem and
for a com mod ity. A~ pn~ e nses ,
the dem and for a com mod ity falls and vice vers
a. Her e the cau se ~s pnc e and
the effe ct is fall in qua ntit y dem and ed. Sim ilarl
y, the oth er eco nom ic la~ s seek
to esta blis h a logi cal cau se and effe ct rela tion
ship betw een eco nom ic phe -
nom ena .
But , ther e are crit ics who mai ntai n that Eco
nom ics sho uld not be give n the
stat us of scie nce . This is bec aus e ( z) eco nom ists
do not_ h-:1-ve a_ uni form opin i~n
and app roa ch abo ut a part icul ar econ om- ic
even t; 1t 1s said tha t wh~ n six
eco nom ists are gath ered ther e are seve n opin
sub ject -ma tter of Eco nom ics - the eco nom
ions (B~ rbar a Wo tte~ ) ( the
ic beh avio ur of man 1s high ly
z9
unp redi ctab le and can not be exp ect~ d to be
alw ays exa ct ( iii) mon ey whi ch
is use d as mea suri ng rod is itse lf a dep end ent
vari able ( iv) it is not pos sibl e to
mak e cor rect pred icti ons abo ut the beh avio
ur of eco nom ic vari able s.
How eve r, som e eco nom ists asse rt that the abo
ve gro und s do not rob Eco nom -
ics from its scie ntif ic stat us. The y argu e that
diff eren ce of opin ions is a
hall mar k in the gro win g scie nce s. Und oub tedl
y, ther e i~ a lack of prec isio n in
mea sur eme nt of eco nom ic phe nom ena . This
is bec aus e the sub ject -ma tter of
Eco nom ics is hum an eco nom ic beh avio ur, whi
ch is very com plex and unp re-
dict able . Pre dict ions in Eco nom ics may go wro
ng at tim es but in man y oth er
scie nce s also this cou ld hap pen ( e.g., met eoro
logy ). In this con text , Mar sha ll
has righ tly rem ark ed that law s of Eco nom ics
are like the law of tide s rath er
tha n the law of grav itati on.
(b) Wh eth er Eco nom ics is an Art ?-A cco rdin g
to Key nes : "An art is a syst em
of rule s for the atta inm ent of a give n end" . It
mea ns prac tic.e ofw ow led ge. It
is com plet ely diff eren t from scie nce . A scie
nce teac hes us to kno w and art
teac hes us to do. Wh ere as scie nce may stud
y the cau ses and· effe cts of a
phe nom eno n, art sho ws solu tion s to the
vari ous pro blem s. A scie nce is
theo reti cal, an art is prac tica l.
If we ana lyse Eco nom ics, we find that it has the
feat ure s of a~-~ rt also . Its
var iou s bra nch es, con sum ptio n, pro duc tion and pub lic fina nce etc.
pra ctic al solu tion s to vari ous eco nom ic pro pro vide
blem s. Its kno wle dge h~lp s us in
solv ing pra ctic al eco nom ic pro blem s of day
-to- day life.
;h1:5.E~onom~cs i~ both a s~ience ~nd an art. It is "science" in methodology and
art In Its app hcat io-? . As s_c1ence, It f<;> r~ul ates
vari ous pro blem s. Stu dy of the
ca~ se and effe ct of 1nfl ~tio n fal!s _w1th1n the
pur view of scie nce but form ing
suit able mon etar y and f1s: al poh c1es to che ck
infl atio n is an art. In this reg ard ,
Sam uel son has ~1ghtly said that Eco nom ics
new est of the scie nce s. is the olde st of the arts and the
