Question

In: Economics

Relationship of economics with other subjects.

How economics is related with other subjects? Illustrate. What is the relationship of economics with other subjects? 

Solutions

Expert Solution

Relationship Of Economics With Other Subjects -------------

 

Economics is a very wide subject and it is recognised as a well established social science. Accordingly, it has a close relationship with many other subjects of science and arts stream.

 

1.   Economics and Political Science -----------

Economics was earlier known as 'political economy' and hence its roots in political science are obvious. Although, now, both these disciplines have developed independently but still branches of economics like public finance, economic planning, monetary and fiscal policies, are greatly influenced by political thoughts. Every political party has its own economic policies and they try to justify it by their political logic. Similarly, the basis of political relationship between any two countries is economic benefits. Hence the two subjects are closely related.

 

2.   Economics and Sociology --------------

Economics and Sociology both are social sciences and there is similarity in the method of study of both disciplines. The reason for similarity in both disciplines is that social changes affect economic change changes and vice-versa. Economics in modern time is becoming more and more oriented towards the human issues like health, education, gender equality etc. and human development is now being considered a better Indicator of development than the national income alone. In fact, both subjects have become complementary to each other.

 

3.   Economics and Psychology -----------

Both economics and psychology study human behaviour. While psychology studies the causes and forces behind human behaviour, economics studies the consequences of such behaviour with relation to ends and means. The closeness of both these disciplines has resulted in what is now called " Experimental Economics ". Nobel Prize winner in Economics for 2002 Daniel Kahnman is basically a psychologist.

 

4.    Economics and Statistics -----------

Economics and Statistics also have a close relationship. Statistics is used in economics basically as a tool of analysis. In inductive method of economic analysis we make an extensive use of statistics. As the availability of data in various fields of of an economy like consumption, production, public finance, international trade, demography etc. is increasing, there is greater scope and need to use statistical tools. The use of statistics is almost inevitable, if we want to derive some essence out of sea of the statistical data. In fact, econometrics is the discipline where we make a statistical analysis of economic principles and theories.

 

5.    Economics and Mathematics ---------

The use of mathematics in economics is rapidly increasing. Firstly, the increasing use of statistics makes the use of mathematics imperative and secondly, mathematical expression of economic principles greatly facilitates further analysis. Finding the maximum satisfaction level of the consumer, the optimum production level for a producer or a profit maximization level of a seller is very easy with the help of the mathematics. The increasing use of mathematical models in economics is also a pointer towards the increasing use of mathematics in economics.

 

6.   Economics and Management Science -----------

Management owes its origin to economics and, therefore, the fundamental concepts of management are derived from economics. In various aspects of management, like finance, marketing, production management, the basic logic of analysis is provided by economics. It is due to this reason that the study of economics has become mandatory for all the students of management.

In this way, we find that economics has a close relationship with the above disciplines. Apart from these, it also has some relationship with the history, geography, philosophy, and logic. It is due to this reason that there is increasing awareness for studying economics and an introduction to economics is considered essential for every educated person. 


Economics is a very wide subject and it is recognised as a well established social science. 

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