Essay Example on Economics: Driving Society's Growth & Welfare

The growth and welfare of society are crucial aspects that drive economists. The approach is achieved by understanding how individuals make decisions in the face of scarcity. Economics assist society to understand and decide on how to allocate scarce resources with the aim of improving their life (Mumtaz & Theodoridis, 2017). Additionally, economics assists humans to comprehend what is happening in the markets, thus understanding the best period for selling products(Tirole, 2017). The approach is achieved by defining the statistical aspects of a country, which helps in differentiating various policies, thus assessing the likely results (Polasky et al., 2019). For positive outcomes to be achieved, there is a need to understand how to distribute scarce resources (Meyer & de Jongh, 2018). The conceptual approach of scarcity assists economists to think of what, how, and for whom to produce, and this forms the base for economic growth (Tirole, 2017). As such, economics is a useful, practical tool that aims at improving the way of life. The essays reviews how economics is useful in practices on the bases of scarcity, country management, overcoming market failure, and much more.

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Throughout the world, wants and needs are more as compared to the available scarce resources (Polasky et al., 2019). It is the role of economics to deal with a shortage of raw materials by understanding how to distribute the available resources (Polasky et al., 2019). In distribution, economists allocate resources based its demand on society. Some resources, such as hospitals, are crucial for human survival (Mumtaz & Theodoridis, 2017). Therefore, economics form a base that influences how resources in society are distributed (Tirole, 2017). The approach helps to avoid social inequality, thus eliminate some critical social problems (Meyer & de Jongh, 2018). As such, it is easier to understand when the government intervenes, thus improving economic status.

Economics assists in understanding how a country manages its budget and other essential resources. As such, economics helps in explaining how micro aspects such as inflation and mass unemployment impact the growth of a country (Mumtaz & Theodoridis, 2017). For instance, In 1930, the United Kingdom faced a great depression that negatively affected the economy (Polasky et al., 2019). However, through the assistance of economists, the UK government introduce policies that assisted in balancing the resources by controlling aspects such as taxes and increasing employment (Polasky et al., 2019). In this case, the stability of the country was in the hand of economists. The establishment of economic policies gives the country the best solution, thus improving microstates (Tirole, 2017). As such, policies assist a country to effectively overcome the economic crisis, thus improving the living condition of people (Meyer & de Jongh, 2018). Additionally, economic policies assist a country to effectively deal with the persisting recession (Rojas, 2019). This creates a strong economic background that pushes for growth.

Economics assists individuals in overcoming market failure as it offers guidelines for the best period for selling products (Rojas, 2019). As such, economics assists individuals in developing a plan based on market performance (Polasky et al., 2019). Therefore, it is easier for a company to understand on production rate, thus reducing the chances of market failure (Mumtaz & Theodoridis, 2017). Additionally, the approach may help to avoid negative externalities such as pollution that may occur in case a company engages in overproduction (Polasky et al., 2019). Through this aspect, it is easier for companies to sell products when the price is high, thus enjoying the economic benefits (Tirole, 2017). High profit assist companies in introducing more advanced systems such as technology, which improves market performance (Meyer & de Jongh, 2018). Technology development assists companies in overcoming negative economic externalities, thus improving the understanding of the market.

Economics assists in forecasting the growth and development of a country. Through the understanding of the current economic situation, it is easier to understand the growing trend within a particular period (Polasky et al., 2019). Prediction shapes individuals' and companies' decision-making approach, which determines future performance (Meyer & de Jongh, 2018). In the case of a bad decision, it is the role of economists to determine fate, thus controlling a country from engaging in some critical conditions that may influence people’s life (Tirole, 2017). For instance, a country may decide to join a particular group, but due to monetary policy, it may become challenging for its success (Mumtaz & Theodoridis, 2017). In this case, economists may discourage a country from such decisions, thus controlling some critical future challenges. In case of an election, politicians tend to promise voters that they are going to lower the tax and increase spending. However, economists will practically understand that every aspect occurs with opportunity cost (Mumtaz & Theodoridis, 2017). Therefore, increasing the spending means that the tax will automatically be higher for citizens to attain particular social needs (Polasky et al., 2019). As such, economics acts as the principle of opportunity cost, thus assist nations in understanding the best way to solve the existing issues. As such, it is easier for economists to investigate and understand the impact of particular rules (Tirole, 2017). Understanding and knowledge impact economists to advise political leaders on the way forward toward a decision (Meyer & de Jongh, 2018). Through the approach, it easier for the government to understand various opportunities and challenges underlying a particular decision (Polasky et al., 2019). Practically, spending is crucial aspects that impact the future of a business (Mumtaz & Theodoridis, 2017). Economists assist individuals, businesses, and governments in understanding their spending habits, and thus, it easier to balance income and expenditure (Tirole, 2017). The willingness to pay particular aspects is perceived as the base of economic behavior. As such, it easier to impact people and businesses to behave rationally, thus controlling their spending rate (Meyer & de Jongh, 2018). Additionally, spending and income rates determine if a business can borrow a loan. In case a business spends more as compared to income, it is not economically advisable to take a loan.

The success of a business is highly bounded to understanding the economic state. In this case, economics impacts the kind of strategies a business deploys (Rojas, 2019). Based on the economic trend, it is easier for a business to introduce more strategies, thus pushing its growth (Meyer & de Jongh, 2018). Conducting aspects such as SWOT analysis assist a business to understand about the market performance (Tirole, 2017). The approach assists in assessing situations, thus making numerous economic decisions that impact the performance (Polasky et al., 2019). Effective economic analysis assists businesses to engage in the best approach, thus maximizing revenues.

Working with numerous variables makes it easier for economists to evaluate the future of businesses. Through examining the kind of activities a business engages, it easier for economists to evaluate its fate (Mumtaz & Theodoridis, 2017). As such, evaluation assists governments in avoiding aspects such as the free market as they come with a lot of disadvantages to the nations (Polasky et al., 2019). Additionally, evaluation assists a country in introducing more effective approaches, thus improving the welfare of people (Rojas, 2019). Economists are mandated to evaluate the utility to determine the number of goods required in comparison to the price (Tirole, 2017). For a person to maintain their welfare, they are required to consume a number of goods that fit within the budget (Mumtaz & Theodoridis, 2017). Through the aspect, it easier for economists to evaluate the marginal benefits, which assist in determining the spending rate.

Additionally, economics has a close connection with the division of labor as it guides businesses on the allocation of tasks according to individuals’ abilities (Rojas, 2019). Specialization in certain task assists employees to effectively concentrate on a particular field, thus enjoying the economic benefits (Meyer & de Jongh, 2018). As such, division of labor assist in an increase in production, thus boosting the growth of businesses (Tirole, 2017). For instance, allocating duties based on individuals’ skills assist a business to produce more advances system, thus enjoying market advantages. The approach forms the base for the growth of a business and a country.

The economic state has a great impact on everyday issues (Polasky et al., 2019). In this case, a region that is economically disadvantaged is mostly associated with aspects such as crime, poor education, and much more (Mumtaz & Theodoridis, 2017). As such, the kind of life people live is highly determined by regions of economic status. People engage in activities such as crime to satisfy their economic needs (Tirole, 2017). Furthermore, people engage in such activities with the aim of controlling social inequality. Behavioral economics impact people to act in a particular manner (Meyer & de Jongh, 2018). For instance, behavioral economics impact people to engage in a stock market, instead of buying assets such as a car, which is hard to convert into cash.

Economic understanding impacts businesses to diverse in various activities, thus promoting their growth. In this case, economic impact diversity, thus promoting different types of industries within an area (Mumtaz & Theodoridis, 2017). The approach triggers the creation of other monetary aspects, such as employment (Tirole, 2017). When a country embraces economic diversity, there is massive growth, which triggers an improvement of life. Additionally, the approach triggers to business expansion and growth as more innovations are introduced in all aspects of the economy (Polasky et al., 2019). As such, it becomes easier to stabilize the economic status of a country. Through the approach, the government is able to create better infrastructure, which improves the quality of life (Tirole, 2017). Furthermore, people are able to live in a society that is driven by the need for a better life. Diversity gives people an opportunity to select various materials, thus acquiring the best conditions of life. As such, economics plays a vital role in the improvement of living standards.

Conclusion

In conclusion, economics is a useful tool that is highly deployed in numerous practices across the world. The application of economics assists individuals, businesses, and governments in understanding how to effectively use scare resources. As such, it becomes easier for a business to effectively manage resources, which is a critical aspect of development. Economists are mandated to put their knowledge into practice by creating the best platform that businesses and countries are supposed to promote development. The knowledge of economics assists businesses in engaging in different approaches, thus promote the growth and improvement of quality of life.

References

Meyer, N., & de Jongh, J. (2018). The importance of entrepreneurship as a contributing factor to economic growth and development: The case of selected European countries. Journal of Economics and Behavioral Studies, 10(4), 287-299. https://ojs.amhinternational.com/index.php/jebs/article/view/2428

Mumtaz, H., & Theodoridis, K. (2017). Common and country specific economic uncertainty.