Economics is the social science that studies the production, distribution, and consumption of goods and services. The termeconomics comes from the Ancient Greekοἰκονομία (oikonomia, "management of a household, administration") from οἶκος (oikos,"house") + νόμος (nomos, "custom" or "law"), hence "rules of the house(hold)".[1] Current economic models developed out of the broader field of political economy in the late 19th century, owing to a desire to use an empirical approach more akin to the physical sciences.[2]
A definition that captures much of modern economics is that of Lionel Robbins in a 1932 essay: "the science which studies human behaviour as a relationship between ends and scarce means which have alternative uses."[3]Scarcity means that availableresources are insufficient to satisfy all wants and needs. Absent scarcity and alternative uses of available resources, there is noeconomic problem. The subject thus defined involves the study of choices as they are affected by incentives and resources.
