Scarcity and the Science of Economics 短缺经济学

The Fundamental Economic Problem

基本的经济问题

The fundamental economic problem facing all societies is that of scarcity. Scarcity is the condition that results from society not having enough resources to produce all the things people would like to have.

Economic is the study of how people try to satisfy what appears to be seemingly unlimited and competing wants through the careful use of relatively scarce resources.

Needs and Wants

需要和欲望

A need is a basic requirement for survival and includes food, clothing, and shelter.

A want is a way of expressing a need.

“There Is No Such Thing as a Free Lunch” TINSTAAFL

Three Basic Questions

三个基本问题

— WHAT to Produce

— HOW to Produce

Mass production methods in countries where machinery and equipment are widely available can often lower production costs.

— FOR WHOM to Produce

They must be answered as long as there are not enough resources to satisfy people’s seemingly unlimited wants.

The Factors of Production

生产要素

The factors of production, resources required to produce the things we would like to have, are land, capital, labor, and entrepreneurs,

— Land, includes the “gifts of nature,” or natural resources not created by human effort.

— Capital, Capital goods, includes the tools, equipment, and factories used in production, from financial capital, the money used to buy the tools and equipment used in production.

— Labor, includes people with all their efforts, abilities, and skills. Includes all people except entrepreneurs.

— Entrepreneurs are the innovators responsible for much of the change in economy. They provide the initiative that combines the resources of land, labor, and capital into new products.

[They are needed to organize the other three factors and make sure that everything gets done]

The Scope of Economics Description ,Analysis, Explanation, Prediction

GDP [Gross Domestic Product], dollar value of all final goods and services, and structures produced within a country’s borders in a 12-month period. The most comprehensive measure of a country’s total output and is a key measure of the nation’s economic health.