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[Note from the moderator: For an earlier discussion about the definition of 
economics, check out our archives at: 
http://cs.muohio.edu/Archives/hes/jun-95/ --E-MS] 
 
Patrick Gunning wrote: 
 
>The fundamental idea is that of how normal human beings 
>interact under the conditions of the market economy. 
 
Mary Schweitzer replied: 
 
>If we are talking history of economic thought, I presume we mean 
>the history of thought about economics, which brings us inevitably 
>to a definition of economics. 
 
>This was not the definition of economics, as a subject, that was 
>taught to me in school.  Rather, I learned that economics is 
>"the study of the production and distribution of goods and 
>services".  No "market" necessary there. 
 
>One might add "in the face of scarcity".  No market there, either. 
 
And: 
 
>I doubt Samuelson would define economics that way today. 
 
>On a more formal level, most economic analysis with which I am familiar 
>is of the nature of constrained maximization -- that is, 
>maximizing a set of goals subject to a set of constraints. 
 
>Nothing necessary there about markets either. 
 
 
WELL, at least, we are on the right track -- talking about the 
definition of economics. 
 
I am pleased to defend my definition: 
 
        Why do I define economics as the study of economic interaction under 
the conditions of the market economy (use of money, private property 
rights, specialization)? The answer is twofold. First, I believe that 
THE DRIVING FORCE BEHIND PEOPLES' INTEREST IN THE SUBJECT MATTER OF 
ECONOMICS IS THEIR INTEREST IN FINDING OUT THE KIND OF DECISIONS A 
GOVERNMENT MIGHT MAKE TO HELP CAUSE THE PRODUCTION OF WHAT ORDINARY 
PEOPLE REGARD AS WEALTH. Second, I do not believe that the simple 
proposition that THE PROSPECT OF MUTUAL GAINS FROM TRADE PROVIDE 
INCENTIVES FOR INDIVIDUALS TO PRODUCE WHAT ORDINARY PEOPLE REGARD AS 
WEALTH has been refuted. The study of economic interaction in the market 
economy helps us learn more about the second proposition. 
        Although what has come to be known as Adam Smith's proposition has not 
been refuted, it has been challenged in many ways. In order to judge the 
merit of the challenges, we must begin with a firm understanding of 
economic interaction under Smith's conditions. We gain this not so much 
by studying observable markets but by putting ourselves in the shoes of 
the actors who participate in the market economy. Not until we have this 
kind of intersubjective understanding -- i.e., the kind that good 
teachers of economics try to instill in their students -- can we 
competently judge the merit of arguments to the effect that the market 
economy needs to be aided, regulated, controlled, manipulated, or 
eliminated. Thus, the ultimate reason for studying the market economy is 
to evaluate arguments regarding government policies. This, in simplest 
terms, is the reason I define economics in this way. 
        Having defined economics in this way, I turn to the dead economists. I 
ask: In what way did they contribute (a) to our understanding of 
economic interaction under the market economy and (b) to our 
understanding of the effects of government policy in light of the 
propensity of individuals to produce wealth under the market economy 
conditions. 
 
I would invite Mary Schweitzer to defend one or more of her definitions 
or to attack mine on grounds other than: "That is not what I learned." 
And having done so, I invite her to go on to explain how her definition 
provides her with a guide to her work in the history of economic 
thought. 
 
-- 
 
Pat Gunning 
http://stsvr.showtower.com.tw/~gunning/welcome 
 
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