Prof. Lionel Robbins has given one of scientific definition of economics in his book ‘An essay on the Nature and Significance of Economic Science’ in 1932 AD.
This definition is also known as scarcity definition of economics.
Prof. Stonier and Hague also defined in the same line of Robbins.
According to Lionel Robbins, “Economics is the science, which studies human behavior as a relationship between ends and scarce means, which have alternative uses.”
The features of Robbins definition of economics are as follows:
Unlimited wants (ends)
Human being have unlimited types of wants (ends).
All wants cannot be satisfied at the same time.
All human wants can never be satisfied together.
If one want is fulfilled, another will emerge.
Limited means (resource)
In this definition ‘Means’ refers to available resources.
Resources could be anything such as raw materials, money and labor that help to satisfy human wants.
While the human wants are unlimited, the resources available to satisfy them are limited.
Alternative uses of scarce means
There are various uses of the resources.
If it is not used to satisfy any one of the want, that can be used to satisfy other wants.
All wants are not equally urgent.
Some wants are more urgent and cannot be postponed while other less wants can be postponed for the future.
Therefore limited resources can be use alternatively for maximum satisfaction.
Science of choice
Economic problem arise due to limited resource and unlimited wants but that can be solved due to alternative use of the resources to satisfy most urgent wants.
It gives the idea to make the proper choice at the right time therefore it is known as science of choice.
Robbins defined economics as the human science.
It is deals with the real human problems scarcity and choice.
Every rich as well as poor face the problem of scarcity and choice so it the human problem thus economics is the human science.
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Robbins’s scarcity definition is one of the scientific and modern definitions.
However, critics such as Lindley Fraser, R.W. Souter, T. Parson and Barbara Wootton criticized the definition on the various grounds which are explained below:
Ignorance to normative aspect
The scarcity definition ignored the normative aspect of human behavior.
While studying ‘what it is’, it will become incomplete if we ignore ‘what ought to be’.
Unclear on the scope of economics
D.H. Robertson says that the Robbins definition widened the scope of economics too much where the scope and limitation of economics cannot be separated from other subjects.
Hidden concept of welfare
Robbins in his definition has stated scarce resources are allocated optimally to produce goods that give maximum satisfaction.
The concept of welfare and maximization of satisfaction from the allocation of scarce resource on the most urgent wants is same; so that Robbins definition is old wine in new bottle only.
Limited scope of economics
Robins’ scarcity definition limits the scope. Robins confined the scope of economics within satisfying unlimited wants and allocating scarce resources.
But economics in reality is a growing science.
New branches and concepts are included in the subject matter of economics day by day.
However, this growth aspect of economics was completely ignored by Robbins.
Economic problems emerge due to over production
According to Lionel Robbins, scarcity is the main cause of economic problem.
The critics have denied this statement because economic problems like over production, sufficiency or abundance of the resources.
It pushes economy toward the depression.
Marshall’s and Robbins definition of economics have some similarities and dissimilarities which are as follows:
Similarities between Marshall’s and Robbins definition of economics
· Both definitions have given primary importance to the mankind than wealth.
· Both have defined economics as a science. Marshall has defined economics as the social science whereas Robbins defined as human science.
· The concept of welfare in Marshall’s definition and maximum satisfaction in Robbins definition is similar.
· Both of the definitions are based on the assumption of rational man.
Marshall’s definition of Economics
Robbins definition of Economics
Marshall’s definition is of classified definition of economics.
Robbins definition is of analytical definition of economics.
Marshall defined economics as social science.
Robbins defined economics as human science.
Marshall’s definition of economics studies about material welfare of mankind.
Robbins’s economics studies as a relationship between ends and scarce means.
Marshall has emphasized wealth as a means for the material welfare of mankind.
Robbins has emphasized scarcity of resources for the maximization of satisfaction.
Marshall defined economics as a normative science.
Robbins defined economics as a positive science.
Marshall’s definition is practical definition
Robbins’s definition is theoretical definition.
Marshall definition is known as welfare definition of economics
Robbins definition is known as scarcity definition of economics.
Robbins’ definition gives us a complete scope of economics.
Limited resources and unlimited human wants are very realistic, and are applicable at all time and situations.
In this manner, Robbins’ scarcity definition demolished the old structure of economics and made us look at economics in a new dimension.
First of all, Robbins’ explanation of economic problem is very clear and precise.
According to Robbins, the important factors that cause economic problems are unlimited wants, scarce resources and alternative uses of resources.
This definition has made human science to the economics.
All of the human beings either they live in the society or not face the problem of scarcity and choice in reality.
Robbins definition is universal in application.
All nations and economic systems face the problems of unlimited human wants and scarce resources.
That is why Robbins definition becomes more realistic.
Robbins’ definition is a positive study. It explains economics just based on ‘what it is’ and not based on ‘what ought to be’.
Robbins’s definition widened the scope of economics, as it included activities of producing immaterial goods in the subject matter of economics which can cover all of the scope of economics.
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