Economics is science in its methodology and an art in its application, because it has theoretical as well as practical aspects.
What is Science?
Science is a systematized body of knowledge ascertainable by observation and experiment. It is a body of generalizations, principles, theories or laws which traces out a casual relationship between causes and results.
Kinds of Science:
- There are two kinds of science:
- Positive Science
- Normative Science or Prescriptive Science
Positive science only explains "what is" and normative science tells us "what ought to be"-i.e., positive science describes while normative science evaluates. Thus, in positive science we derive propositions, theories and laws following certain rules of logic, which explain the cause and effect relationship between economic variables. While normative science is concerned with describing what should be the things.
Positive microeconomics is concerned with explaining the determination of relative prices and allocation of resources between different commodities. Whereas, positive macroeconomics is concerned with how the level of national income and employment, aggregate consumption and investment, and general price levels are determined. Normative economics is concerned with what price for a product should be fixed, what wage rate should be paid, how income should be distributed, etc.
What is Art?
Art is the practical application of scientific laws, principles and theories.
ECONOMICS AS A POSITIVE SCIENCE, NORMATIVE SCIENCE OR AN ART:
Economics is a positive science because:
- Firstly, economists collect the facts.
- Secondly, they analyze them and derive result.
- Thirdly, they determine the relationship between facts and results.
- Finally, they give a title to the bosomed relationship.
- Firstly, economists points out different economic problems.
- Secondly, they analyse them in the light of statistics or facts and figures.
- Finally, they advise policies, laws, theories to solve the problems.
- Economists suggest policies along with their implementation procedures to solve the economic problem.
Example: When an economy faces the problem of over population, the economists explain its causes like illiteracy, sociological and cultural set-up, early marriages, desire of having a good number of children, lack of access to birth control centers, reduced deaths rate, religious considerations, etc. This analysis is said to be positive economics or science.
When economists suggest to control birthrate by late marriages, education, changing social and cultural set-up, higher standard of living by less number of children, providing door to door birth control facilities, etc. this is said to be normative economics or science.
When government implement all this suggestions and people act upon and take care by different means and actions it becomes art.
Thus, economics is a science as well as an art.