Friday, November 5, 2010

       "Economics is the Science of Scarcity and Choice"

Prof. Lionel Robbins has strongly criticized Alfred Marshall's definition about economics in 1931-1932 in his book "Nature and Significance of Economic Science." He said that the concept of material welfare does not explain the subject economics on wide and scientific grounds. The word "material" imposed unnecessary limitation.

Prof. Lionel Robbins thus defined economics in the following four fundamental propositions that constitute the basis of the structure of economic science.

1.     Human wants or ends are unlimited.
2.     Human wants are different in importance.
3.     Resources to fulfil human wants are limited.
4.     Resources have alternative uses.

1.  Wants or Ends are Unlimited:
Human beings have wants which are unlimited in number. If one want is satisfied another crops up. If wants had been limited, they would have not and all incentives to economic effort would have ceased.

2.  Wants or Ends vary in Importance:
Human wants are not of equal importance because these are uncountable. Therefore, they compel us to choose between more urgent and less urgent ones.

3.  Resources are Scarce:
To satisfy unlimited wants people have limited economic resource. These resources are various types of labour Capital, land and entrepreneurship used in producing goods services. Since these resources are limited, the ability of the community to produce goods and services is also limited.

4.  Resources have Alternative Uses:
The limited resources are capable of alternative uses. As wants are varying in importance, some are more urgent and others less urgent. There, resources should be used selectively to the most urgent wants firstly, so choice comes again.

Keeping all the above points in view, Robbins' idea can simply be stated in the following words of Prof. Wicksteed.
"Economics is a science which is the study of those principles on which the resources of a community should be so regulated and administrated as to secure the communal ends without waste."

According to Prof. Lionel Robbins 
"Our economics holds good under barter as well as under money exchange, under individual as well as under social human conduct, under capitalist as well as under socialist society."
The followers of Lionel Robins' like Wicksteed, Schonfeld, Hans Mayhers, Carl Manger, Strigler, Fetter, Schaffle, Spaan, Cohen, Oppenheimer, Maxweber, Voigt etc. also called economics as "a science of scarcity and choice."

All of them are of the view that resources as compared to desires are limited and economic problem is that how these limited resources can be used to satisfy maximum desires.

According to Prof. Stigler 
"Economics is the study of the principles governing the allocation of scarce means among competing ends when the objective of allocation is to maximize the attainment of the ends."


Robbins has provided a strong basis of the relationship between unlimited desires and limited means to the structure of economics science, which has changed the scope of economics. His definition about economics is superior to all the earlier definitions, which can easily be understand from the following points:

1.  Scientific View:
Prof Lionel Robbins' definition about economics is more scientific because it is not based on the Marshall's artificial classification of material and non-material desires, rather it is based on realistic view of multiple ends and scarce means.

2.  Neutral:
Prof. Lionel Robbins, "economics is a neutral science". It is not concerned with normative aspects. Thus, economics is free from the responsibility of making value judgements. It is no longer its function to examine the right or wrong of an economic activity.

3.   Universal in Nature:
Prof. Lionel Robbins' definition about economics is universal in nature. It takes into account all types of human wants,  material or non-material, as well as of all types of persons whether living in society or not.

4.  Comprehensive and Clear:
Prof. Robbins' definition about economics is comprehensive and clear because it is based on realities of life. no one can deny the fact of unlimited wants and limited resources of the people. Therefore, his statement proves comprehensive and clear everywhere and every time.

5.  Free of Animadversions:
In the light of Robbins' definition about economics, "economics cannot be called a dismal science, pig philosophy, science of break and butter, science of selfishness and greediness or degrading sordid inquiry because it takes no responsibility of selecting the ends". They may be good or bad. Economics is directly concerned with the multiple ends and scarce means, cannot be animadversioned.

6.  Analytical Study:
Prof. Robbins' definition about economics is an analytical study which has widened the scope of economic science. Because it does not deal with particular place or time, rather it applies on all places, all times and all the people.


Robbins claims that his definition is superior to the earlier definitions but so many economists have criticized his view about economics from different angles and have put a strong defence of Marshallian economics. According to them, it is very difficult for economists to divest their discussions completely of all normative significance. R. W Souter, T. Parsons, Lindley Fraser, A. L. Macfie and Barbara Wooton etc. have pointed out the following drawbacks of Robbins' definition about economics.

1.  Economics is not Only a Science but also an Art:
Prof. Robbins has completely ignored the reality that basic objective of all the social science is to increase the human welfare. Thus Economics as a queen of social sciences should be with basic objective of human welfare because economics is not only a science but by acting upon its principles, human life can be developed.

2.  Economics can not be Neutral:
Economics is not a neutral science but in practical life people expect advices for the solutions of economic problems from economic experts.

3.  It ignores Economic Planning and Economic Development:
Prof. Robbins' definition economics does not explain the concept of economic planning and economic development. While in modern economics both of these concepts are very important branches of economics. Through which a nation can increase its income and prosperity, while Robbins just explain the concept of means and the consumption only which is not sufficient.

4.  It Ignores Human Touch:
In the Robbins' definition about economics the importance of human being is completely ignored, while economics is something more than a science. In its study there is a n important aspect of human values also.

5.  Scope of Economics Made too Wide:
According to Prof. Lionel Robbins, "Economics takes into account all types of human wants in response to the scarce resources". Since search for wants has been abandoned, the scope of economics has been widened to include phenomena, which are not strictly economic.

6.  It Ignores Macroeconomics:
Prof. Robbins emphasized only on how resources are allocated and how prices are determined while economics is much than this. In economics we study how national income is generated, how employment level is determined, how economic fluctuations occur, what is inflation, what is over population, and how can these be controlled, etc.

7.  It Lacks Social Implications:
Robbins' definition about economics emphasizes on choice of individual only which has no particular significance because individual choice having no social implications cannot form the subject matter of economics.

8.  Economics is Not a Positive Science:
Prof. Robbins made economics a positive science while economics depicts human behaviours, which are not constant. Therefore, its laws state that given certain conditions certain results will follow. Thus economics is not like  physical sciences.

Although there are a few drawbacks in the definition of economics given by Prof. Lionel Robbins, even then so many modern economists explain the scope and nature of economics in the light of Robbins' idea of multiple ends and scarce means.

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