Economics as an Applied

Science, as a Social
Science
Prepared by: Darel Suelto
Objectives :

The learners…
1. Define applied science and social science;
2. Differentiate applied science and social science;
and
3. Explain economics as an applied science and
social science.
 Economics – is a study of economic
activities of a man. It is only concerned
with the wealth-getting and the wealth-
using activities of a man. Economics is
concerned with the optimal distribution of
resources in society.
Economics is Pure or Applied Science?
A pure science furnishes tools and applied
science works with these tools. Similarly,
Economics as pure science, formulates
various laws and applied economics
applies them in practice in solving various
problems.
Cont…
•According to Adam Smith and A.C. Pigou Economics
studies the causes of material wealth. They gave a
very narrow scope to the study of economics by
limiting it only to those activities relating to wealth.
•According to Prof. Marshall, “Economics is a study of
economic activities of a man. It is only concerned with
the wealth getting and wealth-using activities of a
man,”.
 Cont…
Prof. A.C. Pigou also restricted the scope of economics to the study
of economic welfare. Robbins finds the welfare definition of
economics rather restrictive as it excludes non-material things from
its scope. Services of doctors, teachers, lawyers, domestic servants
etc. are scarce and satisfy wants in our daily life but they are
nonmaterial. Similarly, all economic activities are not conductive to
economic welfare. For example, the activities of manufactures of
liquors and opium are opposed to welfare. Economics studies how
wealth is generated, exchanged, distributed and consumed.
Exchange includes determination of value of commodities, money,
banking, international trade, foreign exchange etc. in distribution we
study the determination of rent, wages interest and profit. We study
the factors that determine a country’s national income, savings,
investment, output and employment and these factors promote
economic growth. The growth with stability forms the subject matter
of modern economics.
•Applied science is generally engineering which
develops technology, although there might be
dialogue between basic science and applied
science (research and development). Medical
sciences such as medical microbiology are
examples of applied sciences.
Economics is the scientific study of the
ownership, use, and exchange of scarce
resources – often shortened to the science of
scarcity. Economics is regarded as a social
science because it uses scientific methods to
build theories that can help explain the
behavior of individuals, groups, and
organization.
•This includes a variety of ways – from
understanding how minds work, to how
societies as a whole function. The major social
sciences are Anthropology, Archaeology,
Economics, Geography, History, Law, Linguistics,
Politics, Psychology and Sociology.
 Activity: Write 5 differences between
Economics and Applied Economics on the box
provided.
Applied Economics Social Economics
Assessment:
1. Why is economic considered applied science?
2. Why is economic considered a social science?
Assignment:
1. Write a reflection paper about Economics as an
Applied Science and as a Social Science.
THANK YOU!