Further Essays in Economics
Leon Maclaren

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THE FUNCTION AND SCOPE OF ECONOMICS

ECONOMICS is concerned with the community. Plainly if there were no communities, there would be no need of economics. Again, as each community consists of a number of human families and individuals living and working together, so economics is concerned with the life and work of these same families and individuals; but in one broad aspect only. The economist looks at all this manifold life and activity to try and understand how it is affected by the business of earning a living. Economics is the study of the relationships between human families and individuals living and working together in communities, in so far as these relationships are developed and modified in and about the business of making a living.

This would seem evident enough, and scarcely to need stating, were it not for the prevalence of the view that economics is primarily concerned with the production and distribution of wealth. The error into which students have been led by misconceiving the nature of their task, becomes more evident upon a consideration of the object of the study, indeed, of most human studies.

If a human being neglects to use one of his faculties, it withers: if he uses none of them at all, he dies. Evidently, one of the functions of human faculties is to sustain human life, and, in his better moments, man uses them for this purpose. Equally, though any human study may be pursued in order to maim and kill, yet all are better followed so that human beings may live, live more fruitfully, and even enjoy living. Like any other study, economics may be deliberately cultivated to learn how to exploit and plunder other people, but it is rare for even the study of economics to be so wilfully perverted. In the nature of things, each form of life desires its own good, and the usual object of economics, the desire which normally impels men to study it, is that human beings may live and live better. Thus not merely is economics as a study concerned with human beings in one general aspect of their relations with one another, but its object is to enhance and enrich the very life which is the subject of enquiry.

So far removed has the study turned in practice from its true sphere and proper function, however, so strongly has the accent shifted from human life to the production and distribution of wealth, that economists have come to regard human beings and human life as a means towards the end of producing and distributing wealth. Men, women and children are spoken of as labour, units of demand, manpower and so on. In the process the study has deteriorated from a liberal art, one of the humanities, to a sordid and arid calculation of dead numbers, materialist and confessedly unethical.

It has been said that the wise man judges of things by their end. The end of economics is human life, and it should be judged at all times by this criterion. What can be said for those who in their studies put means before ends, who judge of human beings by the production and distribution of wealth? Even in the narrow confines of their researches this inverstion of sense must work confusion. Wealth is not even a primary economic factor, being itself dependent on other economic factors, on human desires and labour in the natural universe. Claims or titles to wealth, such as money, are even further removed from the beginnings of making a living. Yet, money and its manipulation, are exalted to become the first and last considerations of many economists today.

A full understanding of the economic aspect of human life requires a knowledge and study of wealth, of money and of exchanges. To all these close attention must be given, but they must be kept in perspective, seen in their due relation to other and more vital agencies. After all, they belong to the artificial world, they are of men's devising. They do not and cannot exist independently of the rest of the universe: they cannot flourish in isolation. Their object should be human individual growth and fruition.

The object of economics, then, is that men may learn how to live and live more fruitfully. Its scope is limited to the study of families and individuals living and working together in communities, as their life and the relations between them develop and are modified in and about the business of making a living.

To do this, human activity must be kept in its context. Human beings are born into this world and are part of it. They are endowed with a faculty to create out of the natural universe an artificial world of imagination, ideas, creatures and things; but their artificial world exists within and is ever subject to the natural universe from which it is drawn. In the artificial world, as throughout the universe, powers are at work which are beyond human control. It is the function of economics to comprehend with ever increasing clarity and distinction how these forces affect human beings engaged in earning a living. The object of this understanding is that men may build their artificial world in conformity with these greater powers, so that the ends of their work may be as in their beginnings they were intended to be. At best, only the beginning of an action is under man's control, the end is not of his making. Economics is the understanding within its sphere of the relationship between these beginnings and these ends, so far as human imagination, thought and practice can comprehend this harmony.

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