Tuesday, April 24, 2007

Economics for Dummies: By A Dummy

I am both intrigued and fascinated by Economics. Maybe because Economics is the only field in which two people can get a Nobel Prize for saying exactly the opposite thing. Or is it that Economists get to do it with Models!!

So even though I'm a dummy with Economics, I've been busy reading and trying to fathom some aspects. Honestly, my interests have soared high after I discovered a treasure trove of Economics in the form of a friendly blog by Ajay Shah

To start with I'll atempt to ask and answer three basic questions about economics: Why, What and Where?

Why? : Economics provide a framework for taking decisions by the Goverments and the Management of firms. While it studies the production, distribution and consumption of products and services, Economics also studies human behaviour to address issues of demand and supply. To me, this makes Economics an important subject to get serious about. Despite the horrible jargons and graphs. Incidentally, I don't have any problems with the curves!!! :))

What? : Economics can be analysed in two ways, Micro Economics and Macro Economics. The macro-economic environment ( tax, monetory and fiscal policies, etc ) defines the setting within which the firms operate. The micro-economic environment(eg. cost analysis, marginal analysis, etc) provides the conceptual underpinning for the tools of financial decision making. Simple, no?

Where? : This one is easy. Just head to Ajay Shah's Blog (some gems: 1, 2, 3, 4, 5) , the Indian Economy Blog or Alex Thomas's Blog. You'll learn much more from them rather than any thing else because there you don't find the intimidating mumbo jumbo of Economics. And I found this amazing series on Economics for the citizen, which is very useful.

Enough for a day. I'll come back with more on this "interest"-ing subject!!

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