Economics II – More Questions

One can argue that scarcity is a fact of nature and undomesticated animals do not really have an abundance of food and water as I claimed earlier. One can further argue that wild animals, without the knowledge of economics or by just plain being unable to reason, cannot successfully negotiate nature. As a result some over consume their food and become extinct, some fall victim to the changes in the environment and so on.

Unfortunately, both of the above are incomplete arguments. To say that there is scarcity in nature does not make economics any more meaningful. (Not for most people, but I'll get to that later.) Despite our knowledge of economics there are still millions of humans who do not have food and water. And for those who want to raise the argument of national boundaries, well, even within the boundaries of every nation there exist groups of people who face no scarcity whatsoever and groups of people who live in extreme abjection, facing scarcity of every sort. The animals of a region, at least, either flourish together or suffer together. In most instances they migrate together to greener pastures. And as for the second argument, well, it seems humans, for all their ability to reason, also over consume their natural resources and frequently fall victim to changes in the environment. In some cases the change in environment is brought about by their over consumption!

But there is yet another answer to both points of view. Modern humans didn't appear over night, and economics didn't always exist. There was a time when humans were more like wild animals and didn't know economics. Somehow those creatures who couldn't reason (well, not like us modern humans!) and didn't know economics, survived. And not only did they survive, but they survived well enough and long enough, as a species, to develop the methodical study of economics over the past several centuries. However, during the early stages of development of this species, perhaps the roughest time of all, when economics would have probably made the biggest impact, it was absent. If this science is so essential, that without it the species would be plunged into danger of extinction then why did it develop so late? Unlike, for example, hunting, or fishing, or agriculture? Perhaps even other sciences and technologies, like fire making, weaving, boat making? And even if we accept that some species may have become extinct due to lack of knowledge of economics, that doesn't explain the existence of so many others that also don't know economics (or can't reason, for that matter). If anything, humans, with their knowledge of economics, may be a bigger danger to many species, than those species' inability to formulate economic theory.

So,

1. Economics hasn't really removed scarcity for humans,
2. Economics wasn't really necessary for the survival of the human species, certainly not other species, and,
3. Despite having developed all these sophisticated economic theories, humans have actually become a threat to their own survival, by over consuming their resources, and also threat to other species.

My question remains: what justification, then, for the study of economics?

Economics I

What is the more important concept in economics? Value or scarcity? To me it seems the only thing of value in economics is scarcity. If a certain thing doesn't have scarcity then it doesn't have value.

Take the example of sunlight or air, for instance. There is an abundance of both of these and therefore in an economic sense they have no value. But as we have started to realize that air: clean air, breathable air, good air is becoming scarce we have started to attach economic value to it. Thus the various arrangements for cap & trade, pollution taxes etc. No one needs to be told how badly we need air. How much would one pay for a breath of air? Yet as long as it is abundant, not scarce, it has no value in economics! A perverse science indeed.

With that in mind I would like to examine how economics plays a part in human life. The classical definition of economics is of course the study of human behavior with regard to ends and means which are scarce and have alternate uses. That definition is almost taken for granted by all students of economics. "Means", "ends", "scarce" and "alternate uses" are like the cardinal directions on an economist's compass. But let's start at the beginning and ask, why are means scarce? Did not humans start out as most other animals? Much like deer, antelopes, wolves or lions? What ends do these animals live for? And what ends did the early humans live for? The only end for animals seems to be procreation. I doubt the early humans strove for something much higher. And most humans of these days don't strive for much else either. Behind all the struggles and achievements of modern humans that is one stark truth. There are few, very very few might I add, that strive for a higher or even different purpose. But for the vast majority the purpose of life is to procreate: to keep the individual genes and the species going.

The animals: the wolves, the antelopes, the lions and the deer, manage just fine without any knowledge of economics. Food is abundant, so is water and air. Sunlight is abundant. All conditions that were necessary for life to first begin are still there. For these animals and others, there is no scarcity. And if there is, it is part of nature. The natural scarcity that they faced is different from the economic scarcity modern humans are accustomed to. If the water dries up in one lake, there is yet another. If the leaves have all been eaten from one tree, there are still other trees. If one antelope gets away, there will be another to prey on. Nature, that gave rise to these animals, takes care of them. The territorial behavior of animals that we see is limited to only a few species and is not only temporary, but is also related to procreation. Outside of that animals share resources. If resources become scarce in one area, perhaps due to flood or fire, these animals move on to another area. I have little doubt that early humans behaved no differently from the other animals they shared their habitat with.

Early humans were not so different from animals in regard to both behavior and the purpose or end they were living for: they lived to procreate and they lived off the land. Modern humans have pretty much the same purpose they live for as well. And the means of meeting that end is still the same: we get all our resources from the land. So, if the means have remained the same and the end is the same too, where did economics come from?