Economics in General
Economics is a field that applies in our daily lives. However, many people do not take time to understand its concepts. As a result, knowledge on this vital subject is not familiar to most people. Many individuals conduct business affairs without incorporating basic economic principles in these activities. It is sad that young educated people are part of this category. Lack of this information is because of the nature of the subject, as well as people’s ignorance. Economics is a complex subject that involves various aspects of science and art. It contains various theories, some of which are contradictory. Additionally, most young people are less interested in detailed issues, hence their limited knowledge in matters related to economics. Moreover, most people in their formative years ignore this subject. They prefer adopting certain myths as opposed to exploring the details of this topic.
Such myths include the aspect of inflation. Some educated people relate price rises in a country to reliance on foreign oil, increase in oil costs as well as high demand of clients in developed and developing countries. In addition, the public has different mythologies regarding consumption of certain goods and services. For instance, most people believe that consumption is the most vital part of a country’s economy. Other myths related to consumption include the idea that surplus consumption of goods and services is an attribute of the liberated market in an entrepreneurial structure. Likewise, some people believe that centralized interest rate guidelines can improve a country’s economy. Such myths hinder the spread of economic facts to the public, especially the young and educated individuals.
On average, a person’s misinterpretations of economics concepts are comparable to the misunderstanding exhibited by the “Cargo Cults” in the 1940s. According to this myth, ancient ethnic groups believed that supernatural silvery birds could bring them magic presents after they cleaned their homes and prayed to the cargo gods. This illustrates the public’s ignorance on vital aspects of life. For example, many individuals carry out business activities without considering the implications of these actions. Some of these people happen to be educated people, with most of them being in their formative years. Because of this ignorance, some policy makers formulate irrational economic laws. Consequently, these policies result into reduced economic growth rates. As such, citizens in these countries live in abject poverty and are not able to meet their basic needs. For example, America’s revenue reduces by $5000 each year for every household because of destructive obstacles to worldwide trade.
Knowledge on fundamental economic principles would eliminate certain mistakes in the government institutions, as well as private businesses. It is disturbing to see the level of ignorance in relation to economics and the consequences of this unawareness. Facts that are less important spread fast, with the public adopting such ideas easily. For example, people all over the world easily adopted the idea provided by scientists stating that the earth was not the center of the universe. On the other hand, the public is slow to approve fundamental principles of economics. Most of them prefer implementing economic myths due to their assumption that this discipline is complex. In conclusion, it is vital for business people to familiarize themselves with trade philosophies. These principles aid in improving commercial institutions by increasing their gains. Moreover, these ideas are applicable and crucial in the public and private sectors.