ECONOMY
“It’s a recession when your neighbour loses his job; it’s a depression when you lose your own.”
― Harry S. Truman
When I decided to write on this topic...i questioned myself,
"What is the economy?"
Well, to begin with, in layman terms, any activity related to production, consumption, and trade of goods and services in an area is called "economy". An economy of any country is governed by a few characteristics. These are culture, laws, history, and geography, among other factors, and it evolves due to necessity.
When I understood what is the economy, the next basic question that arises is
"How does the economy of a country work?"
To decide the working of an Economy in a country, three basic principles come into my mind.
(1) A country's standard of living (that defines the economic conditions of a country) depends on its ability to produce goods and services;
(2) When the government prints too much money, the prices of goods in a country reach sky-rocketing price (or rise) [this phenomenon is also called inflation]
and
(3) Our society occasionally faces a short-run tradeoff between inflation and unemployment rate due to the extremely high population and low availability of jobs.
Now we know "What" is economy, "how" does the economy work in a country? but "why" economy?
"Why is the economy necessary for a country?"
Well, to be blunt and basic, Economy helps us to thrive and survive. if you wonder How!?
Here is my view:
I wouldn't say if Economy is important, or unimportant. I would say the ECONOMY IS!
From times immemorial, we have been practising economy without even knowing we did!
production of goods, exchange of goods (barter system), selling of goods...everything that is in human nature is the ECONOMY.
Moreover, you will be surprised to know that the Economy doesn't just concern itself with money! A system where no money is involved is part of the economy too. A simple example that I already discussed is the Barter system which is the economy!
Good economic conditions are probably the most important means of human survival, stability and peace among different (tribes in the past) and nations in the present!
-Rashi Mohan
