ROBBINS' DEFINITION:

ECONOMICS IS A SCIENCE OF
SCARCITY
• Robbins not only criticised Marshall's definition and other welfare
definitions of economics but also provided a new definition which he
considered to be more scientific and correct. He has given this
definition in his famous book, "An Essay on the Nature and
Significance of Economic Science, " which he brought out in 1931.
• According to Robbins, economics studies the problems which have
arisen because of the scarcity of resources. Nature has not provided
mankind sufficient resources to satisfy all its wants. Therefore, the
people have to choose for which ends or for which wants the
resources are to be utilised.
• Thus, according to Robbins, economics is the science of scarcity and it
studied how the scarce resources are allocated among their different
uses.
• Thus, he has given the following definition: "Economics is the science
which studied human behaviour as a relationship between ends and
scarce means which have alternative uses."
• This definition is based upon the following three facts:
• 1. Unlimited wants. The first fact on which Robbins' definition is based is
that man's wants are unlimited. In his definition 'ends' implies wants and
for satisfying wants the man uses resources. That man's wants are
unlimited is a very important and fundamental fact of economic life of the
people. If man's wants were limited, then no economic problem would
have arisen. But in the real life of the people there is no limit to their
wants; when one want is satisfied, another want crops up. An important
thing to know about wants is that they are not of equal intensity; some are
more intense than others. It is because of the different intensities of the
wants that people are able to allocate the resources to satisfy their
different wants.
• 2. Scarce means. The second element which gives rise to economic
problem is that resources are scarce in relation to wants. If the resources
like wants were unlimited, no economic problem would have arisen
because in that case all wants could have been satisfied and there would
have been no problem of choosing between the wants and allocating the
resources between them. Because the resources are scarce, all wants
cannot be satisfied. Therefore, human beings have to decide for the
satisfaction of which wants the resources should be used and which wants
should be left unfulfilled. It should be noted that means or resources here
refer to natural productive resources, man-made capital goods, consumer
goods, money and time available with men, etc. If the means or resources
were unlimited, then we would have obtained goods in the desired
quantities because in that state of affairs goods would have been free
goods. But in the real life we cannot obtain goods free or without price; we
have to pay price for them and make efforts to obtain them.
• 3. Alternative uses of means. The third fact on which Robbins' definition is
based is that resources or means have various alternative uses. In other
words, the resources can be put to various uses. For instance, coal can be
used as a fuel for the production of industrial goods, it can be used for
running trains, it can be used for domestic cooking purposes and for so
many other purposes. Likewise, monetary resources can be utilised for the
production of essential consumer goods, for the production of capital
goods and so many other goods. It has to be decided how the resources
have to be allocated among different uses. The man or society has,
therefore, to choose the uses for which resources have to be employed. If
the resources would have a single use only, the question of choice would
not have arisen at all. In the case of single use of resources, they would
have been employed for the uses which they have. It is because of the
various alternative uses of the resources that we have to decide about the
best allocation of resources.
• We thus see that Robbins' definition stands on the above-mentioned three
facts, namely, unlimited wants, scarce resources and alternative uses of the
resources. According to him, economics studies human behaviour
regarding how he satisfies his wants with the scarce resources. According
to him, economics is a human science and not a mere social science. It
studies man in society or without society when he is confronted with the
problem of allocating scarce resources to satisfy his unlimited wants. An
important thing to note about Robbins' definition is that Robbins does not
distinguish between material and non-material, between welfare and non-
welfare. According to him, economics studies man's activities in regard to
all goods and services, whether they are material or immaterial, provided
they satisfy the wants of the people.
Economics is neutral between ends
• Besides, whether the goods and services are conducive to human welfare
or not, economics should study them if they satisfy the wants of some
men. It is also worth noting that in view of Robbins, economics does not
deal with the question as to what ends should be achieved, that is, what
wants should be satisfied and what not, because in this regard man himself
has to decide. Economics itself does not make a choice. Economist only
tells in what ways the given ends or wants can be achieved with the
minimum possible resources. What ends or wants should be selected for
satisfaction is not the concern of economists. Whether the ends chosen by
man are good or bad, noble or ignoble, economics should study them,
because the task of economist is not to praise or condemn but only to
analyse and explain. To decide about the desirability or otherwise of a
thing is beyond the scope of economics. Therefore, according to Robbins,
economics is neutral between ends.
Economics as a Science of Choice
• It follows from the definition of Robbins that economics is a science
of choice. It deals with how the resources of society should be
allocated to the satisfaction of different wants. Whenever the
resources are scarce, and the wants are many, the question of choice
arises. The man has to choose between the wants to which resources
are to be allocated. Thus, Professor Robbins remarks, "When time
and means for achieving ends are limited and capable of alternative
application and the ends are capable of being distinguished in order
of importance, then behaviour necessarily assumes the form of
choice." It is thus clear that economics is the science of choice.