ABSTRACT

Economics arises from a basic imbalance that is evident throughout the world. On the one side there are resources which can be used to make goods and services. These are classified by economists into land (raw materials), labour and capital (machines). Additionally we sometimes include the entrepreneur (the person that brings factors of production together) as a resource. On the other side we have people’s wants. The worldwide economic fact of life is that people’s wants appear unlimited and exceed the resources available to satisfy these wants. This is true not just for people with low incomes, but for people with high incomes too. Clearly the basic needs of rich people are generally satisfied in terms of food, clothing and shelter, but it is evident that their material wants in terms of cars, property, holidays and recreation are rarely fully satisfied.