Economics is definitely the way of life as it deals with the important concepts of equity and efficiency. While optimum production as well as allocation of resources is important for the advancement of any economy, ensuring that the resources are being equally distributed amongst the all is equally important. By ensuring equity, the government does ensure that it does take steps to reduce the problems of absolute property whereby each individual has some resources to live with.
For example, usually the government ensures that the richer who enjoys greater allocation of resources pays a higher amount of tax thereby limiting his purchasing capacity to an extent, while the poor pays an amount of tax in proportion of the resources allocated to him, so that if he wishes, he can consume more. Such a concept of equity ensures that the rich does not become richer by taking away all the resources of the world with his wealth, leaving the poor people to suffer.
On the other hand, efficient allocation of resources is equally important as it ensures that the resources are allocated efficiently to the people so that it does not result in scarcity of demand (Kaine et al. 2017). For example, if the oil supply is scarce, and everyone in the society is allowed to consume oil considering the question of efficiency, it will undoubtedly result in scarcity as the demand will exceed the supply. Hence, the concept of efficiency is important, as once the demand of the goods increases and it is fairly distributed amongst all, the rich and the poor will suffer alike because of the scarcity of the good brought in as a result of the overconsumption of the product. This justifies the reason of having a perfectly competitive market or even having a price policy in the first place, as though free allocation of resources can ensure justice and fairness, the same can never ensure efficient allocation of resources that in turn will result in scarcity of products and services.
Hence, what to allocate, for whom to allocate and how to allocate are the important questions that equity and economic efficiency revolves around, and the same helps in the sustenance of human beings, ensuring availability of sufficient resources. Hence, it can be concluded that economics is indeed a way of life.
References:
Kaine, G., Greenhalgh, S., Boyce, W., Lourey, R., Young, J., Reed, E., Keenan, B. and Mackay, S., 2017. A microeconomic perspective on the role of efficiency and equity criteria in designing natural resource policy. Ecology and Society, 22(1).
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