What is Economics?

Have you ever wondered why some are so rich and some so poor? Or why is it so hard to maintain high economic growth and levels of employment with price stability? Or why politicians do not deliver the good things they promise? If you struggle with the answers, you should take an economics course at The King’s College. The first thing you will learn here is that there are no free lunches. Such a revelation may earn our economics faculty the reputation of party poopers, but it may also be the most valuable lesson you will take away from your college education.

When a recession hits, people are invariably surprised—because they and their leaders never seem to learn that there is “No Free Lunch.” We learn as children to abide by the laws of nature. If we ignore gravity, gravity reminds us with bumps and bruises. When policy-makers design programs that ignore greed and selfishness, then those sad qualities of our fallen nature likewise leave us with economic bumps and bruises. When a politician offers “Free Lunches,” the laws of economics teach us that, before long, people will be starving. Economics is about cause and effect.

Meaning well does not get anyone an exemption from economics. Benevolent but economically ignorant leaders often bring devastation. The public would be better served by selfish but economically savvy leaders, if that were the only choice. Managing the economy without understanding market forces is like designing a spaceship without knowing mathematics or performing surgery without knowing anatomy. We cannot make sense of the world without the social sciences, and economics provides some of the most powerful social scientific tools.

Economics considers the trade-offs in every choice and how best to make decisions in a world of scarcity. Economics shows that market exchange is not a zero-sum game where one party benefits at the expense of the other. It tells us why allocation of resources and goods through market prices is better for the poor than bureaucratic control. Economics teaches that market integration without government interference is the short cut for the developing countries to catch up with the rich. Finally, it explains why an economic system based on Marxist or any other ungodly principles is doomed to collapse.

Are economics courses at The King’s College taught in a distinct way? Does God have anything to do with economics? Yes and yes! Our students are delighted to discover that the Word of God is full of directions for Christ’s disciples on what is good and just and fair in our economic lives. Thus the debate over policy issues does not revolve so much around the differences between the “left” and the “right” but between right and wrong.

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