Lionel Robbins published a book “An Essay on the Nature and Significance of Economic Science” in 1932. According to him, “Economics is a science which studies human behavior as a relationship between ends and scarce means which have alternative uses.”
The significant features of Robbins’ definition are as follows:
a) Ends refer to human wants. Human beings have an unlimited number of wants.
b) Resources or means, on the other hand, are limited or scarce in supply. A commodity is scarce if its demand is higher than its supply. In other words, the scarcity of a commodity is to be considered only concerning its demand.
c) The scarce means are capable of having alternative uses. Hence, anyone will choose the resource that will satisfy his particular wants. Thus, economics, according to Robbins, is a science of choice.
Merits of Robbin’s Definition
Economists like Macfie, Oscar, and Scitovsky accepted this definition.
Status of real science: It is a more exact science. Robbins clarified science has nothing to do with goodness or evil nature of the ends; According to him, Economics studies all economic activities without considering welfare.
Analytical definition represents human behavior: “problem of scarcity” Economics studies all kinds of human behavior for choices between ends and means. So it was claimed as a universal definition.
Criticisms
Robbins does not make any distinction between goods conducive to human welfare and goods that are not conducive to social well-being. We use scarce resources in the production of rice and alcoholic drink, but the production of rice promotes human welfare. In contrast, the production of alcoholic beverages is not conducive to social well-being. However, Robbins concludes that economics is neutral between ends.
In economics, we not only study the microeconomic aspects like how resources are allocated and how the price is determined, but we also consider the macroeconomic aspect like how national income is generated. But, Robbins has reduced economics merely to the theory of resource allocation.
Robbins’ definition does not cover the theory of economic growth and development
