ECONOMOC LEVERS. A TOOL TO SAVE THE SHRINKING ECONOMY Essay

ECONOMOC LEVERS. A TOOL TO SAVE THE SHRINKING ECONOMY - essay ExampleAdam smith represents classical, Alfred Marshal represents the neo-classical school of thoughts and the moderns are represented by Lionel Robbins.Adam smith (1723-1790) who is known as a father of economics, in his work An enquiry into the causes and nature of wealth of nations defined economics first time in 1776. He, defining economics said thatThe above mentioned book of smith has been divided into four parts Consumption, production, exchange and distribution of wealth. He came up with an opinion that the wealth, goods and services are produced in every country in conformism with the laws. Concerning the exchange and with regard to distribution of wealth, he developed some laws for mutual exchange and with regard to distribution of wealth. The concept of wealth given by Smith was misinterpreted as well as misunderstood therefore, Ruskin and Carlyle, the renowned social reformers of their own time, declared ec onomics a dismal (negative) branch of knowledge. They said that Smiths definition motivates the wad for wealth worship and make them selfish. Wealth is the mean to reach the end not the end in itself. After the criticism of Ruskin and Carlyle on Smiths system Alfred Marshall came into play and rectifying many faults and defined economics in a different way. He said Economy is the study of mans action in the average business of life. It enquires, how does he get his income and how does he use it. More precisely, Economics tells how to earn money and how to consume it (Heather, 2000)Prof. Robbins developed a new definition of economics. As per himEconomics is the study of human behavior as a relationship between ends and scarce means which have alternative uses. There are tierce pillars of Robins theory which help it to sustain and be considered. These pillars are mentioned below. Wants are unlimited and so they compel us to select very urgent wants for having maximum satisfaction .The means, to pay off these unlimited wants, are limited and create the problem of scarcity.As the means can be use alternatively, a new problem of choice is created. Lets come across this concept with an example suppose a buyer reaches the market with limited money in his pocket to purchase, then he faces the problem of choice. In another(prenominal) words, he has to take a decision what to purchase and what not to (Harvey 1996)Economic LeversThere are a number of economic levers which can be used to keep the economy back on track. We will discuss some of them and analyze that how it helps to aid the economy (Alois & Perelman, 1994).1. Deflation2. Devaluation3. Price Trend4. Nationalization5. Liquidity resource6. Fiscal policy7. Rate of interest 8. Employment rate9. Global Trade.1. Deflation When a decrease in the prices of the commodities and goods occur then we can