Economising resources is the essence of economic problem. Explain

We know that economic problem arises due to the following three points.
  • Unlimited human wants
  • Scarce availability of resources
  • Alternative uses of the scarce resources
Now, because of these reasons, every economies need to face the economic problem. One way-out of this problem is judicious use of the resources. This is what we mean by economising resources. This means making use of the available scarce resources in a best way in order to obtain a maximum satisfaction from it. No matter, how well a particular economy is endowed with resources, these resources will be relatively scarce to fulfil its unlimited wants. While allocating the resources to any particular use, every economies need to evaluate the cost in terms of sacrifice of the other possible uses. To allocate the scarce resources in the best possible manner, an economy needs to analyse the cost (i.e. the opportunity cost) of allocating the resources to one use while sacrificing the other uses. So there arises a need to economise our resource utilisation. We need to use that technique in the production of any commodity which is more efficient and fruitful as we cannot bear the cost of unnecessary resource wastage.  
Hence, we can say that economising resources is the essence of economic problem. On the other way round, if there won't have been any scarcity, then there would not be any economic problem, hence, no need of economising resources.

 

  • -1
What are you looking for?