1.1.1—Economics SL as a social science
- Syllabus
- First assessment 2022
- Objective
- 1.1.1
- Level
- SL
Economics studies social choices at micro and macro scales
Economics is a social science studying how people interact and use resources to improve economic well-being within institutions, values and the natural environment. Microeconomics studies individual consumers, firms and markets; macroeconomics studies economy-wide output, employment, inflation and policy.
Nine concepts organize analysis: scarcity, choice, efficiency, equity, economic well-being, sustainability, change, interdependence and intervention. An economic decision may improve one outcome while creating opportunity costs or distributional effects elsewhere.
Identify whether the issue is micro or macro, then select the concept that reveals the central relationship—for example scarcity for a resource constraint, equity for distribution, or intervention for a policy choice.
A household choosing energy use is microeconomic; economy-wide inflation is macroeconomic. A subsidy for renewable energy connects intervention, sustainability, change and interdependence.
Economics is not only money or business, and economic well-being is not identical to income. Positive-versus-normative methodology belongs to the neighbouring 1.2 Objective.