How does economics relate to your daily life?

Answer 1

Economics "to some extent" has some application in the real life like "Law of Diminishing Marginal Utility" has a major application in the daily life. Many other theories are also helpful especially in calculating the financial budgets.

All our lives involve the principles of economics and their application, on a daily basis.

Long before economics was seen as a science and eons before the first dollar was minted, we were involved in the creation, use and distribution of wealth, which is what economics is all about.

Calling economics a science and consequently spending endless hours studying and analysing its principles and application is a valuable process; however it does tend to creep into the realms of mysticism from which myriad experts materialise and tell us at length what money means.

We already know what money means. We simply need to use it productively, and this is what the science of economics can teach us.

When a person checks their bank to see how much they can spend, goes shopping to spend it, and goes to work the next day to earn more, they're participating in applied economics, which they understand perfectly well - as does the child trotting alongside them in the store - provided nobody comes along to tell them it's all too hard for lay people to grasp. It isn't true: just use commonsense, don't spend more on general living expenses than you earn, and find something useful to do with the money left over after the weekly shop. And know when to seek advice from someone you trust to advise you impartially and in terms you can understand.

Anyone who tells you how to handle your money, or how the country, or the world, should handle its money, in terms that leave you totally baffled is no expert, though they're probably very good at gaining wealth through giving advice most people won't use because they forgot it all five minutes later.