Price fixing is an agreement between participants on the same side in a market to buy or sell a product, service, or commodity only at a fixed price, or maintain the market conditions such that the price is maintained at a given level by controlling supply and demand. The intent of price fixing may be to push the price of a product as high as possible leading to profits for all sellers but may have the goal to fix, discount, or stabilize prices; the defining characteristic of price fixing is any agreement regarding price, whether expressed or implied. Price fixing requires a conspiracy between buyers; the purpose is to coordinate pricing for mutual benefit of the traders. For example and retailers may conspire to sell at a common "retail" price. Price fixing is permitted in some markets but not others. In neo-classical economics, price fixing is inefficient; the anti-competitive agreement by producers to fix prices above the market price transfers some of the consumer surplus to those producers and results in a deadweight loss.
International price fixing by private entities can be prosecuted under the antitrust laws of many countries. Examples of prosecuted international cartels are those that controlled the prices and output of lysine, citric acid, graphite electrodes, bulk vitamins. In the United States, price fixing can be prosecuted as a criminal federal offense under Section 1 of the Sherman Antitrust Act. Criminal prosecutions must be handled by the U. S. Department of Justice, but the Federal Trade Commission has jurisdiction for civil antitrust violations. Many state attorneys general bring antitrust cases and have antitrust offices, such as Virginia, New York, California. Private individuals or organizations may file lawsuits for triple damages for antitrust violations and, depending on the law, recover attorneys fees and costs expended on prosecution of a case. Under American law, exchanging prices among competitors can violate the antitrust laws; that includes exchanging prices with the intent to fix prices or the exchange affecting the prices individual competitors set.
Proof that competitors have shared prices can be used as part of the evidence of an illegal price fixing agreement. Experts advise that competitors avoid the appearance of agreeing on price. Since 1997, US courts have divided price fixing into two categories: vertical and horizontal maximum price fixing. Vertical price fixing includes a manufacturer's attempt to control the price of its product at retail. In State Oil Co. v. Khan, the US Supreme Court held that vertical price fixing is no longer considered a per se violation of the Sherman Act, but horizontal price fixing is still considered a breach of the Sherman Act. In 2008, the defendants of United States v LG Display Co. United States v. Chunghwa Picture Tubes, United States v. Sharp Corporation, heard in the Northern District of California, agreed to pay a total sum of $585 million to settle their prosecutions for conspiring to fix prices of liquid crystal display panels; that was the second largest amount awarded under the Sherman Act in history.
In Canada, it is an indictable criminal offence under Section 45 of the Competition Act. Bid rigging is considered a form of price fixing and is illegal in both the United States and Canada. In the United States, agreements to fix, lower, stabilize, or otherwise set a price are illegal per se, it does not matter if the price agreed upon is reasonable or for a good or altruistic cause or the agreement is unspoken and tacit. In the United States, price-fixing includes agreements to hold prices the same, discount prices, set credit terms, agree on a price schedule or scale, adopt a common formula to figure prices, ban price advertising, or agree to adhere to prices that are announced. Although price fixing means sellers agreeing on price, it can include agreements among buyers to fix the price at which they will buy products. Price fixing is illegal in Australia under the Competition and Consumer Act 2010, with similar prohibitions to the US and Canadian prohibitions; the Act is enforced by the Australian Competition and Consumer Commission.
Section 48 of the Competition and Consumer Act 2010 explicitly states, "A corporation shall not engage in the practise of resale price maintenance." A broader understanding of the statutory provision is in Section 96of the Competition and Consumer Act 2010, which broadly defines what can be resale price maintenance. New Zealand law prohibits price fixing, among most other anti-competitive behaviours under the Commerce Act 1986; the act covers practices similar to that of US and Canadian law, it is enforced by the Commerce Commission. Under the EU commission's leniency programme, whistleblowing firms that co-operate with the antitrust authority see their prospective penalties either wiped out or reduced. British competition law pr
A central bank, reserve bank, or monetary authority is the institution that manages the currency, money supply, interest rates of a state or formal monetary union, oversees their commercial banking system. In contrast to a commercial bank, a central bank possesses a monopoly on increasing the monetary base in the state, generally controls the printing/coining of the national currency, which serves as the state's legal tender. A central bank acts as a lender of last resort to the banking sector during times of financial crisis. Most central banks have supervisory and regulatory powers to ensure the solvency of member institutions, to prevent bank runs, to discourage reckless or fraudulent behavior by member banks. Central banks in most developed nations are institutionally independent from political interference. Still, limited control by the executive and legislative bodies exists. Functions of a central bank may include: implementing monetary policies. Setting the official interest rate – used to manage both inflation and the country's exchange rate – and ensuring that this rate takes effect via a variety of policy mechanisms controlling the nation's entire money supply the Government's banker and the bankers' bank managing the country's foreign exchange and gold reserves and the Government bonds regulating and supervising the banking industry Central banks implement a country's chosen monetary policy.
At the most basic level, monetary policy involves establishing what form of currency the country may have, whether a fiat currency, gold-backed currency, currency board or a currency union. When a country has its own national currency, this involves the issue of some form of standardized currency, a form of promissory note: a promise to exchange the note for "money" under certain circumstances; this was a promise to exchange the money for precious metals in some fixed amount. Now, when many currencies are fiat money, the "promise to pay" consists of the promise to accept that currency to pay for taxes. A central bank may use another country's currency either directly in a currency union, or indirectly on a currency board. In the latter case, exemplified by the Bulgarian National Bank, Hong Kong and Latvia, the local currency is backed at a fixed rate by the central bank's holdings of a foreign currency. Similar to commercial banks, central banks incur liabilities. Central banks create money by issuing interest-free currency notes and selling them to the public in exchange for interest-bearing assets such as government bonds.
When a central bank wishes to purchase more bonds than their respective national governments make available, they may purchase private bonds or assets denominated in foreign currencies. The European Central Bank remits its interest income to the central banks of the member countries of the European Union; the US Federal Reserve remits all its profits to the U. S. Treasury; this income, derived from the power to issue currency, is referred to as seigniorage, belongs to the national government. The state-sanctioned power to create currency is called the Right of Issuance. Throughout history there have been disagreements over this power, since whoever controls the creation of currency controls the seigniorage income; the expression "monetary policy" may refer more narrowly to the interest-rate targets and other active measures undertaken by the monetary authority. Frictional unemployment is the time period between jobs when a worker is searching for, or transitioning from one job to another. Unemployment beyond frictional unemployment is classified as unintended unemployment.
For example, structural unemployment is a form of unemployment resulting from a mismatch between demand in the labour market and the skills and locations of the workers seeking employment. Macroeconomic policy aims to reduce unintended unemployment. Keynes labeled any jobs that would be created by a rise in wage-goods as involuntary unemployment: Men are involuntarily unemployed if, in the event of a small rise in the price of wage-goods to the money-wage, both the aggregate supply of labour willing to work for the current money-wage and the aggregate demand for it at that wage would be greater than the existing volume of employment.—John Maynard Keynes, The General Theory of Employment and Money p11 Inflation is defined either as the devaluation of a currency or equivalently the rise of prices relative to a currency. Since inflation lowers real wages, Keynesians view inflation as the solution to involuntary unemployment. However, "unanticipated" inflation leads to lender losses as the real interest rate will be lower than expected.
Thus, Keynesian monetary policy aims for a steady rate of inflation. A publication from the Austrian School, The Case Against the Fed, argues that the efforts of the central banks to control inflation have been counterproductive. Economic growth can be enhanced by investment such as more or better machinery. A low interest rate implies that firms can borrow money to invest in their capital stock and pay less interest for it. Lowering the interest is therefore considered to encourage economic growth and is used to alleviate times of low economic growth. On the other hand, raising the interest rate is used in times of high economic growth as a contra-cyclical device to keep the economy from overheating and avoid market bubbles. Further goals of monetary policy are stability of interest rates, of the financial market, of the foreign exchange market. Goals cannot be separated fr
A price is the quantity of payment or compensation given by one party to another in return for one unit of goods or services.. A price is influenced by both production costs and demand for the product. A price may be imposed on the firm by market conditions. In modern economies, prices are expressed in units of some form of currency. Although prices could be quoted as quantities of other goods or services, this sort of barter exchange is seen. Prices are sometimes quoted in terms of vouchers such as trading stamps and air miles. In some circumstances, cigarettes have been used as currency, for example in prisons, in times of hyperinflation, in some places during World War II. In a black market economy, barter is relatively common. In many financial transactions, it is customary to quote prices in other ways; the most obvious example is in pricing a loan, when the cost will be expressed as the percentage rate of interest. The total amount of interest payable depends upon credit risk, the loan amount and the period of the loan.
Other examples can be found in other financial assets. For instance the price of inflation-linked government securities in several countries is quoted as the actual price divided by a factor representing inflation since the security was issued. "Price" sometimes refers to the quantity of payment requested by a seller of goods or services, rather than the eventual payment amount. This requested amount is called the asking price or selling price, while the actual payment may be called the transaction price or traded price; the bid price or buying price is the quantity of payment offered by a buyer of goods or services, although this meaning is more common in asset or financial markets than in consumer markets. Economic price theory asserts that in a free market economy the market price reflects interaction between supply and demand: the price is set so as to equate the quantity being supplied and that being demanded. In turn these quantities are determined by the marginal utility of the asset to different buyers and to different sellers.
Supply and demand, hence price, may be influenced by other factors, such as government subsidy or manipulation through industry collusion. When a commodity is for sale at multiple locations, the law of one price is believed to hold; this states that the cost difference between the locations cannot be greater than that representing shipping, other distribution costs and more. The paradox of value was debated by classical economists. Adam Smith described what is now called the diamond – water paradox: diamonds command a higher price than water, yet water is essential for life and diamonds are ornamentation. Use value was supposed to give some measure of usefulness refined as marginal benefit while exchange value was the measure of how much one good was in terms of another, namely what is now called relative price. One solution offered to the paradox of value is through the theory of marginal utility proposed by Carl Menger, one of the founders of the Austrian School of economics; as William Barber put it, human volition, the human subject, was "brought to the centre of the stage" by marginalist economics, as a bargaining tool.
Neoclassical economists sought to clarify choices open to producers and consumers in market situations, thus "fears that cleavages in the economic structure might be unbridgeable could be suppressed". Without denying the applicability of the Austrian theory of value as subjective only, within certain contexts of price behavior, the Polish economist Oskar Lange felt it was necessary to attempt a serious integration of the insights of classical political economy with neo-classical economics; this would result in a much more realistic theory of price and of real behavior in response to prices. Marginalist theory lacked anything like a theory of the social framework of real market functioning, criticism sparked off by the capital controversy initiated by Piero Sraffa revealed that most of the foundational tenets of the marginalist theory of value either reduced to tautologies, or that the theory was true only if counter-factual conditions applied. One insight ignored in the debates about price theory is something that businessmen are keenly aware of: in different markets, prices may not function according to the same principles except in some abstract sense.
From the classical political economists to Michal Kalecki it was known that prices for industrial goods behaved differently from prices for agricultural goods, but this idea could be extended further to other broad classes of goods and services. Marxists assert that value derives from the volume of necessary labour time exerted in the creation of an object; this value does not relate to price in a simple manner, the difficulty of the conversion of the mass of values into the actual prices is known as the transformation problem. However, many recent Marxists deny. Marx was not concerned with proving. In fact, he admonished the other classical political economists for trying to make this proof. Rather, for Marx, price equals the average rate of profit. So if the average rate of profit is 22% prices would reflect cost-of-production plus 22%; the perception that there is a transformation problem in Marx stems from the injection of Walrasian equilibrium theory into Marxism where there is no such thing as equilibrium.
Price is co
Adam Smith was a Scottish economist and author as well as a moral philosopher, a pioneer of political economy and a key figure during the Scottish Enlightenment known as"The Father of Economics" or"The Father of Capitalism". Smith wrote two classic works, The Theory of Moral Sentiments and An Inquiry into the Nature and Causes of the Wealth of Nations; the latter abbreviated as The Wealth of Nations, is considered his magnum opus and the first modern work of economics. In his work, Adam Smith introduced his theory of absolute advantage. Smith studied social philosophy at the University of Glasgow and at Balliol College, where he was one of the first students to benefit from scholarships set up by fellow Scot John Snell. After graduating, he delivered a successful series of public lectures at Edinburgh, leading him to collaborate with David Hume during the Scottish Enlightenment. Smith obtained a professorship at Glasgow, teaching moral philosophy and during this time and published The Theory of Moral Sentiments.
In his life, he took a tutoring position that allowed him to travel throughout Europe, where he met other intellectual leaders of his day. Smith laid the foundations of classical free market economic theory; the Wealth of Nations was a precursor to the modern academic discipline of economics. In this and other works, he developed the concept of division of labour and expounded upon how rational self-interest and competition can lead to economic prosperity. Smith was controversial in his own day and his general approach and writing style were satirised by Tory writers in the moralising tradition of William Hogarth and Jonathan Swift. In 2005, The Wealth of Nations was named among the 100 best Scottish books of all time. Smith was born in the County of Fife, Scotland, his father Adam Smith, was a Scottish Writer to the Signet and prosecutor and served as comptroller of the customs in Kirkcaldy. In 1720, he married Margaret Douglas, daughter of the landed Robert Douglas of Strathendry in Fife, his father died two months after he was born.
The date of Smith's baptism into the Church of Scotland at Kirkcaldy was 5 June 1723 and this has been treated as if it were his date of birth, unknown. Although few events in Smith's early childhood are known, the Scottish journalist John Rae, Smith's biographer, recorded that Smith was abducted by gypsies at the age of three and released when others went to rescue him. Smith was close to his mother, who encouraged him to pursue his scholarly ambitions, he attended the Burgh School of Kirkcaldy—characterised by Rae as "one of the best secondary schools of Scotland at that period"—from 1729 to 1737, he learned Latin, mathematics and writing. Smith entered the University of Glasgow when he was 14 and studied moral philosophy under Francis Hutcheson. Here, Smith developed his passion for liberty and free speech. In 1740, Smith was the graduate scholar presented to undertake postgraduate studies at Balliol College, under the Snell Exhibition. Smith considered the teaching at Glasgow to be far superior to that at Oxford, which he found intellectually stifling.
In Book V, Chapter II of The Wealth of Nations, Smith wrote: "In the University of Oxford, the greater part of the public professors have, for these many years, given up altogether the pretence of teaching." Smith is reported to have complained to friends that Oxford officials once discovered him reading a copy of David Hume's A Treatise of Human Nature, they subsequently confiscated his book and punished him for reading it. According to William Robert Scott, "The Oxford of time gave little if any help towards what was to be his lifework." Smith took the opportunity while at Oxford to teach himself several subjects by reading many books from the shelves of the large Bodleian Library. When Smith was not studying on his own, his time at Oxford was not a happy one, according to his letters. Near the end of his time there, Smith began suffering from shaking fits the symptoms of a nervous breakdown, he left Oxford University in 1746. In Book V of The Wealth of Nations, Smith comments on the low quality of instruction and the meager intellectual activity at English universities, when compared to their Scottish counterparts.
He attributes this both to the rich endowments of the colleges at Oxford and Cambridge, which made the income of professors independent of their ability to attract students, to the fact that distinguished men of letters could make an more comfortable living as ministers of the Church of England. Smith's discontent at Oxford might be in part due to the absence of his beloved teacher in Glasgow, Francis Hutcheson, well regarded as one of the most prominent lecturers at the University of Glasgow in his day and earned the approbation of students and ordinary residents with the fervor and earnestness of his orations, his lectures endeavoured not to teach philosophy, but to make his students embody that philosophy in their lives, appropriately acquiring the epithet, the preacher of philosophy. Unlike Smith, Hutcheson was not a system builder. Smith began delivering public lectures in 1748 in Edinburgh, sponsored by t
An electrode is an electrical conductor used to make contact with a nonmetallic part of a circuit. The word was coined by William Whewell at the request of the scientist Michael Faraday from two Greek words: elektron, meaning amber, hodos, a way; the electrophore, invented by Johan Wilcke, was an early version of an electrode used to study static electricity. An electrode in an electrochemical cell is referred to as either a cathode; the anode is now defined as the electrode at which electrons leave the cell and oxidation occurs, the cathode as the electrode at which electrons enter the cell and reduction occurs. Each electrode may become either the anode or the cathode depending on the direction of current through the cell. A bipolar electrode is an electrode that functions as the anode of one cell and the cathode of another cell. A primary cell is a special type of electrochemical cell in which the reaction cannot be reversed, the identities of the anode and cathode are therefore fixed; the anode is always the negative electrode.
The cell can be discharged but not recharged. A secondary cell, for example a rechargeable battery, is a cell in which the chemical reactions are reversible; when the cell is being charged, the anode becomes the positive and the cathode the negative electrode. This is the case in an electrolytic cell; when the cell is being discharged, it behaves like a primary cell, with the anode as the negative and the cathode as the positive electrode. In a vacuum tube or a semiconductor having polarity the anode is the positive electrode and the cathode the negative; the electrons exit the device through the anode. Many devices have other electrodes to control operation, e.g. base, control grid. In a three-electrode cell, a counter electrode called an auxiliary electrode, is used only to make a connection to the electrolyte so that a current can be applied to the working electrode; the counter electrode is made of an inert material, such as a noble metal or graphite, to keep it from dissolving. In arc welding, an electrode is used to conduct current through a workpiece to fuse two pieces together.
Depending upon the process, the electrode is either consumable, in the case of gas metal arc welding or shielded metal arc welding, or non-consumable, such as in gas tungsten arc welding. For a direct current system, the weld rod or stick may be a cathode for a filling type weld or an anode for other welding processes. For an alternating current arc welder, the welding electrode would not be considered an anode or cathode. For electrical systems which use alternating current, the electrodes are the connections from the circuitry to the object to be acted upon by the electric current but are not designated anode or cathode because the direction of flow of the electrons changes periodically many times per second. Electrodes are used to provide current through nonmetal objects to alter them in numerous ways and to measure conductivity for numerous purposes. Examples include: Electrodes for fuel cells Electrodes for medical purposes, such as EEG, ECG, ECT, defibrillator Electrodes for electrophysiology techniques in biomedical research Electrodes for execution by the electric chair Electrodes for electroplating Electrodes for arc welding Electrodes for cathodic protection Electrodes for grounding Electrodes for chemical analysis using electrochemical methods Inert electrodes for electrolysis Membrane electrode assembly Electrodes for Taser electroshock weapon Chemically modified electrodes are electrodes that have their surfaces chemically modified to change the electrode's physical, electrochemical, optical and transportive properties.
These electrodes are used for advanced purposes in research and investigation
Supply management (Canada)
Supply management is a national agricultural policy framework used in Canada that coordinates supply and demand of dairy and eggs through production and import control and pricing mechanisms designed to prevent shortages and surpluses, to ensure farmers a fair rate of return and Canadian consumer access to a high-quality and secure supply of these sensitive products. The supply management system was authorized by the 1972 Farm Products Agencies Act, which established the two national agencies that oversee the system. Five national supply management organizations, the SM-5 Organizations — Egg Farmers of Canada, Turkey Farmers of Canada, Chicken Farmers of Canada, the Canadian Hatching Egg Producers and the Ottawa-based Canadian Dairy Commission, a Crown corporation — in collaboration with provincial and national governing agencies and committees, administer the supply management system; the Agriculture and Agri-Food Canada federal department is responsible for both the Canadian Dairy Commission and its analogue for eggs and turkey products, the Farm Products Council of Canada.
In the dairy industry, the supply management system implements the federated provincial policy through the CMSMC, CDC, three regional milk pools — Newfoundland's, the five eastern province and four western provinces — and provincial milk marketing boards. Since 1970, the CMSMC has set the yearly national industrial raw milk production quota or Market Sharing Quota and the MSQ share for each province to ensure Canada to match production with domestic need and to remain self-sufficient in milk fat; each province allocates MSQs to individual dairy farmers. Supply management mechanisms such as import controls were recognized as a valid practice and protected under Article XI of the 1947 General Agreement on Tariffs and Trade. During the Uruguay round of negotiations, Article XI was lost and tariffs were introduced to protect Canada's domestic dairy; the Canadian dairy industry was not part of trade negotiations in 1994 when the North American Free Trade Agreement came into effect. As a result of Canada's forced removal of some export subsidies with the establishment of the World Trade Organization in 1995, the federal government and the CDC updated the pricing system to be more stringent, a system that remains in place in 2018.
During the 2004 WTO Doha Development Round trade negotiations in Geneva, that had begun in 2001, Canada's supply management system was under attack by all their trading partners for the first time. Of the 193,492 farms in Canada in 2017, 16,351, representing 12 per cent, were under supply management; the controls provided by supply management have allowed the federal and provincial governments to avoid subsidizing the sectors directly, in contrast to general practice in the European Union and the United States. Supply management's supporters say that the system offers stability for producers, service providers and retailers. Detractors have criticized tariff-rate import quotas, price-control and supply-control mechanisms used by provincial and national governing agencies and committees; the policy has been described as regressive and protectionist and costly with money transferred from consumers to producers through higher prices on milk and eggs which some label as a subsidy. Canada's trade partners posit.
While many federal and provincial politicians from major parties "have long maintained support for a supply-managed system for dairy and egg farmers," there has been ongoing debate about SM. A 2018 report based on government data and the 2017 Nielsen's Fresh Milk Price Report, showed that although it has always been claimed that Canadians pay higher dairy prices than other countries, the price of 1 litre of liquid milk in Canadian dollars in Canada was $1.50 compared to $1.57 in Australia, $1.61 in the USA a litre, $1.83 in New Zealand. The Organisation for Economic Co-operation and Development maintained in 2017 that Canada's "export growth would be boosted if Canada phased out its Canadian dairy supply management policies."Supply management was one of many issues in Comprehensive Economic and Trade Agreement, a free-trade agreement between Canada, the European Union and its member states and Comprehensive and Progressive Agreement for Trans-Pacific Partnership negotiations and the United States Mexico Canada Agreement.
Under the October 1, 2018 United States Mexico Canada Agreement, the supply management system remained intact, Canada opened the domestic market by 3.6% and Class 7 was eliminated. Canada's supply management system, which encompasses "five types of products: dairy and turkey products, table eggs, broiler hatching eggs", "coordinates production and demand while controlling imports as a means of setting stable prices for both farmers and consumers."In Canada, the dairy supply management system is administered by the federal government through the Ottawa-based Canadian Dairy Commission a Crown corporation. The Agriculture and Agri-Food Canada federal department is responsible for both the Canadian Dairy Commission and its analogue for eggs and turkey products, the Farm Products Council of Canada. In total, there are about 12,000 dairy farms, 2,800 chicken farmers, 1,000 regulated egg farmers who produce table eggs and broiler hatching eggs, 551 turkey farmers, that operate under supply management.
According to the 2016 Canadian Census of Agriculture, there are 193,492 farms in Canada. There are five national organizations, known jointly as the SM-5 Organizations, that administer or su
Economics is the social science that studies the production and consumption of goods and services. Economics focuses on the behaviour and interactions of economic agents. Microeconomics analyzes basic elements in the economy, including individual agents and markets, their interactions, the outcomes of interactions. Individual agents may include, for example, firms and sellers. Macroeconomics analyzes the entire economy and issues affecting it, including unemployment of resources, economic growth, the public policies that address these issues. See glossary of economics. Other broad distinctions within economics include those between positive economics, describing "what is", normative economics, advocating "what ought to be". Economic analysis can be applied throughout society, in business, health care, government. Economic analysis is sometimes applied to such diverse subjects as crime, the family, politics, social institutions, war and the environment; the discipline was renamed in the late 19th century due to Alfred Marshall, from "political economy" to "economics" as a shorter term for "economic science".
At that time, it became more open to rigorous thinking and made increased use of mathematics, which helped support efforts to have it accepted as a science and as a separate discipline outside of political science and other social sciences. There are a variety of modern definitions of economics. Scottish philosopher Adam Smith defined what was called political economy as "an inquiry into the nature and causes of the wealth of nations", in particular as: a branch of the science of a statesman or legislator a plentiful revenue or subsistence for the people... to supply the state or commonwealth with a revenue for the publick services. Jean-Baptiste Say, distinguishing the subject from its public-policy uses, defines it as the science of production and consumption of wealth. On the satirical side, Thomas Carlyle coined "the dismal science" as an epithet for classical economics, in this context linked to the pessimistic analysis of Malthus. John Stuart Mill defines the subject in a social context as: The science which traces the laws of such of the phenomena of society as arise from the combined operations of mankind for the production of wealth, in so far as those phenomena are not modified by the pursuit of any other object.
Alfred Marshall provides a still cited definition in his textbook Principles of Economics that extends analysis beyond wealth and from the societal to the microeconomic level: Economics is a study of man in the ordinary business of life. It enquires how he uses it. Thus, it is on the one side, the study of wealth and on the other and more important side, a part of the study of man. Lionel Robbins developed implications of what has been termed "erhaps the most accepted current definition of the subject": Economics is a science which studies human behaviour as a relationship between ends and scarce means which have alternative uses. Robbins describes the definition as not classificatory in "pick out certain kinds of behaviour" but rather analytical in "focus attention on a particular aspect of behaviour, the form imposed by the influence of scarcity." He affirmed that previous economists have centred their studies on the analysis of wealth: how wealth is created and consumed. But he said that economics can be used to study other things, such as war, that are outside its usual focus.
This is because war has as the goal winning it, generates both cost and benefits. If the war is not winnable or if the expected costs outweigh the benefits, the deciding actors may never go to war but rather explore other alternatives. We cannot define economics as the science that studies wealth, crime and any other field economic analysis can be applied to; some subsequent comments criticized the definition as overly broad in failing to limit its subject matter to analysis of markets. From the 1960s, such comments abated as the economic theory of maximizing behaviour and rational-choice modelling expanded the domain of the subject to areas treated in other fields. There are other criticisms as well, such as in scarcity not accounting for the macroeconomics of high unemployment. Gary Becker, a contributor to the expansion of economics into new areas, describes the approach he favours as "combin assumptions of maximizing behaviour, stable preferences, market equilibrium, used relentlessly and unflinchingly."
One commentary characterizes the remark as making economics an approach rather than a subject matter but with great specificity as to the "choice process and the type of social interaction that analysis involves." The same source reviews a range of definitions included in principles of economics textbooks and concludes that the lack of agreement need not affect the subject-matter that the texts treat. A