Understanding of the economy and its impact on society

The economy, like the air we breathe, is not subject to great attention of people, although many economic issues have a decisive effect on society. We realize the importance of this discipline only when something is wrong and, in recent years, has been able to show how some countries face major economic problems in their finances.

Society has various economic problems that can only be studied through the economic sciences, as long as we do so with a sense of involvement with the applications that the economy has with engineering and the way of production of goods administered by a company. government for a nation.

The study of the economy arises from the fact that it is impossible to acquire everything you want, since there are income limitations that are sometimes so severe that it is not possible for some social groups to cover their basic needs. These limitations of income have their cause and effect in society, which in turn dabble in poverty, having as sole source of study the economy, where solutions can be found to get out of that deplorable state of extreme poverty.

The study of the economy allows us to understand phenomena such as the unemployment that currently affects millions of people in the world, and that affects both people with high job training as engineers and doctors, and also unskilled labor as peddlers. In my country Venezuela we are living it, the inflation rates are so high that the way of life of the Venezuelan is under a critical situation, that does not differentiate nature of race, creed, profession and status within society, it is a situation that hits everyone equally.

The knowledge of the economy helps to understand the way in which the economic policy measures that the corresponding authorities take daily affect the population. For example, the increase in the value added tax (VAT) that has a direct effect on prices; or, the decrease of the income tax (ISR) in the higher income strata, which will favor a greater concentration of wealth. Also, the fluctuations in energy prices provided by the State, such as gasoline, which directly affects activities such as transport and has an indirect effect on the prices of goods and services that use energy as an input ( the inputs are the goods or consumable raw materials that are required to produce another good). Many of the economic policies taken by the state are not the ones mentioned above, let's evaluate and analyze them:

Price of gasoline.

Gasoline is a petroleum derivative that has a high cost in its production, in Venezuela gasoline has a very low cost, so low that it is already subsidized, that is why this is not what represents the high cost of goods in the country, if in one case there were an excessive increase in gasoline, then there would be plenty of reasons for public transport to increase its rates, the costs of food freight would increase, resulting in an increase in food. The conclusion of the case is that the increase of food goods, footwear, spare parts for cars, construction tools are not due to increased gasoline, are other factors that influence it.

Within these measures of economic policy are the decisions that have to do with the orientation of public spending. Thus, for example, the amount allocated to education has direct consequences both on the quality and quantity of this service provided to the student population. Not only the quality of the education of the student is influenced by the departure that the state designates, it is affected for good or bad the quality to teach of the teacher, since there are many tools in laboratories and other tools that the student must use. teacher who can be diminished if the game assigned to education is reduced. Part of the resources allocated to education must reach for the payment of teachers, staff and administrative staff, if this is not enough then the quality of life of these people will be affected, therefore the importance of knowing the diverse way in which the economy infers in these social aspects.

The economy also deals with very important issues for society as
They are, for example, deciding what goods to produce, how to do it and for whom. Is it appropriate to plant beans or corn to meet the food needs of the population? or; Is it preferable to produce fodder for livestock? Or is it better to invest in vineyards to export them?

Conclusion

The economy also refers to issues such as: the number of existing jobs, the type of these and their respective remunerations. As noted, these are issues that affect the life of every human being, regardless of where they live and the type of activity they do. In short, the economy deals with various problems that affect us all.

The study of the economy is not only necessary to understand it at the macro level, that is to say the behavior of the economy at the level of the big markets, the power to understand the political economy of a state, it is also important to understand the economy from the side micro, that is to understand all the links of the individual economy, for example the income of a family nucleus, it is necessary to know how the best distribution of that income can be given in the purchase of essential goods for that family nucleus.

I just hope that this brief review is a great contribution for the whole community.

Greetings.

Recommended bibliographical reference:

Astudillo Moya, Marcela. Fundamentals of Economics 1 Marcela Astudillo
Moya; Jorge Federico Paniagua Ballinas, collaborator. - Mexico: UNAM,
Institute of Economic Research: Probooks, 2012

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