Supplementary resources by topic. Scarcity is one of 51 key economics concepts identified by the Council for Economic Education (CEE) for high school classes.
On this page:
Definitions and Basics
Scarcity, at Wikipedia
In economics, scarcity is defined as a condition of limited resources, where society does not have sufficient resources to produce enough to fulfill subjective wants. Alternatively, scarcity implies that not all of society’s goals can be attained at the same time, so that trade-offs are made of one good against others. Neoclassical economics, the dominant school of economics today, defines its field as involving scarcity: following Lionel Robbins’ definition, economics is a science which studies human behavior as a relationship between ends and scarce means which have alternative uses….
Competition, from the Concise Encyclopedia of Economics
“Competition,” wrote Samuel Johnson, “is the act of endeavoring to gain what another endeavors to gain at the same time.” We are all familiar with competition—from childhood games, from sporting contests, from trying to get ahead in our jobs. But our firsthand familiarity does not tell us how vitally important competition is to the study of economic life. Competition for scarce resources is the core concept around which all modern economics is built….
Efficiency, from the Concise Encyclopedia of Economics
To economists, efficiency is a relationship between ends and means. When we call a situation inefficient, we are claiming that we could achieve the desired ends with less means, or that the means employed could produce more of the ends desired….
Scarcity and Choices, at SocialStudiesforKids.com.
Think of a thing that you like to have. What would your life be like if you suddenly couldn’t get any more of it?…
Some fruits and vegetables are scarce in markets sometimes because those fruits or vegetables grow only at certain times of the year. Because the supply of fruits and vegetables is lower, there is a better chance that those fruits and vegetables will be scarce, or not always available. You may find that the market has no strawberries at all. Why? Either no shipments of strawberries came in, or so few strawberries came in that by the time you got there, they were all gone….
In the News and Examples
Diane Coyle on the Soulful Science, EconTalk podcast.
Diane Coyle talks with host Russ Roberts about the ideas in her new book, The Soulful Science: What Economists Really Do and Why it Matters. The discussions starts with the issue of growth–measurement issues and what economists have learned and have yet to learn about why some nations grow faster than others and some don’t grow at all. Subsequent topics include happiness research, the politics and economics of inequality, the role of math in economics, and policy areas where economics has made the greatest contribution….
Daniel Botkin on Nature, the Environment and Global Warming, EconTalk podcast.
Daniel Botkin, ecologist and author, talks with EconTalk host Russ Roberts about how we think about our role as humans in the natural world, the dynamic nature of environmental reality and the implications for how we react to global warming….
Natural Resources, from the Concise Encyclopedia of Economics
The earth’s natural resources are finite, which means that if we use them continuously, we will eventually exhaust them….
A Little History: Primary Sources and References
Lionel Robbins, biography, from the Concise Encyclopedia of Economics
Robbins’ most famous book was An Essay on the Nature and Significance of Economic Science, one of the best-written prose pieces in economics. That book contains three main thoughts. First is Robbins’ famous all-encompassing definition of economics that is still used to define the subject today: “Economics is the science which studies human behavior as a relationship between given ends and scarce means which have alternative uses.”…
Who coined the phrase “the dismal science”? The Secret History of the Dismal Science: Economics, Religion, and Race in the 19th Century, by David M. Levy and Sandra J. Peart. Econlib, January 22, 2001.
Everyone knows that economics is the dismal science. And almost everyone knows that it was given this description by Thomas Carlyle, who was inspired to coin the phrase by T. R. Malthus’s gloomy prediction that population would always grow faster than food, dooming mankind to unending poverty and hardship.
While this story is well-known, it is also wrong, so wrong that it is hard to imagine a story that is farther from the truth. At the most trivial level, Carlyle’s target was not Malthus, but economists such as John Stuart Mill, who argued that it was institutions, not race, that explained why some nations were rich and others poor….
They Clapped:Â Can Price-Gouging Laws Prohibit Scarcity?, by Michael Munger. Econlib, January 8, 2007.
Hurricane “Fran” smashed into the North Carolina coastline at Cape Fear at about 8:30 pm, 5 September 1996. It was a category 3, with 120 mph winds, and enormous rain bands. It ran nearly due north, hitting the state capital of Raleigh about 3 am, and moving north and east out of the state by morning….
There were no generators, ice, or chain saws to be had, none. But that means that anyone who brought these commodities into the crippled city, and charged less than infinity, would be doing us a service….