Introduction to Economics

The economy is arguably the most pressing issues in the world of politics today. The world has been in a great recession for years now, and it has had a large impact on many countries from all over the globe. Because of this global economic crisis, the economy is a number one priority of leaders. In the recent presidential election, the economy played a huge role in the decisions of voters, as it should. I believe the economy should be the foremost factor in votes of any level, local or national. I am creating this blog as a public service to inform the public of the workings of the economy, and news relating to it. In this blog, I will explain how the economy has changed, what changes the economy, and the economic future, along with other subtopics of the economy. I believe any individual who wants to be involved with politics must know very much about this topic.

Economy is defined by the Oxford Advanced Learner's Dictionary as "the relationship between production, trade, and the supply of money in a particular country or region." Economy runs off of two rules that work with each other: the Law of Supply and the Law of Demand. Together, these laws show the relationship between the abundance of a good and its price. As a good becomes less abundant, the demand for that good rises, driving up the price. The system works backwards as well. When there is a surplus of a good, the demand is not as high, and the price is lowered. A very easy way to think of this is gasoline pricing. Gasoline was once a very abundant resource. Because of its high supply, the price of gasoline was fairly cheap. In recent years, oil has become increasingly difficult to obtain because of its limited supply. As a result, gasoline prices have increased rapidly over recent years. When gasoline was in high supply, the demand, along with the price, was low, but as gasoline becomes less abundant, it is in higher demand and the price grows.

Another very important term to know is recession. A recession is defined as "a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in real gross domestic product (GDP), real income, employment, industrial production and wholesale-retail sales" by the National Bureau of Economic Research. This definition could be rather long and difficult to follow for the uneducated, but it is fairly simple. A recession a rather short bout of economic inactivity, but even though it only lasts for a matter of months, it has a visible effect on many of the parts of the economy nationwide. This will be discussed in greater detail in later blog posts that will delve into the workings of the economy.

Sources:

http://oald8.oxfordlearnersdictionaries.com/dictionary/economy

http://www.sophia.org/economic-basics-supply-and-demand-tutorial

http://www.merriam-webster.com/dictionary/recession
http://www.investopedia.com/ask/answers/08/cause-of-recession.asp#axzz2E84uBqJI