English in applied economics

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Vladimir State University n.a. the Stoletov brothers Vladimir, Russia

Владимирский государственный университет имени Александра Григорьевича и Николая Григорьевича Столетовых Владимир, Россия

English in applied economics

Английский в прикладной экономической науке

Dobrynina E.V.

Добрынина Е.В.

My paper is devoted to some points of applied economics and their use in teaching English as ESP. The paper includes the following issues:

1. Applied economics. What is economics?

2. The study of scarcity and choice in economics.

3. What do economists do?

4. Microeconomics vs macroeconomics.

5. The basic economic problem.

6. ESP approach.

My work can be used in educational activities. My thesis was listened to and approved by at the Seminar of the VlSU Students' conference in April, 2014.

To begin with, economics is a social science that deals with the study of the allocation of scarce resources among unlimited and competing uses to satisfy human needs. One of the things that people discover every day is that you can't have everything. You are reminded of it every time you shop. Although you may see twenty or thirty items that you would really like to buy, you know that you will have to limit your selection to one or two. Everyone goes through life having to make choices, undoubtedly.

The point is that, every business, even sports teams, must choose from among the things they would like to have because they cannot have everything. Governments, too, cannot have everything. Every year the most important political debates concern questions about spending taxpayers' money.

In fact, neither individuals nor societies can have all the things they would like to have. There simply is not enough of everything. Economists note that there is no limit to the amount or kinds of things that people want. There is, however, a limit to the resources, things used to produce goods and services, available to satisfy those wants. Once that limit is reached, nothing else can be produced. In other words, when nation's resources (all its workers, factories, farms, etc.) artfully employed, the only way it will be able to increase the production of one thing will be by reducing the production of some other things.

So, human wants are unlimited, but the resources necessary to satisfy those wants are limited. Thus, the identical problem, the problem of scarcity is faced by every society.

The study of scarcity and choice in economics. Since there is not enough of everything, everyone-- individuals, business firms, and government-- needs to make choices from among the things they want. In the process they will try to economize, to get the most from what they have. With this in mind, we can define economics as the social science that describes and analyzes how society chooses from among scarce resources to satisfy its wants. The need to choose is imposed on us all by our income, wealth and ability to borrow. Individuals and families are limited by the size of their personal income, savings and ability to borrow. Similarly, business firms are limited by their profits, savings and borrowing power, and governments by their ability to tax and borrow as it is.

Evidently, income, savings, profits and taxes enable people, institutions and government to purchase goods, products you can see or touch, and services, work performed for pay that benefits others. The problem that each must face, however, is that once the decision has been made to choose one set of alternatives, one loses the opportunity to choose the other. Economists describe these kinds of trade-offs as opportunity costs. The opportunity cost of something is its cost measured in terms of what you have to give up to get it. Business is also faced with the problem of choices and opportunity costs, of course.

What do economists do?

Nature of the Work. Economists study the ways a society uses scarce resources such as land, labor, raw materials, and machinery to produce goods and services. They analyze the costs and benefits of distributing and consuming these goods and services. Economists conduct research, collect and analyze data, monitor economic trends, and develop forecasts. Their research might focus on topics such as energy costs, inflation, interest rates, farm prices, rents, imports, or employment. Most economists are concerned with practical applications of economic policy in a particular area, such as finance, labor, agriculture, transportation, real estate, environment, natural resources, energy, or health. They use their understanding of economic relationships to advise business firms, insurance companies, banks, securities firms, industry and trade associations, labor unions, government agencies, and others. On the other hand, economists who are primarily theoreticians may use mathematical models to develop theories on the causes of business cycles and inflation, or the effects of unemployment and tax legislation, etc.

Well, depending on the topic under study, economists devise methods and procedures for obtaining the data they need. For example, sampling techniques may be used to conduct a survey, and econometric modeling techniques may be used to develop forecasts. Preparing reports usually is an important part of the economist's job. He or she may be called upon to review and analyze all the relevant data, prepare tables and charts, and write up the results in clear, concise language. Being able to present economic and statistical concepts in a meaningful way is particularly important for economists whose research is policy directed.

Those economists who work for government agencies assess economic conditions in the United States and abroad and estimate the economic effects of specific changes in legislation or public policy. For example, they may study how the dollar's fluctuation against foreign currencies affects import and export markets. Most government economists are in the fields of agriculture, business, finance, labor, transportation, utilities, urban economics, or international trade. Economists in the U.S. Department of Commerce study domestic production, distribution, and consumption of commodities or services; those in the Federal Trade Commission prepare industry analyses to assist in enforcing Federal statutes designed to eliminate unfair, deceptive, or monopolistic practices in interstate commerce; and those in the Bureau of Labor Statistics analyze data on prices, wages, employment, productivity, and safety and health. An economist working for a state or local government might analyze regional or local data on trade and commerce, industrial and commercial growth, and employment and

unemployment, and project labor force trends.

On Working Conditions. Economists working for government agencies and private firms have structured work schedules. They may work alone writing reports, preparing statistical charts, and using computers and calculators. Or they may be an integral part of a research team. Most work under pressure of deadlines and tight schedules, and sometimes must work overtime. Their routine may be interrupted by special requests for data, letters, meetings, or conferences. Travel may be necessary to collect data or attend conferences. Economics faculty have flexible work schedules, and may divide their time among teaching, research, consulting, and administration.

On Employment. Economists and marketing research analysts held about 51,000 jobs in 1992. Private industry particularly economic and marketing research firms, management consulting firms, banks, securities and commodities brokers, and computer and data processing companies employed 7 out of 10 salaried workers. The remainder, primarily economists, were employed by a wide range of government agencies, primarily in the Federal Government. The Departments of State, Labor, Agriculture, and Commerce are the largest Federal employers of economists. A number of economists combine a full-time job in government or business with part-time or consulting work in academia or another setting.

Employment of economists analysts is concentrated in large cities for example, New York City, Washington, D.C., and Chicago. Some economists work abroad for companies with major international operations; for the Department of State and other U.S. Government agencies; and for international organizations, including the World Bank and the United Nations.

And besides the jobs described above, many economists held economics faculty positions in colleges and universities.

Training, Other Qualifications, and Advancement.

A bachelor's degree with a major in economics is sufficient for many entrylevel research, administrative, management trainee, and sales jobs. Economics majors can choose from a variety of courses, ranging from those which are intensely mathematical like microeconomics, macroeconomics, and econometrics, to more philosophical courses like the history of economic thought. Because of the importance of quantitative skills to economists, courses in mathematics, statistics, econometrics, sampling theory and survey design, and computer science are highly recommended.

Aspiring economists can gain experience gathering and analyzing data, conducting interviews or surveys, and writing reports on their findings while in college. This experience can prove invaluable later in obtaining a full-time position in the field, since much of their work in the beginning centers around these duties. Beginning workers also may do considerable clerical work, such as copying data, editing and coding questions, and tabulating survey results. With further experience, economists eventually are assigned their own research projects.

Graduate training increasingly is required for many economist jobs, and for advancement to more responsible positions. Economics includes many specialties at the graduate level, such as advanced economic theory, mathematical economics, econometrics, history of economic thought, international economics, and labor economics. Students should select graduate schools strong in specialties in which they are interested. Some schools help graduate students find internships or parttime employment in government agencies, economic consulting firms, financial institutions, or marketing research firms. Like undergraduate students, work experience and contacts can be useful in testing career preferences and learning about the job market for economists.

In the Federal Government, candidates for beginning economist positions generally need a college degree with a minimum of 21 semester hours of economics and 3 hours of statistics, accounting, or calculus. Competition is keen, however, and additional education or experience may be required for some jobs. For a job as a college instructor in many junior colleges and some 4-year schools, a master's degree is the minimum requirement. In most colleges and universities, however, a Ph.D. is necessary for appointment as an instructor. Similar to other disciplines, a Ph.D. and extensive publication are required for a professorship and for tenure.

In government, industry, research organizations, and consulting firms, economists who have a graduate degree usually can qualify for more responsible research and administrative positions. A Ph.D. is necessary for top positions in many organizations. Many corporation and government executives have a strong background in economics or marketing.

Persons considering careers as economists should be able to work accurately with detail since much time is spent on data analysis. Patience and persistence are necessary qualities since economists may spend long hours on independent study and problem solving. At the same time, they must be able to work well with others. Economists must be objective and systematic in their work and be able to present their findings, both orally and in writing, in a clear, meaningful way. Creativity and intellectual curiosity are essential for success in these fields, just as they are in other areas of scientific endeavor.

Job Outlook. Employment of economists is expected to grow about as fast as the average for all occupations through the year 2005. Most job openings, however, are likely to result from the need to replace experienced workers who transfer to other occupations, or retire or leave the labor force for other reasons.

Opportunities for economists should be best in private industry and in research and consulting firms, as some companies contract out for economic research services rather than support a staff of full-time economists. The growing complexity of the global economy and increased reliance on quantitative methods of analyzing business trends, forecasting sales, and planning purchasing and production should spur demand for economists. The continued need for economic analyses by lawyers, accountants, engineers, health services administrators, education administrators, urban and regional planners, environmental scientists, and others also should result in additional jobs for economists. Other organizations, including trade associations, unions, and nonprofit organizations, may offer job opportunities for economists. Employment of economists in the Federal Government should decline in line with the rate of growth projected for the Federal workforce as a whole. Slower than average employment growth is expected among economists in State and local government.

A strong background in economic theory, mathematics, statistics, and econometrics provides the tools for acquiring any specialty within the field. Those skilled in quantitative techniques and their application to economic modeling and forecasting and marketing research, including the use of computers, should have the best job opportunities.

Persons who graduate with a bachelor's degree in economics through the year 2005 should face keen competition for the limited number of economist positions for which they qualify. Related work experience conducting research, developing surveys, or analyzing data, for example while in school is a major asset in this competitive job market. Many graduates will find employment in government, industry, and business as management or sales trainees, or as research or administrative assistants. Economists with good quantitative skills are qualified for research analyst positions in a broad range of fields. Those with strong backgrounds in mathematics, statistics, survey design, and computer science may be hired by private firms for marketing research work. Those who meet State certification requirements may become high school economics teachers. The demand for secondary school economics teachers is expected to grow as economics becomes an increasingly important and popular course.

Candidates who hold a master's degree in economics have better employment prospects than bachelor's degree holders. Some businesses and research and consulting firms seek master's degree holders who have strong computer and quantitative skills and can perform complex research, but do not command the high salary of a Ph.D. Master's degree holders are likely to face competition for teaching positions in colleges and universities; however, some may gain positions in junior and community colleges.

Opportunities will be best for Ph.D.'s. Ph.D. graduates should have opportunities to work as economists in private industry, research and consulting firms, and government. In addition, employment prospects for economists in colleges and universities should improve due to an expected wave of retirements among college faculty.

On Earnings. According to a 1993 salary survey by the College Placement Council, persons with a bachelor's degree in economics received offers averaging $25,200 a year.

The median base salary of business economists in 1992 was $65,000, according to a survey by the National Association of Business Economists. Ninety percent of the respondents held advanced degrees. The highest salaries were reported by those who had a Ph.D., with a median salary of $78,000. Master's degree holders earned a median salary of $58,000, while bachelor's degree holders earned $51,000. The highest paid business economists were in the nondurable manufacturing, securities and investment, mining, banking, and real estate industries. The lowest paid were in academia and government.

The Federal Government recognizes education and experience in certifying applicants for entry level positions. In general, the entrance salary for economists having a bachelor's degree averaged about $18,300 a year in 1993; however, those with superior academic records could begin at $22,700. Those having a master's degree could qualify for positions at an annual salary of $27,800. Those with a Ph.D. could begin at $33,600, while some individuals with experience and an advanced degree could start at $40,300.

Economists in the Federal Government in non-supervisory, supervisory, and managerial positions averaged around $53,500 a year in 1993. Like other college faculty, economists entering careers in higher education may receive benefits such as summer research money, computer access, money for student research

assistants, and secretarial support.

On Related Occupations. Economists are concerned with understanding and interpreting financial matters, among other subjects. Others with jobs in this area include financial managers, financial analysts, accountants and auditors, underwriters, actuaries, securities and financial services sales workers, credit analysts, loan officers, and budget officers.

Economics deals with the problems of scarcity and choice that have faced societies and nations throughout history, but the development of modern economics began in the 17th century. Since that time economists have developed methods for studying and explaining how individuals, businesses and nations use their available economic resources. Large corporations use economists to study the ways they do business and to suggest methods for making more efficient use of their employees, equipment, factories, and other resources.

Top 10 economists of the world:

1. Adam Smith

2. John Maynard Keynes

3. Karl Marx

4. Milton Friedman

5. Joseph Stiglitz

6. David Ricardo

7. Thomas Malthus

8. Joan Robinson

9. Alfred Marshall

10. Vladimir Lenin.

Perhaps this is the worst crafted and most disingenuous list of top ten economists. There are two glaring absences and one glaring presence on this list despite it's many other flaws. Lenin has absolutely no place on this list and no place in any discussion of economics except when discussing disastrous failures (see Manya Gordon's Workers Before and After Lenin). Friedrich Hayek and Paul Samuelson are the two economists who each deserve top 5 spots. In fact you only really need the top 5 economists; after that everybody falls off in significance:

1. Adam Smith

2. Friedrich Hayek

3. John Maynard Keynes

4. Milton Friedman

5. Paul Samuelson

MICROECONOMICS VS MACROECONOMICS

Economists have two ways of looking at economics and the economy. One is the macro approach, and the other is the micro. Macroeconomics is the study of the economy as a whole; microeconomics is the study of individual consumers and the business firm.

Macroeconomics examines questions such as how fast the economy is running; how much overall output is being generated; how much total income. It also seeks solutions to macro-economic problems such as how employment can be increased, and what can be done to increase the output of goods and services. Microeconomics examines cause-and-effect relationships that influence choices of individuals, business firms and society.

It is concerned with things such as scarcity, choice and opportunity costs, and with production and consumption. Principal emphasis is given by micro economists to the study of prices and their relationship to units in the economy.

Factors of Production. The resources that go into the creation of goods and services are called the factors of production. The factors of production include natural resources, human resources, capital and entrepreneurship. Each factor of production has a place in economic system, and each has a particular function. People who own or use a factor of production are expecting a «return or reward.» This generates income which, as it is spent, becomes a kind of fuel that drives the economy.

Natural Resources or «Land». Natural resources are the things provided by nature that go into the creation of goods and services. They include such things as minerals, wildlife and timber resources. Economists also use the term «land» when they speak of natural resources as a factor of production. The price paid for the use of land is called rent. Rent becomes income to the owner of the land.

Human Resources or «Labor». Economists call the physical and mental effort that people put into the creation of goods and services labor. The price paid for the use of labor is called wages. Wages represent income to workers, who own their labor.

Capital. To the economist, physical capital (or «capital» as it is commonly called) is something created by people to produce other goods and services. A factory, tools and machines are capital resources because they can be used to produce other goods and services. The term capital is often used by business people to refer to money they can use to buy factories, machinery and other similar productive resources. Payment for the use of someone else's money, or capital, is called interest.

Entrepreneurship. Closely associated with labor is the concept of entrepreneurship, the managerial or organizational skills needed by most firms to produce goods and services. The entrepreneur brings together the other three factors of production. When they are successful, entrepreneurs earn profits. When they are not successful, they suffer losses. The reward to entrepreneurs for the risks, innovative ideas and efforts that they have put into the business, they obtain the money that remains after the owners of land, labor and capital have received their payments.

THE BASIC ECONOMIC PROBLEM

In fact, the world's resources are finite; therefore resources are scarce. 'Nothing in life is free' said my mother to me when I was younger and this proves to be true, even offers promising free this and free that are more often than not riddled by underlying conditions meaning that they in fact are not free despite claiming to be. In economic terms resources such as land, oil, clothes and food are not unlimited and thus are deemed scarce.

Economic agents can only own a limited amount of resources at any one particular time. For example an economic agent may refer to a household. If they earn say a salary of $100,000 annually, spend $25,000 on the household mortgage, $10,000 on their cars and after further compulsory expenditure they are left with $5,000 to spend as they please, they can only buy $5,000 of stuff and not more, thus they can only possess a specific amount of resources at one particular time. This is because money is not infinite and is thus scarce.

Resources which are scarce are economic goods; and those that are not are referred to as free goods. Free goods such as air and water are infinite and thus free. They are not of interest to economics which looks at the optimization of distribution of resources.

As the population of the planet expands, the number of free goods declines. Free goods are becoming scarce due to a rising population. For example land would have formerly been a free good but is no longer a reality.

People have a limited number of needs in order to survive, both material and emotional. In order to survive humans need physical things such as food, shelter and heat; but also humans require psychological things such as self-esteem and love. Without these things, humanity would not survive and progress to the next generation.

People will always strive for a better quality of living; thus there wants are unlimited. Despite there just being perhaps a dozen actual needs integral to a person's survival they will always strive for more, as is human nature. 'For humans enough is never enough' - Over the Hedge (a film where animals steal junk food from human homes for hibernation due to vast local deforestation, but also looks at the psychology of humans and their inescapable nature). Even the wealthiest of people would want to earn even more money or away from material gain may desire more friends or a loving relationship..

Resources are scarce and wants are infinite. This creates the basic economic problem. The contrast of scarce resources and infinite wants cause the basic economic problem.

The basic economic problem forces economic agents to make choices, to allocate there limited resources between competing uses. Economics is the study of resource allocation by economic agents as they attempt to best solve their respective economic problem.

Every choice involves a range of alternatives. Naturally if a person has Ј1,000 to invest he or she has a plethora of choices, places and methods in order to do this.

Choices can be ordered by benefit derived from each alternative. A rational economic agent will choose the most beneficial alternative. Using the example from above, if the person is presented with 5 savings accounts at 3%, 2.8%, 2.5%, 2.3% and 2% annual interest rate respectively, they can be ordered in descending order as it is most beneficial to receive 3% interest than 2.8% or 2.5% etc.

The benefit that would have otherwise come from the other alternatives is the opportunity cost of the decision. By making a choice, the economic agent is foregoing the benefit of the other choices, this loss of potential benefit is regarded by economists as the opportunity cost of the decision. If a company has the potential to produce 40 goods of A and 30 goods of B, but to produce 50 goods of A it can only produce 25 goods of B, the opportunity cost of 10 more of A is 5 of B.

Free goods have no opportunity cost. This is because no resources are sacrificed to consume free goods and thus the opportunity cost is none. A man with $5 will still retain his $5 after breathing in air for example.

The central problem of economics is to determine the most efficient ways to allocate the factors of production and solve the problem of scarcity created by society's unlimited wants and limited resources. In doing so, every society must provide answers to the following three questions:

1. What goods and services are to be produced, and in what quantities are they to be produced?

2. How are those goods and services to be produced?

3. Who will receive and consume (get to use) those goods and services?

Actually, the solution of these questions depends on the economic system of each society in particular.

Questions

1. What do economists do?

2. What is the problem of scarcity?

3. How can we define economics?

4. What is the opportunity cost of the thing?

5. What is the difference between macroeconomics and macroeconomics?

6. What are the basic factors of production?

7. What are the natural resources?

8. What is the capital?

9. What is the basic Economic Problem?

economic english cost production

Bibliography

1. Агабекян И.П. Английский для менеджеров; «Феникс»,344007, г. Ростов-на-Дону, 2003;-409 с.;

2. National Association of Business Economists, 28790 Chagrin Blvd., Suite 300, Cleveland, OH 44122;

3. The Margin Magazine, University of Colorado, 1420 Austin Bluffs Pkwy., Colorado Springs, CO 80918;

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