How Economics Is in Every Choice We Make

Should I watch social media or study for an hour? Should I go for a run or rest at home? Believe it or not economics is behind the solutions to all these day to day questions. Economics is not just limited to money or finance but also to our day to day choices and resources. Should I watch netflix today or go to the park? The concept of opportunity cost is behind all these day to day decisions. Opportunity cost in simple terms means the value of the next best alternative sacrificed while making the decisions. Opportunity cost requires a tradeoff to be made, you sacrifice the utility you gain from doing one activity to do another utility. These kinds of decisions happen all the time. Let’s say you get Rs 200 for the week and now you have to think whether to spend it on snacks every day or save some for the weekend movie? It’s basically budgeting. Same thing with time. If you get one free hour you could scroll Instagram, study or nap. Whatever you pick you are losing out on the other two.

Even something simple like food, choosing chocolates over fruits is fun now but not great for health later. That’s how trade-offs work.

Once you start noticing these patterns you realize that you were already thinking like an economist without knowing it. It’s not always about graphs and formulas, just daily choices we all make whether we’re in school or running a country.