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Business Studies vs Economics, making the right course of study?

Business Studies? Economics? Are they the same? What are the differences? Making the initial choice of either subject is quite a challenging prospect as many students will have to make it with relatively little knowledge, and in many cases little experience, of subject content. There was a commonly expressed opinion several years ago, held by university Professors in particular, that Economics was a ‘ more demanding’ subject, but his can equally apply to both subjects.

There are perhaps two reasons for this. The first is that both subjects are heavily dependent upon basic skills acquired in other areas; numeracy and literacy come immediately to mind but one also should consider the benefits that ought to have been derived from the logical and analytical approaches utilised in sciences and humanities. The second reason relates to the fact that students are expected to apply techniques of analysis taught within the subject content to "real world problems" and that, without a certain amount of exposure to the commercial and political activities of the nation, it would be difficult for them to develop the contextual awareness required by examiners in either subject.

The "Key Skill" of problem solving is of great significance in the approach to both subjects, Business Studies has been a well integrated part of the A level portfolio in the Laude Lady Elizabeth School for some time. The A level has become fully accepted as one containing appropriate academic rigour and discipline. Changes in the Economics syllabus over recent years have followed the same route, that is to say, that much more case study driven material and analysis of current issues has now been included at the expense of a certain amount of micro-economic theory. Having described how the courses have become closer in terms of approach and assessment, the most obvious difference is perhaps in terms of the perspective adopted by the two subjects.

A good analogy would be....There are 2 students standing back to back one is looking inwards towards the firm or business, they are interested in what internal mechanisms make the business work, areas such as Marketing, Motivation, Organisation, Sources of Finance and Operations Management are studied in depth in Business Studies. The other student is looking at the external influences that will affect the business, such as macroeconomic issues of Inflation, Causes of Economic Growth, Unemployment, Recession, Balance of Payments and Exchange Rates are studied in depth to assess the influence these variables have on the individual business.

There are inevitably some areas of overlap. Microeconomics looks at the individual in the economy in relation to theories of demand and supply for example, and Business will look at areas such as branding and advertising in relation to consumer behaviour. Both also look at Globalisation, but from different perspectives.

In summary, Business Studies certainly takes the viewpoint of the firm (or organisation), and is concerned with the process of decision making within them. Virtually all study is therefore given a context, with the intention of exemplifying the need to consider all aspects of impact that any decision taken might have. All internal factors, operational, financial and human, will therefore be considered, together with external factors of competition, economic and social environments. The latter factors are seen as constraints and enablers on and for the organization. A strategic approach to such decision is always aimed for. In very simple terms a candidate might face a question such as “Given all the constraints the Chief executive of Firm A has, make a recommendation on what he/she should do to solve the problem.” In Economics, the overview of the economy is seen as the most central subject, with analysis of its constituent parts: producers, consumers and financial institutions seen as areas for study within it. The development of behavioural models for each of these is then adopted as the main approach in an attempt to explain and rationalize economic policy as implemented to control the economic forces at work within them. In simple terms Microeconomics looks at individual markets in considerable depth (e.g. the labour market, the market for oil or housing), whereas macroeconomics focuses on the economy of the nation and how the government might try to manage it (taxes, interest rates, government spending, balance of trade etc.) Students who begin either course should certainly be confident of their ability to handle simple numerical techniques and to construct rational and logical argument when presented with sets of information. An interest in current affairs is also very useful as it is unlikely that political and economic standpoints can be separated on a number of issues. An interest in the workings of City markets, money matters and management decision making is also valuable.

Both subjects will require the key concepts which are required for both subjects which are Knowledge, Application, Analysis and Evaluation.

In today’s world knowledge is easy to find, but to have value and relevance to the student in their future studies the other factors are vital and will be a key element of how these subjects will be taught in our school.

The choice is yours!

Inspirational Quotes

“If the only tool you have is a hammer, you tend to see every problem as a nail.”

Abraham Maslow

“You can teach a student a lesson for a day; but if you can teach him to learn by creating curiosity, he will continue the learning process as long as he lives.”

Clay P. Bedford

“Anyone who has never made a mistake has never tried anything new.”

Albert Einstein

“Aim for success, not perfection. Never give up your right to be wrong, because then you will lose the ability to learn new things and move forward with your life. Remember that fear always lurks behind perfectionism.”

David M. Burns

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Henry B Adams

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Oliver Wendell Holmes Jr.

“Much education today is monumentally ineffective. All too often we are giving young people cut flowers when we should be teaching them to grow their own plants.”

John W. Gardner

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G.K. Chesterton

“Why should society feel responsible only for the education of children, and not for the education of all adults of every age?”

Erich Fromm

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Mark Twain