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Social Economics – Definition

Social Economics Definition

Social economics is a study of the connection or relationship between social behavior and economics. It is an aspect of economics that studies how economic activities affect social behaviours and how the economy is also shaped by social trends and patterns. Social economic theories focus on how the economy affects societal patterns in terms of progression or regression of the society.

Social economics consider the interconnectedness of economics and social behaviors, it examines how social norms and beliefs affect consumer behaviour and in extension, their buying trends. Social economic theories should not be confused with traditional economic theories, these two concepts are quite different.

A Little More on What is Social Economics

Social economics is otherwise called socioeconomics, it studies how economic factors influence certain groups in society and how societal norms and philosophies affect consumer behavior.  As a result of diverse philosophies and ethics that shape human behavior in the society, those ethics directly or indirectly have an impact on the economy.

A human society is divided into different socioeconomic classes and these classes exhibit different behaviors. The spending habit of different socioeconomic classes also differ, as well as their choice of products. Social economics theories comprehensively study the relationship between economics and social behaviors that individuals exhibit.

KEY TAKEAWAYS

Here are the key points you should know about social economics;

  • Social economics is a branch of economics that focuses on the interconnectedness of economics and social behaviour. It is otherwise called socioeconomics.
  • These theories study how societal ethics, philosophies and norms influence economic patterns of consumers and their purchase patterns.
  • There are different socioeconomic classes in a community, these classes have unique attributes and are shaped by certain factors in the society.
  • For upper socioeconomic class for instance, they have more resources and financial ability to buy expensive goods and have higher pursuits than individuals that the low or extreme socioeconomic class.

Socioeconomic Class

A socioeconomic class comprises of individuals or families that possess similar economic characteristics. There are three socioeconomic classes that individuals or families can fall into, these are; high socioeconomic class, middle socioeconomic class, and low socioeconomic class. Also, there are three variables used in evaluating which socioeconomic class an individual belongs to, these are the level of education, type of profession/occupation and income of the individual. Ethnic background and family heritage are also variables assessed in certain cases.

Impact of Socioeconomic Status

The socioeconomic status of individuals in a society have great impacts on their perceptions of opportunities, their attitudes and economic behaviors. For instance, individuals in high socioeconomic class are believed to have higher education, qualifications and greater opportunity than those in the middle social class. Individuals in the middle social class also have an advantage over others in the low socioeconomic class.

Therefore, the socioeconomic status of individuals pay a major role in the opportunities they seek, their career or educational pursuits as well as their potential spending power. The American Psychological Association (APA) also recognize the important of the socioeconomic status of individuals.

Real World Example

In reality, children or individuals that come from low-income families have restricted access to education, career growth and other economic opportunities unlike those from middle or high-income families.

For example, children from middle or high-income families are exposed to more benefits than their counterparts from the low-income families. According to a study carried out by the Institute of Education Sciences under the aegis of the National Center for Education Statistics, people from low-income families do not enjoy the same benefits than those from high-income families.

While children from low-income families attend overcrowded schools with little or no facilities and underfunded education, individuals from high-income families have access to personal tutors, extra lessons, home tutorial and many others.

References for “Social Economics

https://www.investopedia.com/terms/s/social-economics.asp

https://en.wikipedia.org/wiki/Socioeconomics

https://www.emeraldinsight.com/doi/pdfplus/10.1108/eb013993

https://www.dictionary.com/browse/social-economics

https://mitpress.mit.edu/books/social-economics

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