On Economics: What is it?

With new experiences and study, I always update the definition and scope of Economics in my mind. Today, I thought I should share with others, what nowadays, is in the uppermost layer of my mind. There are two aspects of the things, one is like iron, vitamin, enzymes etc which are observable, their nature and characteristics are studied in physics, chemistry, and biology. On the other hand, there is an immaterial existence that is conscience, which is unobservable and creates the human behavior. Social sciences deal with this study of human behavior from the different point of views under different assumptions and theoretical framework. Economics is a social science because it deals with the human behavior of choices. Unlike Natural science, in which material object follows laws of nature, Economics, as a social science deals with conscious that makes choices not under any strict law of nature. Rather choices are made by human beings as in independent conscious which is completely different from material objects.


Scope of Ethics in Economics

Ethics in Economics has two main broad trajectories, Microeconomics and Macroeconomics. The one dealing with Microeconomics talks about right and wrong of human and firms, but it is of less use because this is subject of religion and morality to be taught in schools and religious seminaries.
The other strand of ethical literature talks about ethics (right and wrong) of Macroeconomics. For examples, it talks about distributive justice. How the distribution of wealth will be a justice? What share labor should earn from output? This subject has long history and much as been written on this topic. The Marginalist Revolution promoted by John Bates Clark and others supported that marginal product of labor is their share in output. The Marginal Revenue product theory is at the heart of Neo-Classical school of thought. Pareto, Walras, Menger, Jevons, were supporters and promoter of this marginal product version of theory of distribution.
Indeed the topic of ethics in the domain of Macroeconomics is Justice. Ethics tells what is right and what is wrong, and doing right is justice. In the domain of Macroeconomics, ethics tells what is right in distribution of wealth. How much should be the share of Labor in output?
Anyhow this is my point of view, however, scope of Ethics is not limited to theory of distributive justice, it touches all the edges of debate that deals justice.

rck model

Ramsey Cass Koopmans Model

Ramsey Cass Koopman Model of Economic Growth explained. The difference between Solow Growth model and Ramsey Cass Koopman model is explained here. You can find the same model explained in youtube in urdu/hindi language. Source included here are David Romer 3rd Edition and Notes from Dr. Wasim Shahid Malik (PIDE), verbal discussions with Dr. Miraj ul Haq from Internationa Islamic University Islamabad Pakisan and Raja Abdul Qadir from Kashmir Institute of Economics, Muzaffarabad, Azad Kashmir.

Disclaimer; all errors and omissions are mine, none is related to the persons mentioned above.

Keywords; RCK growth theory, RCK growth model, David Romer RCK model, Macroeconomics growth theories, Overlapping generations model, gross domestic product, convergence.

Right Skewed Histogram

Today we are going to talk about right skewed histogram, friends it is a very important concept for data visualization.

  • Right Skewed

There are two main types of skewness in histograms, right and left. The skewed right histogram is one in which the tail is on the right side. The skewed left histogram is one in which the tail is on the left side. The below histogram is a skewed right.

  • Positive Skewness

A graph which has positive skewness, the mode is usually less than the median and mean.

  • Uniform Histogram

The one which is equally distributed on each end and in the middle is called uniform histogram.


You can see the Bimodal histogram in this black and white graph, it is actually having two modes. If there is one peak, it is uni-modal and if there are two peaks, it is called bimodal. Uni means only one mode and bimodal means two modes. You can see the graph having two peaks, which means it has two modes. Sometimes histogram is bimodal and skewed right. You can see it in the last image on right hand side.

On Great Paul Romer

We all know Paul Romer for his great contribution in the field of growth theories. His magnificent contribution was his paper coming in 1990 on Endogenous Technological Change. He told that it is the new ideas that bring change and causes growth. The model really helps to explain the cross-country income difference in the modern world. Even Samuelson, Solow and Arrow failed to think such thing. His model helped others to think about patents, intellectual property rights, a private incentive to R&D and of course the importance of Universities. He separated ideas into technologies and rules. ttsThe new ideas that bring productivity and growth are not limited to technology but also includes new laws that bring efficiency. Moreover, he explained the importance of spillover in the world of new ideas, especially new laws. The well-performing laws created and tested somewhere else are equally useful in other countries.

His marvellous contribution made everyone to think that he deserves Nobel prize, which sooner or later he will win. But all of the sudden he left the university of Stanford for 5 years and focused on a startup – Aplia. Aplia is an educational device he ran for 7 years and then he sold it. With this device student can create new ideas by applying practical quiz and home assignments, the students of economics can shift the demand curves with it.

Now Romer is doing something new as he always did. He is working on charter cities, a new idea to create a startup, a startup of new ideas. He is talking about creating a new city on an unoccupied land, with new rules adapted from somewhere else. He says in India, 800 million people are still living in Rural area, that will shift to cities in next 20 Years. This is a golden opportunity for us to create a startup of a new city on an unoccupied land. With all new rules that are well tested somewhere else. People from everywhere are voluntarily invited to live in this new charter city with the new set of rules.

Dr. Wasim Shahid Malik | Macroeconomics Notes

Dear Friends,

One of my favourite teacher is Dr. Wasim Shahid Malik, who is mainly related with Quaid-e-Azam University Islamabad.

Dr. Wasim Shahid Malik
Assistant Professor, Quaid e Azam University, Islamabad

Email: wmalik@yahoo.com


His publications may be reached at https://ideas.repec.org/f/pma710.html

You can contact him on RG at https://www.researchgate.net/profile/Wasim_Malik4


I scanned and uploaded all his macroeconomics notes for you; please feel free to download and share.

Macroeconomics teaching of Dr Wasim Shahid Malik is superb, he has no comparison in teaching, particularly the teaching of Macroeconomics. David Romer book on Macroeconomics is relatively tough for Pakistani students, Dr. Wasim Shahid notes are really helpful to understand this book on Growth Theories.


Click the blue text

Download Growth Theories Notes by Dr. Wasim Shahid Malik wasim-shahid-macroeconomics-growth-theories-notes

International Trade and Muslim Brotherhood

Although we say, Muslim brotherhood should rule our foreign policies and economic policies as well, however, the picture shown by data is quite different from what we wish as a Muslim. Turkey, for instance, reduces the volume of its import from Pakistan since 1995, when it was 0.42% of all its imports. In 2015, the share of Turkey’s imports from Pakistan in all its imports is reduced to 0.17%. Some time Economist and Politicians cheat by saying that total volume of imports has grown, but that is not because we preferred Muslim countries over non-Muslim countries, instead it is due to our high consumption caused by increase in Per capita income. On the other hand, imports from India and China arose significantly by Turkey, only in case of India, Turkey’s percentage share of import from India arose from 0.52% to 2.9% during 1995-2015. Now Muslim brotherhood is challenged with economic thought of competitiveness. On one hand, In Islamic Economics, we talk about Muslim brotherhood as the value of Islamic Economy, and on the other side mainstream economics, the rationality of consumer does not allow for compromise on competitiveness, innovation, and durability. Modern economics developed in west talks about positive analysis of the economy, and it shows people are rational. While Islamic Economics talks about how people should behave, which is yet a dream. Because, as I shared statistics, people in Muslims countries prefer high-quality goods and services, they do not compromise on prices. Therefore, they prefer goods produced by non-Muslims countries, as they are more high quality in low price. Muslim consumer neglect Muslim brotherhood, that inspires to buy products produced by Muslim countries. Without concluding this deliberation, I would like to hear your feedback.Capture

10 Tips for Statement of Purpose

Writing a successful statement of purpose is really very essential part of applying for any scholarship or admission. Expert says as it weighs 30% in your evaluation for admission, therefore, at least 30% of the total time behind an application should be given to writing a high-quality statement of purpose (SoP). SoP is everything about you which you could not mention in Resume or other documents.

Following are few tips to a successful SoP

  1. Brainstorm Start from brainstorming about yourself, jot down on a page or note on your iPhone, preferably before you sleep. Do this for 3-4 days, then write all and then squeeze them to one page.
  2. Mention Supervisor Not always, but in some cases, if university allows, you may check faculty for their area of interest and list of publications. In your SoP, you may mention why did you choose a certain supervisor, and you may mention her/his publication name which inspired you the most.
  3. Get SoP checked by this I do not mean you should check your SoP yourself. Get someone else proofread your SoP and improves its sentence structure and grammar. Usually, a SoP enables the university to rate you on how well are you in articulating your thoughts and express yourself.
  4. Be Positive Don’t be negative while writing your SoP, try to be positive.
  5. Excitement and Reason In the starting paragraph show your excitement for the subject and reason to choose this subject.
  6. Evidence In the second paragraph try to convince the evaluator with evidence that you are excited to get admission, you are capable of getting this admission.
  7. The Personal Touch In the last paragraph, try to add few lines about your personal self. This is the most important part of your SoP. After all, SoP is about yourself and future plan not about your past achievements only which are already mentioned in your Resume.
  8. Plain English The most import thing, do not use complex English, it is all about expressing your thoughts for evaluation, do not hinder it with using complex English. Rather use simple and plain English and convey your thoughts clearly.
  9. Done lie Tell them what really are you, don’t tell any lie.
  10. Highlighting a course Highlight a course which this university is offering may attract the evaluator to your admission or scholarship application. If the university is offering a course say ‘Economics of startups’ and by highlighting this course in your SoP will give good points to your application. Because this will be a reason for the evaluator to believe that their university and department worth something in your future plan.