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What The Economy Has To Do With “You”

4 September, 2021 |
Lifestyle

As an individual you might be wondering what the economy has to do with you. Most people think the economy has absolutely nothing that directly impacts it. Wrong! You  may not see, feel, or make any tangible relation with the economy. Ans when it pops up on the news, it is mostly boring and so complicated for you to even mind what is being said.

What you don’t know is that the economy is a cumulative effect of all the individual actions made within it. It is how you live your life and how your neighbor lives theirs. It is what values you have, what you consider is right or wrong, your choices with regard to income and expenditure, and so many other things you do.

All your actions have a ripple effect on the economy in so many unimaginable ways. For instance, consider your decision to take dinner at home instead of a restaurant. You will save money and use it for fare the following day but at the same time, you have reduced the daily profits of the restaurant you would have eaten at.

When trying to understand the economy, sometimes it is better to start with the economic choices we make on an hourly basis.

There is so much interconnection that your single choice will affect the people close to you, and in an equal measure those very far way. You’re reading this blog because of the Internet. Who provides your connectivity? How much do they charge? What did you take for lunch yesterday? Which farmer grew it and how did they do it? Was he provided with government subsidized fertilizers?

So much interrelation between economic agents to even think of ignoring your role  in it. You may be aware of the consequences of other people’s actions, or you may never understand it. It could be further away from us, such as the decision by some politicians to invest a lot of money in promoting BBI, the introduction of a new tax and the subsequent increase in prices, and the release of pollutants miles away from your home. It could also be close to you, such as a decision to buy peanut butter  ‘randomly’ instead of Blue Band without realizing there was a strategic billboard advertising Blue Band as you were walking from home to the groceries.

The economy has a lot to do with you. How do we decide how to get along in the economy? Should we work together or compete? Individuals differ on the best way to interact in the economy due to different values. We are in a capitalist economy where you have to fight for your individual needs. If you can’t afford to buy a shamba that is it, you will never own one. But the economy also has some socialism tendencies, such as providing free medical services to vulnerable communities.

It goes without saying that we should start by understanding ourselves better to make attempts at understanding economics. What motivates you is different from what motivates me. How a person behaves alone is different when he is part of a crowd. Just look at how doctors and teachers behave when on strike. If a single doctor went on strike and does what they do as a group, he would be considered mad.

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