Basic Economics for UPSC/IAS

Economics is one of the core subjects in the UPSC/IAS examination. It is essential to have a good understanding of the basic concepts, principles, and theories of economics to crack the exam. Here are some of the fundamental topics to study for the economy section:

1. Introduction to Economics
- Definition of Economics
- Microeconomics and Macroeconomics
- Positive and Normative Economics

2. Demand and Supply
- Law of Demand
- Law of Supply
- Equilibrium Price and Quantity

3. Production and Cost
- Production Function
- Law of Variable Proportions
- Cost Concepts

4. Market Structures
- Perfect Competition
- Monopoly
- Monopolistic Competition
- Oligopoly

5. National Income and Its Measurement
- Gross Domestic Product
- Gross National Product
- Net National Product
- Per Capita Income

6. Money and Banking
- Functions of Money
- Types of Money
- Central Bank and Its Functions

7. International Trade
- Theory of Comparative Advantage
- Balance of Payments
- Foreign Exchange Markets

Types of Economies

There are three types of economies- Traditional, Command, and Market. Each of these economies has its characteristics and advantages and disadvantages. Knowing the types of economies is essential as they help in understanding how different countries function economically. Here are the details of each.

1. Traditional Economy
- Based on customs, traditions, and beliefs
- People produce what they need
- Limited to small communities
- No room for innovation and growth

2. Command Economy
- The government controls all the economic activities
- No private ownership
- Prices are set by the government
- Limited individual freedom

3. Market Economy
- Decisions are made based on the forces of demand and supply
- Private ownership
- Prices are determined by the market
- Individual freedom and innovation

Conclusion

The basic concepts and principles of economics are crucial for the UPSC/IAS exam. It is essential to have a good understanding of the different types of economies to understand how different countries function economically. Studying economics requires a lot of practice and consistency. Start with the basic concepts and gradually move on to more complex topics.

Basic NCERT Books of Economics( Class 9 to Class 12). Class 12 Economic ( Microeconomics and Macroeconomics) books are mostly mathematical in nature so can take Economics class 12th by V K Ohri

After NCERT books ,Mrunal Videos on YouTube.