The modern concept of the economy is a construction of the conceptualization and mapping of the understanding that existed in the nineteenth century and twentieth century. The concept of economics, as it exists, has an input from various aspects of society. State policies, as well as individual actions, contributed towards economic development and the manner in which it is perceived. Politicians projected powers and as such created policies that defined the economy while the people despite not having any political power, they engaged in activities meant to improve their living standards and as such contributed towards the development and shaping of the economy. Therefore, to develop a well-grounded and realistic understanding of economics, it is essential to understand the society.
The Society
Historical developments clearly indicate that the economy of humankind is rooted in the social relationships that exist during the time of the society’s existence. All steps which were taken by the society in the process of social interactions eventually defined the economy of man. As such, economic systems end up running on non-economic motives. For example in India, there were engagements where items were exchanged in the form of gifts. As such, a gift economy was created where jewelry and other artifacts changed hands, driven by acts of generosity. The measure of economic achievement in the gift economy was mainly geared towards determining who had given the most gifts to the other person. The leaders who lived at the time of these gift economies, engaged in vicious competition on the basis of who had issued the most gift, as well as the most valuable gifts. The gifts went beyond mere artifacts to sewing machines, expensive blankets, and other expensive items that at times led to wealth destruction and sinking of previously wealthy individuals.
It is clearly evident that societies need to have an economy for them to continue their existence. The history of the human economy indicates that the economy is not always driven by the closely related economic factors. To understand, the economy it is, therefore, paramount that one develops an understanding of the society and its practices.
Colonial Relation
The origin of modern economics can be traced to the colonial times. For example in India, before the colonial era, national planning was inexistent5. The existing roles that are played by scholars and different institutions did not exist until the years when the British Empire colonized India. The present discourse on India’s economy can be traced back to the colonial era. During the colonial period, the impact of state policy was used to define what the country would achieve economically. Experts in economic theory measured economic aspects by relying on data whose foundation was based on state policies. The scholars and other economic theorists presented economic arguments in a manner that indicated their political affiliation. Political opposition, on the other hand, attributed economic failure to the existing policy measures. As such, economics in the colonial era was mainly rationalized using policy data.
Market Economy
The concept of the market economy has also been in existence in India. The phrase market economy describes an economy whose key determining factors are the market prices. Unlike in a situation where the economic perspectives are based on political actions and policies, in the market economy the system organizes its economic life without any interference from any external forces. The market economy is the dominant type of economy in India today. The actual drive for India to adopt a market economy was stimulated by the changes in the international order when the rest of the world moved towards the market economy in the 90’s.
Environmental Relation
The economy is also tied to environmental aspects which contribute towards the conceptualization of the economy. The environmental economy is driven mainly by the indigenous population in India. The indigenous people are in a constant struggle to preserve their livelihood by preventing excessive environmental degrading activities as established by most modern companies. As such the underlying driver in environmental economics is environmental justice. The capitalist economy that exists today has led to increased resource extraction through activities such as mining, biomass extraction, as well as the creation of mega hydroelectric dams. As such, compared to the past decades, the world is currently experiencing more conflicts that are related to these environmental activities. As such, the phenomenon regarded as the environmentalism of the poor people has emerged. Given the contribution of the environment, to the economy, the actions geared towards protecting the environment define the conceptualization of the economy.
The clash can be traced to the growth of the population as well as the social metabolism associated with the industrial economy. Most resources that are used by the industries such as energy to drive operations are non-recyclable and hence they are one-use. As such the industries have to keep relying on the source which is mainly the environment to ensure that their supplies are replenished. Even recyclable materials such as iron can only be recycled once and hence continued dependency on the environment.
The Economy and Theories of Development
The understanding of the production and conceptualization of the economy has a significant input on the view of theories which, had been discussed previously such as modernization and colonialism. Colonialism can be summed up as the action of certain people dominating other people. On the other hand, modernization sums up the progressive transitional process of individual societies from a traditional society to a modern society.
As seen in the reading on economic development, modernization of the society is driven by several factors. To qualify as a modern society, there are number of practices that a society has to shed as it goes along. It is clearly evident that the society does not transform overnight. Furthermore, societal transformation is most of the times driven by intra-societal factors. For example, the existence of a gift economy was driven by the need that existed in the Indian society that practiced the gift economy. The review of the development of the economy is a clear indicator that by itself, the economy has the power to transform the society from a traditional society to a modern society which relies on modern economic methods.
The study of the economy enhances the understanding of colonialism and its practices. It is evident from the changes that colonialism introduced in the human economy of its subject, that colonialism is about political and economic control. The colonial power exercised financial oversight in their territories so as to gain control of the system which guaranteed improved strategic positioning. Pre-colonial India was mainly a feudal society and practiced the feudalism form of economy where the land was communally owned. It is clear that to dominate their territories, colonial powers eliminated the beliefs as they were held by the indigenous people. An understanding of the economy clearly paints a picture of the power of the economy. It is clear that without exerting their dominance on the economy, the colonial powers would not have gained the control that they had established.
Bibliography
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