The Essence of Economics: A New Definition and Its True Purpose

Introduction: Redefining the Foundation

The field of economics is in a state of profound disarray—largely due to the absence of a sound, principled definition. The prevailing definitions, though widely accepted, are fundamentally flawed. They focus narrowly on material processes like production, distribution, and consumption, failing to capture the true nature and higher purpose of economics as the principal social science.

Definitions matter. They shape how people understand and engage with concepts, institutions, and systems. A definition is more than a description—it sets the direction, scope, and goals of a discipline. When poorly defined, a field like economics can veer off course, producing models and policies that are not only incoherent but potentially destructive.

This article contends that the commonly accepted definitions of economics are superficial, mechanistic, and ultimately misleading. As a result, economic models built on these foundations have typically led to coercive, confiscatory, and repressive policies—particularly under contemporary statist and technocratic socioeconomic systems.

A new definition is therefore imperatively needed: one that aligns economics with its true essence and most beneficial purpose.

A New and Constructive Definition of Economics:

Economics is a social science whose fundamental purpose is to study and understand socioeconomic phenomena to foster justice, prosperity, and peaceful human relations within and among societies.

This definition anchors economics not merely in material concerns but in human dignity, natural rights, and an ethical, timeless foundation. It reorients the field away from sterile utilitarianism and positivism toward a humane, justice-centered science. By placing ethical principles and social well-being at its core, this definition offers a more truthful and constructive foundation for economic inquiry and policy.

1. Why Existing Definitions Are Flawed

The standard definitions of economics, while not wholly incorrect, are fundamentally flawed and misleading. They fail to capture the essence of economics as a human science—one concerned with justice, prosperity, and peaceful human relations. Instead, they reduce the field to materialistic and mechanical processes, such as resource allocation, market behavior, and statistical analysis detached from human nature and reality.

One of the most widely circulated definitions, found on Investopedia, states:

Economics is a social science that focuses on the production, distribution, and consumption of goods and services. The study of economics is primarily concerned with analyzing the choices that individuals, businesses, governments, and nations make to allocate limited resources.

Another familiar version defines economics as “the study of scarce resources with alternative uses.” Even in more free-market circles, the definition often reads:

Economics is the study of how societies allocate limited resources to satisfy unlimited wants and needs. It examines production, distribution, and consumption, as well as factors like supply, demand, prices, and incentives.

While such definitions are descriptive, they are ultimately inadequate and detrimental. They fail to reflect the ethical dimensions of human nature and actions, the significance of natural rights, and the moral consequences of economic choices. They imply that economics is simply about efficiency or utility optimization—ignoring the fundamental social and philosophical questions that economic systems inevitably raise.

Perhaps the most influential academic definition comes from British economist Lionel Robbins, who wrote in An Essay on the Nature and Significance of Economic Science (1932): “Economics is the science that studies human behavior as a relationship between ends and scarce resources, which have alternative uses.”

This definition, though historically important, cemented a mechanistic and utilitarian view of economics that has dominated ever since. It abstracts from the ethical context of human choices and actions and fails to offer a productive standard for evaluating policies or theories. Thus, it contributes to the confusion and distortion that plague modern economics.

These flaws are not necessarily the result of bad intentions. Robbins and other early economists sought precision and scientific rigor. But the effect of these narrow definitions has been to strip economics of its ethical grounding and to legitimize models and policies that enable coercion, fraud, repression, and injustice.

As I first discussed in Africonomics: A School of African Philosophical and Economic Thought:

Western economics is in disarray, marked by much confusion and distortion. The fundamental issue with Western economics and other social sciences is that they rest on a mechanistic worldview and are dominated by utilitarian and positivist frameworks. This lack of ethical grounding has led to confusion and distortion, resulting in garbled economic models with coercive, fraudulent, confiscatory, and repressive policy implications.

In essence, the lack of a definition that articulates the true purpose of economics has left the field adrift and disoriented, dominated by seemingly scientific yet flawed and harmful models. Existing utilitarian definitions downplay or ignore the moral obligations and social responsibilities inherent in human choices, actions, and institutions. Hence, economists repeatedly construct models that normalize unethical practices—especially in statist socioeconomic systems where coercion, fraudulence, and repression are built into policy design.

A more appropriate and constructive definition must recognize that economics is not about things but about people—their choices, interactions, and the moral implications of their actions.

2. Definition and Purpose of Economics

The continued reliance on flawed definitions has contributed to the rise of misguided economic models—models that appear scientifically rigorous but are, in reality, politicized, ethically bankrupt, and typically ruinous in practice. These definitions have enabled technocratic and statist approaches that treat people as data points or mechanical parts rather than as moral agents with inherent rights and responsibilities.

By contrast, a proper definition of economics must reflect its true nature as a social science rooted in human volition, ethical discernment, and relational dynamics. It must guide economic inquiry toward outcomes that promote human peace and flourishing rather than state control, oppression, or exploitation.

The correct definition of economics is as follows:

Economics is a social science whose fundamental purpose is to study and understand socioeconomic phenomena to foster justice, prosperity, and peaceful human relations within and among societies.

This definition reorients economics toward its rightful goals and more beneficial function. It incorporates the essential elements of ethical evaluation, human dignity, and peaceful cooperation. It also retains the practical core of economic analysis: Economics analyzes human choices, actions, and relations in the context of indirect exchange societies enabled by money—specifically how economic actors allocate limited resources with alternative uses to satisfy needs and wants.

This analytical focus is secondary, not primary. The essence of economics is not merely about resource allocation, but about understanding how human societies can justly and peacefully thrive.

Such a redefinition requires economists and other social science scholars to ground their work in natural-moral law ethics—principles that prohibit deception, fraud, coercion, confiscation, or repression. These ethical guardrails are essential for evaluating whether a theory or policy is sound and coherent, serves human flourishing, or facilitates oppressive practices and injustice.

In my paper Fractional Reserve Banking Is Fraudulent and Ruinous, I underscore the centrality of ethics to the social sciences:

Unlike other creatures, humankind has innate morality and ethical discernment capacity. This allows humans to distinguish right from wrong, ethical from unethical, and good from evil… Therefore, theories that lack ethical grounding and whose policy implications result in fraudulent, confiscatory, and oppressive practices can be considered primitive, animalistic, and uncivilized.

Economics that justifies or tolerates such practices is not science—it is pseudoscience cloaked in technical jargon. No legitimate social science should provide intellectual cover for coercion, fraud, or systemic injustice.

Economics and other social sciences must be guided by moral philosophy as sciences of human decision-making, action, and interaction. They must reflect the reality that people are not experimental objects to be managed, manipulated, or sacrificed for abstract goals. They are moral agents with rights and obligations—participants in society whose dignity and natural rights should be respected.

This is why the redefinition of economics is not merely a semantic exercise. It is a paradigm shift—a call to restore ethical foundations to the field and reorient it toward its true purpose: advancing justice, prosperity, and peace.

3. Muddled Economics, Ruinous Policies

The misleading definitions that dominate modern economics reflect a Western intellectual tradition rooted in utilitarianism and positivism. This tradition treats human beings as material inputs in mechanistic systems and promotes models that lack ethical grounding. As a result, contemporary economics has become detached from the realities of justice, rights, and moral responsibility.

The prevailing view—called “value-free” economics—has normalized coercive, fraudulent, confiscatory, and repressive policies under the guise of scientific objectivity. This has contributed to the rise of centralized technocratic governance, widespread corruption, political dysfunction, economic instability, and conflict across the globe.

Economics has earned the label “the dismal science.” It may presently be a dismal science, not because of its subject matter but because of its lack of ethical foundations. Without moral standards as guardrails, economic theories have justified arbitrary state control, fiat monetary fraud, systemic injustice, and even outright oppression.

This technocratic, statist approach is now producing disastrous outcomes. Mainstream economic models, once thought to be rigorous and scientific, appear increasingly muddled, arbitrary, and destructive. These models serve political power rather than truth, justice, and civilizational advancement, enabling a racialized and militarist global order built on state coercion, centralization, confiscation, exploitation, repression, and aggression.

The result is a world drifting toward autocracy. As the V-Dem Institute’s 2023 Democracy Report reveals, by 2022, 72 percent of the world’s population—5.7 billion people—lived under autocratic regimes. This is not an unfortunate coincidence; it is the direct consequence of systems founded on flawed economic thought—systems that elevate state power and systematically suppress individual rights.

As I first explained in The Scale of Statism: A Framework for Ranking Socioeconomic Systems:

One of our time’s most significant and detrimental fallacies is the misconception that existing economies are capitalist… In reality, Western countries and the current global order, built by imperial states, are statist systems that lean closer to socialism than to free-market capitalism.

This misperception has permeated academia, where statist models dominate. Economists are often rewarded for producing theories that support state intervention, while those who challenge the orthodoxy are marginalized. The profession has become deeply politicized and embedded in the machinery of the state itself.

In this context, it’s no surprise that economics has lost its way. It has become a field obsessed with numbers, models, and empirical data—at the expense of meaning, truth, ethics, and justice. It treats societies as engineering problems, ignoring the moral and social dimensions of human life.

Economics is not about controlling and centrally managing economies—it is about understanding human choices and actions and promoting peaceful relations. It is not about designing systems of power and repressive control—it is about evaluating how individuals and societies can thrive in justice and liberty.

To restore meaning to economics, the field must reject its utilitarian-positivist underpinnings and embrace the natural-moral law framework of Africonomics. It must return to its rightful purpose: fostering justice, prosperity, and peace in a world of thinking, choosing, and morally responsible human beings.

4. The Beneficial Role of Economists

If economics is to be redefined as a science that fosters justice, prosperity, and peaceful human relations, then economists must likewise be reoriented toward that purpose. Their role is not merely technical or analytical but moral and philosophical. Economists must recognize their responsibility to truth, ethics, and society.

This need for moral clarity has long been felt—even if only intuitively—by prominent thinkers. In his book What Should Economists Do?, Nobel Prize-winning economist James Buchanan posed a strikingly fundamental question: What is the proper role of economists?

The persistence of such a question at the highest levels of the profession reflects the disorientation that results from flawed definitions of economics. Without a clear understanding of what economics is, economists struggle to define their purpose.

The true nature and overriding purpose of economic science go beyond studying the production, distribution, and consumption of goods and services… Economics must prioritize studying and understanding socioeconomic phenomena to foster justice, prosperity, and peaceful relations within and among human societies.

This redefinition answers Buchanan’s question. Economists should be guided by truth, committed to justice, and oriented toward peaceful human cooperation. Their role is not to facilitate political control, technocratic social management, or centralized economic engineering. It is to seek, establish, and communicate economic truth—so that individuals and societies can flourish freely, justly, and peacefully.

Unfortunately, mainstream economics has failed in this task. It has served as an intellectual tool of the state, justifying coercive, confiscatory, and repressive policies under the guise of expertise and scientific objectivity. It has prioritized centralized models, abstract data, and predictive control over people's dignity and rights.

This failure has contributed to widespread crises—economic, political, moral, and even demographic. A science that claims to study human activities but ignores human ethics cannot offer real solutions. It can only deepen confusion and fuel the repressive machinery of state control.

Human society should not be treated as a laboratory where citizens become unwitting test subjects for positivist and technocratic experimentation. Economics that justifies coercive, repressive, fraudulent, or confiscatory policies fails the fundamental test of justice and cannot legitimately claim scientific status. Despite their technical veneer, such approaches are fundamentally pseudoscientific - they contradict the ethical foundations that genuine science requires.

No credible philosopher of science would argue that economics or any social science exists to rationalize models whose implementation requires state coercion and aggression. The true purpose of economic science must include respect for human dignity, agency, and voluntary cooperation rather than systems that involve threat, compulsion, and aggression to maintain. When economic theory necessitates force for its implementation, this reveals not scientific validity but fundamental conceptual failure.​​​​​​​​​​​​​​​​

The economics profession must be reformed. It must abandon its fixation on state-centered models and rediscover its human purpose and ethical compass. Economists should no longer serve as functionaries of political power but as defenders of truth, justice, and liberty.

In this spirit, Africonomics offers a transformative alternative. Grounded in natural-moral law ethics and an understanding of human beings as moral agents, Africonomics affirms that economics must be rooted in truth and justice, not power and control. It emphasizes our shared humanity and the universal moral order that transcends culture, creed, or empire.

The beneficial role of economists is to pursue and establish economic truths to advance a just, prosperous, and peaceful world. In other words, economists can play a crucial role in fostering a genuinely civilized world. This is the fundamental purpose of economics—and the standard by which economists must now be evaluated.

Conclusion: Restoring Meaning to Economics

The prevailing definitions of economics have failed. By reducing the field to study material flows and resource allocation, they have stripped it of its ethical core and social purpose. These flawed and superficial definitions have contributed to economic confusion, distorted models, and policies that enable coercion, fraud, and systemic injustice.

Economics is not merely a tool for managing scarcity or optimizing output. It is the principal social science—a field that deals with human beings, their choices, actions, and relations. Therefore, it must be grounded in truth, ethics, and a commitment to human flourishing.

This article has proposed a new and more constructive definition of economics—one that reflects its true nature and aligns with its rightful purpose:

Economics is a social science whose fundamental purpose is to study and understand socioeconomic phenomena to foster justice, prosperity, and peaceful human relations within and among societies.

This redefinition is not simply academic—it is foundational. It redirects economic thought toward moral clarity, structural justice, and civilizational progress. It challenges economists and policymakers to abandon mechanistic, state-centric frameworks and adopt an approach that honors the natural rights, dignity, and agency of individuals.

The need for such a reorientation could not be more urgent amid rising authoritarianism, worsening inequality, and global unrest. The state-centered, technocratic models that dominate the current global order have proven to be not only destabilizing and destructive but also profoundly unethical and uncivilized. Economics must reclaim its essence to move toward a freer, more prosperous, and more peaceful world. That begins with redefining what economics is—and what it is for.