Society’s Objectives and the Allocation of Resources

Abstract

This chapter describes the analytical framework which is used in each of the subsequent chapters for the study of particular social problems. Those readers who have studied economics previously will recognise certain parts of the analysis (such as the theory of demand and supply), but are unlikely to have seen it incorporated within the general framework presented here. This is because we have endeavoured to explain at an introductory level the relationship between social objectives and methods of resource allocation, notably the market system. Explaining this relationship involves dealing with a number of theoretically complex issues and it is for this reason that most economics textbooks delay dealing with it until the intermediate or advanced level. However, the study of social problems is greatly assisted if some appreciation of the subject is acquired at the outset. Moreover we feel that it is possible to retain an acceptable degree of theoretical precision and at the same time convey certain key elements of the subject to a more general readership.