Economics: Science or Art?

Economics is a social science in that it focuses on the study of society and the social relationships that individuals have within it. Like other sciences, economics relies on the scientific method of forming a hypothesis and testing situations and developing models in order to support or refute the hypothesis. After studies are conducted, then theories and generalizations can be made. While an important part of the field is deriving theories and principles from information arranged in cause and effect order, these conclusions will not always hold true for every participant in the economy. Generalizations can be made about the tendencies of the typical consumer or firm, but there will always be a few who do not fall perfectly in line with economists' conclusions. This being said, however, economics is still a crucial science and helps explain real-world situations. It can be used to aid: politicians and governments in making policies; consumers in attaining maximum satisfaction of their wants; and businesses to reach full efficiency so no asset is under-utilized. Because economics is such an important field in explaining the way society works to fulfill the wants and needs of people, its achievements deserve to be recognized through the Nobel Prize foundation.

Home Ownership for All?

In America, the government has put great emphasis on owning a home being a crucial aspect in achieving the American dream and contributing to society. Government has encouraged ownership through tax deductions on mortgage payments. Companies sponsored by the government also provide cheap financing for those looking to buy a house but don't offer this opportunity to people renting. There are various advantages to owning a house not just for the homeowners, but also society itself. Home-owning encourages people to save more money in order to pay off the mortgage, and this saving in general enables them to accumulate wealth. The economy also tends to do better when housing prices are up because people feel as though they have more money and are willing to buy more goods and services. Social benefits also arise from house ownership. Those who own homes tend to be more involved in their community, have more stable lives, and their children perform better in school.
Despite the many advantages of owning a home, it is accompanied by drawbacks as well. The risk of negative equity can be detrimental and may result in a person losing their entire savings and having their credit destroyed. This is because homes are bought on margin and consume mass amounts of money. Once you own a house, it is quite difficult to make money off of it since housing is not a liquid asset. The entire house must be sold, not just a room or two, making it hard to make a profit. But in the end, it would seem as though the benefits outweigh the disadvantages of owning a home. This is not to say, however, that renting is necessarily bad. Renting can be very helpful and practical for young adults who are just starting out. It enables them to move from place to place more easily without being tied down to one area. Later on in life, home ownership becomes more practical when a family and permanent job come into the picture because it provides a sense of stability and security.