A definition that captures much of modern economics is that of Lionel Robbins in a 1932 essay:

“… the science which studies human behaviour as a relationship between ends and scarce means which have alternative uses.”

Scarcity means that available resources are insufficient to satisfy all wants and needs. Absent of scarcity and alternative uses of available resources there is no economic problem. The subject thus defined involves the study of choices as they are affected by incentives and resources.

Economics aims to explain how economies work and how economic agents interact. Economic analysis is applied throughout society, in business, finance and government, but also in crime, education, the family, health, law, politics, religion, social institutions, war, and science. The expanding domain of economics in the social sciences has been described as economic imperialism.

The primary textbook distinction is between microeconomics, which examines the economic behavior of agents (including individuals and firms, consumers and producers), and macroeconomics, addressing issues of unemployment, inflation, economic growth, and monetary and fiscal policy for an entire economy.

 History of economic thought
The city states of Sumer developed a trade and market economy based originally on the commodity money of the Shekel which was a certain weight measure of barley, while the Babylonians and their city state neighbors later developed the earliest system of economics using a metric of various commodities, that was fixed in a legal code.[12] The early law codes from Sumer could be considered the first (written) economic formula, and had many attributes still in use in the current price system today… such as codified amounts of money for business deals (interest rates), fines in money for ‘wrong doing’, inheritance rules, laws concerning how private property is to be taxed or divided, etc. For a summary of the laws, see Babylonian law and Ancient economic thought.

Economic thought dates from earlier Mesopotamian, Greek, Roman, Indian, Chinese, Persian and Arab civilizations. Notable writers include Aristotle, Chanakya (also known as Kautilya), Qin Shi Huang, Thomas Aquinas and Ibn Khaldun through to the 14th century. Joseph Schumpeter initially considered the late scholastics of the 14th to 17th centuries as “coming nearer than any other group to being the ‘founders’ of scientific economics” as to monetary, interest, and value theory within a natural-law perspective.[15] After discovering Ibn Khaldun’s Muqaddimah, however, Schumpeter later viewed Ibn Khaldun as being the closest forerunner of modern economics, as many of his economic theories were not known in Europe until relatively modern times.