KSLU Solved Question Papers
Principles of Economics
Previous Year Question Paper with Solution
B.A. LL.B. (Five Years) · Sem 1
2018 Jun Examination
munotes.in
Mumbai
B.A. LL.B. (Five Years) Sem 1 Principles of Economics 2018 Jun Question Paper with Solutions
First published on munotes.in on 21 October 2026.
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Contents
The questions below are the paper as Karnataka State Law University set it at the 2018 Jun examination, in the order it was set.
MarksPage
The Paper as Set
The questions in this volume are the questions asked at the 2018 Jun examination, reproduced as Karnataka State Law University set them, in the order it set them. Long reading passages are shortened to their first and last lines and our summary; the original paper prints them in full. Only the answers are ours. See the original question paper.
Duration 3 hours · Total marks 100 · 13 questions answered
How to use this volume
Solve the paper first, under exam conditions and against the clock. Then read the answers here and mark your own. Reading a solution before attempting the question feels productive and teaches very little, because recognising an answer is not the same as being able to write one.
Q1Critically examine Marshall's definition of Economics.[16]
Answer
For full marks, cover: why the wealth definition was replaced; Marshall's definition in his words (eighth edition, 1920; first published 1890); the support of Pigou and Cannan; the features of the definition, each explained; its merits; a full critical examination, led by Lionel Robbins (1932), with his own words; an illustration; what survives of the definition; and a balanced conclusion.
1. Why a new definition was needed
The classical economists treated economics as the science of wealth. Adam Smith wrote in 1776 that political economy "proposes to enrich both the people and the sovereign". J.S. Mill said that writers on political economy "profess to teach, or to investigate, the nature of Wealth".
This view put wealth at the centre and man in second place. Critics attacked it bitterly. Thomas Carlyle called economics "the dismal science" in 1849. John Ruskin replied, in Unto This Last (1860): "THERE IS NO WEALTH BUT LIFE." Economics seemed to teach selfishness and the love of money.
Alfred Marshall rescued the subject by moving the emphasis from wealth to human welfare.
2. Marshall's definition
In Principles of Economics (eighth edition, 1920; first published 1890), Marshall wrote:
"Political Economy or Economics is a study of mankind in the ordinary business of life; it examines that part of individual and social action which is most closely connected with the attainment and with the use of the material requisites of wellbeing." He went on: "Thus it is on the one side a study of wealth; and on the other, and more important side, a part of the study of man."
3. Support from Pigou and Cannan
A.C. Pigou, Marshall's successor at Cambridge, narrowed welfare to what money can measure. In The Economics of Welfare (1920) he wrote that the range of inquiry is restricted to "that part of social welfare that can be brought directly or indirectly into relation with the measuring-rod of money". This part he called economic welfare.
Edwin Cannan held that "The aim of Political Economy is the explanation of the general causes on which the material welfare of human beings depends".
4. Features of the welfare definition
1. Man comes first. Economics is "a study of mankind". Wealth is studied only as a means to human wellbeing.
2. The ordinary business of life. Economics studies how people earn and spend their income in daily life, not unusual or heroic conduct.
3. A social science. It studies people living in society. It does not study an isolated person or one who lives apart, such as a hermit.
4. Material welfare only. It deals with the "material requisites of wellbeing": food, clothing, shelter and other material goods.
5. Individual and social action. It covers both a person's own efforts and the actions of groups and the State.
6. Measurable by money. Marshall and Pigou kept economics to those activities whose motives can be measured by money.
5. Merits
- It gave economics a human face and answered Carlyle and Ruskin.
- It made wealth a means, not an end.
- It linked economics to welfare policy, such as taxation, social security and the relief of poverty.
- It made economics a social science concerned with people in society.
- It is practical. It deals with everyday activities that anyone can observe, such as earning wages and buying food. This makes the subject easy to grasp.
6. Critical examination
The sharpest criticism came from Lionel Robbins in An Essay on the Nature and Significance of Economic Science (1932). Other economists added further objections.
1. Material and non-material cannot be separated. Robbins took the example of wages. The wages of a sewage collector are paid for work "conducive to material welfare". But the wages of the members of an orchestra are paid for work that "has not the remotest bearing on material welfare". Yet both are fixed by the same theory of wages. Robbins concluded that economics cannot be confined to material welfare. Services of teachers, doctors, lawyers and artists are economic though they are not material.
2. Welfare is vague and cannot be measured. Welfare is a state of mind. It differs from person to person and changes over time. A science cannot rest on a concept that cannot be measured.
3. Many economic activities do not promote welfare. Liquor, tobacco and gambling are produced, bought and sold for a price. They are clearly economic activities. Yet they harm welfare. A definition based on welfare cannot explain why economics studies them.
4. Economics should be neutral. Robbins argued that economics is a positive science. It explains what is, and should not pass judgments on what is good or bad. Bringing welfare in makes economics a normative study.
5. It is classificatory, not analytical. Robbins called the welfare idea a "classificatory" conception. It picks out some kinds of conduct as economic and leaves out others. His own definition was "analytical". It looks at one aspect of all conduct: choice under scarcity.
6. It is too narrow. It confines economics to social man. So it leaves out the problems of an isolated person, who must also choose how to use scarce time and resources.
7. It ignores scarcity. The real cause of the economic problem is that means are scarce and have alternative uses. Marshall's definition does not make this central.
7. Robbins's alternative in brief
Having rejected the welfare definition, Robbins offered his own: "Economics is the science which studies human behaviour as a relationship between ends and scarce means which have alternative uses."
It rests on four facts. Wants are many. The means to satisfy them are limited. The means can be put to different uses. And wants differ in urgency, so they can be ranked. Where these four facts are present, a choice must be made, and that choice is the subject of economics. On this view the orchestra and the sewage collector both belong to economics, because both sell scarce services that have other possible uses.
8. An illustration
Consider three workers in the same town. A mason builds a house; a singer performs at a wedding; a worker in a liquor factory bottles alcohol. Under the welfare definition, only the mason's work fits neatly, since it produces a material requisite of wellbeing. The singer's service is non-material, and the liquor worker's product harms welfare. Yet all three are paid wages, all three sell a service in a market, and the same theory explains their earnings. This is Robbins's point in practical form.
9. What survives of the welfare definition
The criticism did not destroy Marshall's contribution.
- Welfare economics grew from the work of Marshall and Pigou. Governments still judge policies by their effect on welfare.
- Most economists accept that economics is not only a positive science. It must also guide policy.
- Later definitions, such as Samuelson's growth definition, combine Robbins's idea of scarcity with a concern for distribution and wellbeing.
- In India, the Directive Principles in Part IV of the Constitution reflect the welfare aims that Marshall stressed.
10. Welfare and scarcity definitions compared
| Point | Welfare definition | Scarcity definition |
|---|---|---|
| Author | Marshall, supported by Pigou and Cannan | Robbins, 1932 |
| Central idea | Material welfare | Choice under scarcity |
| Nature | Classificatory | Analytical |
| Point | Welfare definition | Scarcity definition |
|---|---|---|
| Scope | Social man, material goods | All human conduct facing scarcity |
| Ends | Judged by their effect on welfare | Taken as given; neutral |
Conclusion. Marshall's welfare definition placed man above wealth. It made economics the study of mankind in the ordinary business of life, concerned with the material requisites of wellbeing. Pigou and Cannan supported it. Robbins showed its weaknesses: material and non-material welfare cannot be separated, welfare cannot be measured, and some economic goods harm welfare. He also called it classificatory rather than analytical. Yet its human outlook survives in welfare economics and public policy, and later definitions blend it with Robbins's idea of scarcity.
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