Economy and economic education
On this and the linked pages can be informed only very roughly about 'economy'. The focus is on an explanation of the terms (especially categories and thought schemes) used in the game analyses. For a more detailed description, please refer to the book 'Ökonomische Bildung', which is also available as a free e-book (from October 2019). In addition to scientific information (e.g. history of economic thought, categories), the book contains information that is important for the design of business education and thus for business teachers.
'Economy' deals with the production and distribution of resources, whereby dealing with scarcity is characterized by (limited) rationality, efficiency and maximization of benefit. Central questions and objects of analysis are rational decisions under conditions of scarcity as well as the design of cooperations for the realization of profits from cooperations.
Starting from the simplifying assumption that human needs tend to be infinite, but that the goods which are available to satisfy them are only limited in quantity, a scarcity problem arises. At least from an economic perspective, this suggests rational behaviour or decisions in such a way that - against the background of given incentives, restrictions and uncertainty - the expected benefit for the decision-maker is maximised and the resources are used as efficiently as possible. Due to synergy effects and specialisation advantages, cooperation and division of labour between several actors is particularly recommended. This can lead to social conflicts and inequality. In addition, the question of which goods are to be produced and how they are to be distributed must be clarified.
These questions and problems, which can arise both from systemic structures and from individual decisions (e.g. in dilemma situations and external effects), can be clarified by means of suitable institutions. Important institutions are markets that can be designed according to different rules, for example with competition and free price formation. Other institutions include laws, ordinances and systems for material redistribution. In this respect, the economic order of a country can also be understood as a specific arrangement of institutions.
In order to understand the complex functionality of national economies, it is helpful to imagine that many facts are interdependent or networked and that circulation of goods, information and money takes place. Furthermore, in most aspects it is necessary to manage conflicts of objectives and to recognize economic phenomena and processes as dynamic and changeable, which is why systemic thinking is so important.
An in-depth description of the categories and thought patterns addressed can be found on the pages linked below.
Selected Categories and Thinking Schemes
- Division of labour
- Need and benefit incl. scarcity
- Efficiency, cost-benefit ratio and economic principle
- Decision, risk and conflict of goals
- External Effects
- Justice, inequality
- Coordination and economic order
- Opportunity costs
- Systemic thinking incl. dynamics
- Transaction costs
- Networking and interdependence
While categorical approaches to economic education (see categories above) are based on academic systematics, life situation-oriented concepts of economic education bundle certain competences that are needed to cope with economically difficult life situations. In particular, the following situation groups are counted:
- Consumers, e.g. for decisions in the areas of consumption, investment, credit demand or insurance.
- Employed person incl. choice of profession ( career orientation) and start-up/management ( Entrepreneurship Education)
- Citizens, e.g. to form judgements on economic policy measures
Areas of competence
With reference to the educational standards of the Gemeinschaftsausschuss der deutschen gewerblichen Wirtschaft (p. 19 ff.), the numerous individual competences are assigned to the following competence areas in the game analyses:
Decision and rationality: The ability to make a rational choice among alternative options for action in economically shaped life situations and to consider the restrictions by taking action in this decision. This includes the following skills: In the specific economic (decision-making) situation they [the pupils] can identify the given possibilities for action, identify and observe the set limits for action, anticipate the expected consequences of action and evaluate them with reference to their preferences and select the best alternative. In the long term, they can expand their options for action. They are willing and able to use these abilities for themselves and representatively for other people.
Relationship and interaction: Students should describe and evaluate economic structures with regard to diverging and converging constellations of interests. They can recognise and assess the importance of cooperative and conflictual relationships in the economic process. This includes the following skills: In concrete and typified social contexts, students can analyse the divergence or convergence of interests and also analyse and shape the forms of cooperative interaction. They can analyse institutions as the consolidation of behavioural expectations and reconstruct their emergence.
Order and system: Pupils should recognise economic interrelations as systemic effects. They evaluate state action in a market economy and its consequences for individuals, different groups and society on the basis of economic knowledge and with a view to networked effects and they explain the basic principles of the social market economy (e.g. freedom, social balance). This includes the following skills: They can analyse aspects of the market system. They can assess and evaluate the market system, in particular the social market economy, with regard to various criteria and guiding ideas. They can analyse the role of the state in market processes and analyse and shape individual policy options.