The purpose of economics is to allocate scarce resources in a manner that maximizes society's happiness and to their highest valued use. Do you agree?
1) How do we measure society's happiness ?
2) How is the highest valued use determined ?
What are the issues and difficulties you see around trying to achieve these goals ?
Please elaborate on all questions
I would agree. Remember that there are three primary actors in the economy; firms (who maximize profits), consumers (who maximize utility), and governments (who maximize social wellbeing). Economics is a tool used by governments and policy makers to maximize social wellbeing. Sometimes governments intervene because market systems fail. Markets fail for the following reasons; (1) public goods, (2) externalities, (3) market power, and (4) inequities). That said ...
Three primary actors in the economy are examined.