Difference between Business Administration and Economics

Business administration is "a field of social science, a 'science' that is being discussed in order to elucidate the 'universal laws' of how the act of management, and the individuals and organizations that perform it, transition, exist, and operate, which can have a profound impact on society, the economy, and the human mind. (Kotosaka, 2018)"

Economics is "the study of how society manages its scarce resources. (omitted) Economists study how people make decisions. They study how much they work, what they buy, how much they save, and how they invest their savings. Economists also study how people decide with each other the selling price of goods and the quantity of goods sold. (Mankiw, 2017)"

As mentioned above, since economics is concerned with all economic phenomena in human society, its analysis includes management, which is the subject of interest of business administration. (Incidentally, my field of specialization is industrial organization theory, one of the applied fields of economics, where the main object of analysis is the enterprise.)　) Economics is strongly interested in how companies make decisions and how those decisions affect the economy as a whole. And it follows from the above definition that the same is true of business administration. Focusing on the major topics that make up business, such as marketing, accounting, finance, and management strategy, for example, business administration still tries to explain the mechanisms of corporate behavior and decision-making.

Economics then analyzes all research subjects using the economics-specific way of looking at things. In the following, based on Ito (2012), we will explain its most important feature: thinking about rational human beings. In economics, "we assume that there is some 'intention' behind human behavior. In other words, we think of individuals who have clear objectives and try to make choices that will achieve those objectives as best they can. Such choices are called 'rational' decisions. （Economics sees humans as trying to be as rational as possible under various constraints. This way of looking at things is different not only from business administration but also from other social sciences, and is a way of looking at things and tackling problems (approach) unique to economics.

Many of those who choose the Faculty of Business Administration undoubtedly have a strong interest in "management. Studying economics in the Faculty of Business Administration is one more way to approach the subject. The results of analyzing "management" using the economics perspective may differ from or overlap with the results using the business administration perspective, and if you can use multiple perspectives on a subject, you will be able to analyze it in a more multilayered way. I believe that this is the meaning of studying economics in the Faculty of Business Administration: to gain one more way to better understand the people you are interested in.

References

• Hidefumi Ito (2012) "Hitotsura yomu ekonomikusu" Yuhikaku
• Masahiro Kotosaka (2018) "Management Strategy Original Theory" Toyo Keizai Inc.
• Gregory Mankiw (2013) "Mankiw Economics I, Microeconomics (3rd Edition)" (translated by Adachi, Ishikawa, Ogawa, Jishu, Nakama, Yanagawa) Toyo Keizai Shinposha