Economic Activities

Any human activity that is carried out in exchange for money or the value of money is referred to as economic activity. Workers in a factory, for example, are motivated by the desire to make a living. Those who engage in non-economic activities do so because they are motivated by emotions such as love, sympathy, or humanity rather than by monetary gain.

Examples include children playing in the garden or dancing, a woman preparing dinner for the family, or a boy assisting an elderly man cross a busy street, to name a few.

When comparing economic and non-economic activities, the most significant distinction is that economic activities are carried out to meet human requirements, whereas non-economic activities are carried out in order to satisfy psychological needs. Continue reading to learn more about the differences and similarities between these two types of human activities.

Economic Activities

Economic activity is defined as the provision, manufacture, purchase, or sale of commodities or services by individuals in order to meet their day-to-day requirements for survival. Economic activities are defined as any activity that is involved in the production, distribution, or utilisation of goods or services for a profit. Economic activities are any activities that involve the exchange of money or the exchange of goods or services. 

Economic activities include the production, distribution, exchange, and consumption of goods and services, to name a few examples of them. In order to earn a living and amass wealth, humans engage in economic activities.

The following are some examples of economic activity: traders, agriculturists, manufacturers, doctors, teachers, and factory labourers, to name just a few. Those who participate in these activities do so to supplement their income and accumulate wealth.

Manufacturing, distribution, exchange, and consumption of goods and services are the fundamental activities that underpin all economic activity. The returns on economic activity can be expressed in monetary terms. In this world, businesspeople make a profit, doctors collect payment for their services, and farmers grow to produce for making sales in markets.

Types of Economic Activities 

Economic activities, in reality, include anything that involves the exchange of money or the exchange of goods or services. The following are the three types of economic activities: 

Business

To make a profit, this economic activity entails providing goods and services to meet the needs of everyday people in order to generate income.

Profession

The term “profession” can also refer to an occupation or professional vocation that involves providing specialised services for a fee to the public.

Employment

The activity is carried out in accordance with the terms of a written agreement between the employer and the worker. Employees in this situation work for the company and are compensated for their efforts (wages or salary).

Characteristics of the Economic Activity

Reasons related to the economy

The primary goal of economic activity is to generate profit and thus accumulate wealth. Individuals participate in these activities in order to supplement their income through financial gain.

Making Use of Available Resources

Land, labour, and capital are all resources that must be utilised in order for economic activities to take place.

Use in a Reasonable Manner

It is possible to maximise profits in economic operations by allocating scarce resources in an efficient manner. This includes making the most of available resources such as land, labour, capital, and any other production-related assets.

Enforceable in the legal sense

Economic activities are limited to legitimate actions that are carried out for the purpose of gaining a monetary advantage. Breaking and entering, thieving, smuggling, and other illegal acts, for example, are not considered to be part of the definition of economic activity.

Accepted as a member of society

In all economic activities, it is necessary to adhere to social norms. They can’t possibly be unpopular in the community.

Difference Between Economic and Non-Economic Activities

It is possible to distinguish between economic and non-economic activities on the basis of the following characteristics:

• Economic activities are those that involve the production and consumption of goods and services for the purpose of gaining a monetary profit or benefit. Non-economic activity is defined as an activity that is carried out joyfully with the goal of providing services to others without regard for monetary compensation.
• Economic operations are carried out with the goal of generating profit in mind. However, non-economic actions are carried out for social or psychological reasons such as love or affection, rather than for monetary gain.
• However, non-economic activities are not measured in monetary terms; instead, they are measured in non-monetary terms.
• A pragmatic approach is taken by economic activities, which is to say that they approach problems in a practical manner. A more idealistic approach is taken by non-economic activities, which give higher precedence to human values than to financial gain.
• Economic activities, by virtue of the fact that they are carried out for profit, resulting in the creation and accumulation of wealth. Activities that are not economically rewarding, on the other hand, provide mental gratification and enjoyment.
• In order for the economy to function properly, economic activities must contribute to the growth of the country’s gross domestic product (GDP). Non-economic activities, on the other hand, have no impact on a country’s gross national income (national income).

Conclusion

Any human activity that is carried out in exchange for money or the value of money is referred to as economic activity. Workers in a factory, for example, are motivated by the desire to make a living. Economic activities are defined as any activity that is involved in the production, distribution, or utilisation of goods or services for a profit. Three types of economic activities are (1)Business (2)Profession (3)Employment. Ultimately, the primary goal of economic activity is to generate profit and thus accumulate wealth. Individuals participate in these activities in order to supplement their income through financial gain.

Economic activities are those that involve the production and consumption of goods and services for the purpose of gaining a monetary profit or benefit. Non-economic activity is defined as an activity that is carried out joyfully with the goal of providing services to others without regard for monetary compensation.