What is Scarcity?
Scarcity refers to the limited available resources used in satisfying the unlimited human wants. These resources are scarce relative to their demand. It is as a result of scarcity of resources that made the study of Economics very essential in order to find alternative uses of these scarce resources. The available resources cannot satisfy all human wants. Since human wants are unlimited or insatiable relative to the available resources, we have to choose the most pressing ones and leave others that are less important because resources are scarce.
For instance ten students need ten pairs of school sandals but they are able to buy seven pairs of school sandals due to the insufficiency of resources (money), it therefore implies scarcity of school sandals relative to the needs of the student.
Economically, resources such as money, material, time, productive resources etc are relatively scarce to the people’s demand.
The producers, consumers as well as government face the problem of scarcity and this leads us to the study of what to produce, how to produce, for whom to produce and howto distribute.
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