Here's the 1828 Webster's definition of economy:
ECON'OMY, n. [L. oeconomia; Gr. house, and law, rule.]
1. Primarily, the management, regulation and government of a family or the concerns of a household. 2. The management of pecuniary concerns or the expenditure of money. Hence, 3. A frugal and judicious use of money; that management which expends money to advantage,and incurs no waste; frugality in the necessary expenditure of money. It differs from parsimony, which implies an improper saving of expense. Economy includes also a prudent management of all the means by which property is saved or accumulated; a judicious application of time, of labor, and of the instruments of labor. ... 8. Judicious and frugal management of public affairs; as political economy. 9. System of management; general regulation and disposition of the affairs of a state or nation, or of any department of government.
Here's Wickipedia's definition:
Economics is the social science that studies the production, distribution, and consumption of goods and services. The term economics comes from the Greek for oikos (house) and nomos (custom or law), hence "rules of the house(hold)."
Here's a little more about the history of the word from a textbook on Macroeconomics.
1.1 Origin of the term "Economics"All three sources connect the origin of the word economy to Greek words connoting the rules or management of a household. Certainly, in earlier agrarian societies, the household, the small home business, and the family farm were the basic building blocks of the community's overall economy. Even though we are no longer an agriculturally based society, the home is essential to the health of national and global economy -- or, at least I believe that is so.
The term "economy," from which we get "economics," comes most directly from the Old French word "economie," meaning "management of a household." The French adopted the term from the Latin word "oeconomia," which was in turn derived from the Greek word "oikonomia." Oikonomia came from the word "oikonomos," which separates into "oikos," meaning house, and "-nomos" meaning managing.
The oldest recognized written work in the field of economics is Oeconomicus, a book on farming and household management, written by the Greek philosopher Xenophon (430?-355? B.C.).
Despite the Greek origins of the term, economics was not an important field of study for the ancient Greeks, who, despite occasional references to economic matters, were more interested in philosophy and ethics.
The inhabitants of a home form an economic unit. They manage an income. They purchase, store, and consume goods. In many cases, they produce and sell goods, as well. They save or spend, as they see fit. Many buy homes and invest in stocks.
Women of earlier eras prided themselves as having a key role in managing a home's economy. The Biblical reference in Proverbs 31 details a woman who is a capable and industrious steward of her family's resources. She is described by a Hebrew military term that roughly equates to our English words noble or valiant. It connotes someone who displays efficiency, physical strength, and moral excellence.
There are examples in literature, as well. For example, in David Copperfield, the efficient Agnes is contrasted with Dora, who is charming but unfit for managing the resources of her household. When the character of Agnes is first introduced, she is carrying a basket of keys. Women of that day used keys to open and close rooms, pantries, cupboards, sugar chests, and other storage places. Thus, in Agnes' case, Dickens uses keys to represent her domestic capability, and he associates it with her loving and efficient nature. She is contrasted with others in the novel who use keys as a means to imprison or control others.
For many who have read Gone with the Wind , Scarlett's pre-war flirtatious and thoughtless self epitomizes the Southern belle. The description of Scarlett's mother, Ellen, is more in line with the experience of most women of that era. She is a tireless and gracious steward of her family's resources, to the point of keeping the household and farm books and issuing instructions to the farm overseer. Ellen is a member of the South's upper class, with its regrettable reliance on slave labor. However, many of her peers lived on small farms and managed without enforced servants. Similarly, her northern counterparts managed homes and farms with out the aid of servants or with the help of paid labor.
In our modern American culture and in many other cultures, we have come to value women (and men) mainly as wage earners. Certainly, women who maintain full time jobs outside of the home have a great effect on our national and even global economy.
However, the home is now looked upon as a restrictive sphere, while the larger work place is seen as the the only valid arena for a career. The one exception to this is that the Internet has now made it possible for large numbers of people to either work a job from home or to operate a home business. Even at that, respect is given to the home worker only because the individual pulls in an outside paycheck.
If we undervalue the economic impact of the full time home manager, perhaps its because we've lost the vision of the home as the productive, thriving backbone of the overall economy. Those who are engaged in home management exercise, albeit on a smaller scale, the same skills utilized by those in corporate or nonprofit management, accountants, bankers, and financial officers. Whether or not the home steward does his or her job well directly impacts the lives of the other members of the household.
Similarly, how well individuals at home save, spend, or invest money largely determines the health of a community's or a nation's economic health. We are living in a time when many people embark on adult life with poor financial skills and little patience for building a healthy home economy over time. Large numbers of Americans carry alarming personal debts. Experts also warn that the baby boom generation has not planned well for their retirement years, and they fear that their needs will burden younger workers. Similarly, many people who bought more home than they could reasonably afford were caught unprepared for an economic downturn. Thus, many are losing their homes.
Whether in two-income families or one-income families, people are overstraining their home economies to the point that it is adversely affecting our national economic outlook. We, as a nation, are largely unprepared on an individual level to face crises in the larger economy -- such as the current high prices for gasoline. In general, American families have not stored emergency reserves. Of course, experts study what can be done to help the economy at the national level, as well they should.
However, one overlooked key is inspiring individual family units to manage well on a personal level. Whether or not the home manager makes this a career or not, it is a vital ingredient of our nation's economic health. It's worth learning to do it well, and it's worth developing the character that enables one to put sound financial principles into practice.
Perhaps, the skillful management of a home economy deserves some overdue respect.
Happy Reading and Writing!