Just as the father answers the second question...

Just as the father answers the second question, basing his answer on his own observations of his son’s conduct and on his experience with it, so does the science of economics fare: It explains the events of the economic life in the light of observation and experience. Thus do we come to know that the science of economics discovers what actually occurs in the economic life of social and natural phenomena, discussing their causes and interrelations.

The economic doctrine evaluates the economic life and outlines how it ought to be according to its own concepts of equity and the equitable method for regulating it. Science discovers, while doctrine evaluates. Science talks about what is already in existence and the reasons for its existence; a doctrine discusses what ought to and ought not to be.

Let us start with the illustrations which distinguish between the function of science and the role of the doctrine in discovering and evaluating: The First Example Let us take the example of the link between the market price and the degree of demand: We are all aware, from our everyday life observation, of the fact that when a commodity is more in demand and the public’s desire to purchase it is increasing, its price will rise.

If we author a book in, say, mathematics, and it is sold for ¼ dinar, and if the ministry of education decides to use it as a school textbook, and if the students’ demand for it increases, its market price will accordingly increase. So is the case with all other goods: Their prices are linked to the degree of market demand; when demand increases, price, too, will increase.

This link between price and demand is included in the calculation of both science and doctrine; but each treats it from its own particular angle. The science of economics studies it as a phenomenon which takes shape and is found in the free market, the market that is free of enforcement of pricing restrictions on goods by a higher authority such as the government.

It explains how this phenomenon takes shape as a result of the market’s freedom, and it finds out the extent of the link between the price and the degree of demand. It explains whether the link between the price and the degree of demand is the same for all goods, or whether only some prices are affected when they are more in demand than others.