Economic activities refer to all those human activities which are undertaken to earn a living and thereby satisfy human wants. The main objects of these activites are to earn income and create wealth.
The money earned through work is used to satisfy wants. For example, a teacher teaches in a school or college, a doctor attends to patients in his clinic and a shopkeeper sells goods to his customers.
Economic activities are concerned with the production, distribution and exchange of goods and services. These activities create utilities and result in the production of wealth. Economic activities are also called occupations.
Characteristics of economic activities
The main characteristics of economic activities are as follows:
(i) Economic motives:
Economic activities are undertaken to earn money and acquire wealth. The main motive behind these activities is to make an economic gain. These activities are performed by human beings for earning livelihood.
Economic activities involve production, distribution and exchange of goods and services for satisfying human wants. These activities are directly related to creation of wealth.
(iii) Economic resources:
Economic activities make use of economic resources such as land, labour, capital, etc.
(iv) Rational Use:
Economic activities require proper allocation of scarce resources so as to obtain maximum output from them. These activities involve optimum utilisation of land, labour, capital and other factors of production. Welfare of society can be maximised when best possible use of resources is made.
(v) Economic Growth:
Economic activities determine the level of economic development of a country and the standard of living of its citizens.
(vi) Legally valid:
Human activities performed for economic gain are called economic activities only when they are lawful. Unlawful activities such as gambling, blackmarketing, theft, dacoity, smuggling etc., are opposed to public interest. Therefore, these activities cannot be called economic activates.
(vii) Socially desirable:
Economic activities are desirable for society. They must be in accordance with the expectations and norms of society.