SA28. Economics is a Natural Science by Duncan Pickard

What is Science? The dictionary defines science as knowledge, the truth of which is certain. The scientific method and the advancement of science are based on the search for truth.

Economics is currently seen as a Social Science but it is a Natural Science because the production and distribution of wealth obey Natural Laws, as natural as the Law of Gravity. The Natural Laws of Economics were described by Classical Economists, the most important being Adam Smith, David Ricardo and Henry George:

People try to achieve their ambitions with the least exertion.

1. Land, urban and rural, in more favourable locations yields more wealth from the same input of capital and labour than land in less favourable locations.
2. Whenever the population grows and production increases, the demand for land rises, which inevitably increases its economic rental value.
3. Unless the economic rental value of land is collected annually to fund the necessary functions of government, taxes have to be levied on trade, wages and interest. These harmful taxes impede employment and enterprise and result in unemployment, poverty, misery and inequality. The Natural Laws of Economics obtain throughout the world and in all locations.

Economic Rent, being the surplus remaining after labour and capital have received their just returns for their involvement in the production of wealth, is predominantly taken by those who own land but make little or no contribution to its increase in value. The Classical Economists recognised Economic Rent as the natural source of revenue for the funding of government; instead, it is taken by those who own land, as unearned income, enabling them to become richer while those who are not landowners become poorer. Since taxation is at the expense of economic rent, there is sufficient economic rent to fund the necessary functions of government, the total costs of which would be greatly reduced if all the harmful taxes were abolished.