Since the term economics encompasses so many different things, you'll have to decide what aspects of economics for kids are appealing to your kids to learn as well as what concepts you can introduce that your children will be able to grasp. After all, even the youngest child can understand supply and demand when the theory is attributed to something like cookies.
Basic Economics Explained
You probably already know more about economics than you thought, but here is the basic theory behind economics:
Supply and Demand
Economics studies the relationship between people and the goods they purchase and sell. Supply and demand points to a couple of basic truths:
- When something is in demand, production increases.
- When something is not in demand, production halts or slows.
There are exceptions to these rules, of course, because occasionally a supplier will create a false shortage in an attempt to make consumers feel as though a certain product is rare and coveted. This compels some consumers to spend more for something either because they want to have something that not everyone has, or because they feel as though there is a shortage so they must attain it while they can.
Economics for Kids as a Social Science
You need not feel intimidated about trying to teach economics for kids. Economics is not a mathematical science; it's a social science. You don't have to have a full understanding of mathematical theories to effectively teach kids about economics.
The trick is to keep everything simple and to keep it relatable. Kids will grasp economic theories more easily when the subject is presented in an uncomplicated way.
Make it Understandable
Kids of various ages will respond well to age-appropriate tactics for learning basic economics.
- Toddlers and preschoolers can begin to learn about the very basic economic principles by role playing. Set up a pretend store and demonstrate how people pay for goods and how the store stocks the products according to what the customers buy.
- Elementary school aged kids are ready for an allowance, and this can be a powerful tool in learning all about economics. Don't just give your kids an allowance and allow them to spend with reckless abandon. Use it as a great opportunity to help kids examine why they spend money in addition to how they spend money.
- Older kids are ready for more advanced economic theories and may actually start to get introduced to economics in school curriculum. You might want to buy some books that are designed to teach economics for kids. Examples of these types of books include:
- How Economics Works by Laura Ann Gilman
- What Economics is About distributed by The National Council on Economic Education
- Economics for Kids by Mark C. Schug
Board games that can help you teach economic principles to kids include Monopoly, Life, and a variety of other games.
Demonstrate Economic Principals
You can go beyond role playing and educational materials regarding economics for kids by using your own spending and earning as examples. Older children may have the capacity to understand the intricacies about the family economic situation, but even younger children can be taught about economics when you turn everyday situations into learning opportunities.For example, a trip to the mall can be about much more than merely looking for sales and trying on clothes. You can bring up questions to your children that might help spark a real interest in economic theories:
- Why do you think people like sales?
- Why do some people carry calculators when they shop?
- Why do you think the mall is busier near payday?
- Why do you think that store advertises some products as "limited quantities available?"
Ask the questions, and prompt your children to answer based on what they know so far about economics. You may be surprised at some of the astute observations even the youngest child may present when quizzed about the economics they encounter in everyday life.