Relation between Engineering Economics & Technology

§   Relation between Engineering Economics & Technology

Engineering economics, “previously known as engineering economy”, is a subset of economics concerned with the use and application of economic principles in the analysis of engineering decisions.

Eugene L. Grant published the first Engineering Economic textbook in the year 1930.Grant can truthfully be called the father of Engineering Economy.

Engineering economics & Technology are closely related. Engineers and Technologists are called upon to analyze and select the most economical alternative among several design alternatives. They often play a major role in investment decisions based on the analysis and design of new products or processes.

The engineering economics is concerned the systematic evaluation of the benefits and costs of projects involving engineering design and analysis. Engineering economics quantifies the benefits and costs associating with engineering projects to determine if they save enough money to warrant their capital investments.

Engineering Economics has been defined as the social science of earning a living. With the same appropriateness Engineering Technology may be defined to be physical science applied to helping groups of men to make a better living.

It is widely accepted that technology is the key driver of economic growth of countries, regions and cities. Technological progress allows for  the more efficient production of more and better goods and services, which is what prosperity depends on.

Figure 1 Relation between Engineering Economics and Technology

However, the Procedures through which technology is developed, adopted and used in production are fall in Engineering Economics. Their more detailed analysis can allow for new findings that could have important impacts in many areas of policy, including science policy, research and development, industrial policy, and both national and regional development policies.

“A successfully engineered solution is one that only works from a technical perspective, butt also from an economic one”.