economy n.

1530s, "household management," from Latin oeconomia (source of French économie, Spanish economia, German Ökonomie, etc.), from Greek oikonomia "household management, thrift," from oikonomos "manager, steward," from oikos "house, abode, dwelling" (cognate with Latin vicus "district," vicinus "near;" Old English wic "dwelling, village," from PIE root *weik- (1) "clan") + nomos "managing," from nemein "manage" (from PIE root *nem- "assign, allot; take").

The meaning "frugality, judicious use of resources" is from 1660s. The sense of "wealth and resources of a country" (short for political economy) is attested from 1650s, but even in the 1780s the American Founders in laying out the new republic generally used economy only as "frugality." So also in that sense in the Federalist, except in one place where full political economy is used.

Col Mason — He had moved without success for a power to make sumptuary regulations. He had not yet lost sight of his object. After descanting on the extravagance of our manners, the excessive consumption of foreign superfluities, and the necessity of restricting it, as well with oeconomical as republican views, he moved that a Committee be appointed to report articles of Association for encouraging by the advice the influence and the example of the members of the Convention, oeconomy[,] frugality[,] and american manufactures. [Madison, Sept. 13, 1787, in Farrand, "Records of the Federal Convention;" the motion was agreed to without opposition]

1821 as a term in advertising, at first meant simply "cheaper," then "bigger and thus cheaper per unit or amount" (1950). See economy (n.).