what is micro and macroeconomics and what is the difference?
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Micro analyzes what happens in small economic systems. It will look at how people make choices, how single markets work (with or without competition), how taxes affect outcomes, how to best manage public resources, etc.
Macro looks at big systems (usually no smaller than nations). It’s tempting to think that macro is just ‘added up’ micro, but it’s more complicated. First, all those ‘small’ systems interact in complicated ways. Second, concerns that might be minor in micro models are very important in macro (eg, sticky prices — prices that change relatively slowly — are crucial to monetary policy).
If you want to understand the dynamics of road resurfacing auction bids in Louisville between 2004 and 2015, you want a microeconomist. If you want an explanation of the early-80s disinflation under Paul Volcker, you want a macroeconomist.
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