Economics Dictionary of ArgumentsHome
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| Microeconomics: Microeconomics is the study of individual consumers, firms, and markets, focusing on supply, demand, pricing, and resource allocation. It examines decision-making, market structures, and efficiency, contrasting with macroeconomics, which analyzes the economy as a whole. See also Macroeconomics, Economics._____________Annotation: The above characterizations of concepts are neither definitions nor exhausting presentations of problems related to them. Instead, they are intended to give a short introduction to the contributions below. – Lexicon of Arguments. | |||
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Friedrich A. von Hayek on Microeconomics - Dictionary of Arguments
Boudreaux II 61 Microeconomics/Hayek/Boudreaux: VsKeynesianism: By focusing on aggregate demand, Keynesian economics ignores the all-important ("microeconomic") details of an economy. Microeconomics: These vital details are how well or poorly each of the economy's many individual parts "fit" together and work together to generate goods and services for consumers, and to create job opportunities for workers. Example: If you have all of the parts of, say, an automobile scattered randomly about a large room, the main reason you do not have a functioning car is not that you do not want, or that you fail to "demand," such a car. Instead, the chief reason you have no functioning car is that those parts aren't fitted together in ways that allow them all to operate smoothly together so that a drivable and reliable car exists. Demand: It's true that no one will exert the energy and initiative required to assemble all of the parts into a working vehicle if there is no (or too little) demand for such a vehicle. VsKeynes: But your desire to have a drivable car is not really the main obstacle standing between you and a working vehicle. Knowledge: The main obstacle is the challenge of mobilizing all the knowledge involved in assembling these pieces into a car and motivating people to put forth the effort to perform that assembly. Macroeconomics/demand: The desire of nearly everyone to possess and consume automobiles, along with lots of other goods and services, can be depended upon always to exist. Problem: The challenge is to ensure that producers have the knowledge and the incentives actually to produce the goods and services that people want. Microeconomics: The challenge, in other words, is to get the economic details right so that produc-ers have both the knowledge and the incentive to produce the "right" mix of outputs. Relative prices are the main source of both this knowledge and these incentives. >Relative prices._____________Explanation of symbols: Roman numerals indicate the source, arabic numerals indicate the page number. The corresponding books are indicated on the right hand side. ((s)…): Comment by the sender of the contribution. Translations: Dictionary of Arguments The note [Concept/Author], [Author1]Vs[Author2] or [Author]Vs[term] resp. "problem:"/"solution:", "old:"/"new:" and "thesis:" is an addition from the Dictionary of Arguments. If a German edition is specified, the page numbers refer to this edition. |
Hayek I Friedrich A. Hayek The Road to Serfdom: Text and Documents--The Definitive Edition (The Collected Works of F. A. Hayek, Volume 2) Chicago 2007 Boudreaux I Donald J. Boudreaux Randall G. Holcombe The Essential James Buchanan Vancouver: The Fraser Institute 2021 Boudreaux II Donald J. Boudreaux The Essential Hayek Vancouver: Fraser Institute 2014 |
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