"What Is Macroeconomics?" Macroeconomic Theory I: Fall 2012
The goal of our first lecture will be to understand what sort of things we will study in a course called macroeconomics. How does this subject differ from microeconomics? I will begin with some analogies. Remember that analogies are just analogies: the correspondences are not exact! First analogy: Microeconomics resembles the study of the weather at a particular moment and place, or in a limited locale: "Wow, it's pouring here right now!" (This analogy in particular is less than exact, but we are just trying to get a general grasp of things right now, to get us going.) Microeconomic questions are like asking, "How does the wind move in this canyon?" or "Why is the rainfall so much heavier on one side of this mountain than on the other?" Macroeconomics resembles the study of regional or global weather patterns . Macroeconomic question are analogous to asking "How will El Niño affect weather in the United States this year?" or ...