What Are the Branches of Economics?

Economics is one of the basic core courses in almost all college degrees. It is the academic study of how money operates, and the interaction of money between consumer and business. Economics can be best divided into its two main branches: Macroeconomics and Microeconomics. Each of these main divisions and its sub-classes serves to illustrate all the distinct functions of various economies.
  1. Macroeconomics

    • Macroeconomics is the study of the entire economy -- its behavior, main elements and overarching systems. The scale of these macroeconomic discussions are typically on a country level and utilizes facts from that country's economic performance -- gross domestic product, inflation, government interest rates and unemployment. This also touches upon international trade and the overall impact of imports and exports has on a country's economic growth.

    Sub-Branches of Macroeconomics

    • Some important sub-topics in macroeconomic discussions are the factors affecting a country's stabilization policies and supply-side economics. Stabilization policies include the ability of a government to control its economic growth through employing fiscal and monetary policies during boom and recession periods. Supply side economics deals with the country's production rate of its goods and how it can leverage absolute and competitive production advantages against competing countries: creating a product mix for optimum export levels and growth.

    Microeconomics: General

    • Microeconomics is the study of transactions between people and businesses and how the flow of money operates between these basic entities. This includes business investment and personal savings. Microeconomics also focuses on the supply and demand relationship between buyer and seller and how this ultimately determines equilibrium prices of goods and services.

    Sub-Branches of microeconomics

    • Microeconomic sub-branches are the study of specific monetary activities that are enacted by either businesses or individuals. Some significant knowledge bases are the network effect and consumer theory. The network effect outlines the ability of a micro-economy to generate additional cash inside its system self-sufficiently. This is illustrated by the money growth effects of consumer-bank, business-investment and consumer-business relationships. Consumer theory is the study of how quantitative and qualitative factors affect consumer spending and saving. Some topics in this theory include the effect of lending interest rates, labor investment and technological trends have in encouraging consumerism.

Learnify Hub © www.0685.com All Rights Reserved