What is Microeconomics?

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A definition:

• Microeconomics is the social science concerning the interactions of rational decisions about allocation of scarce resources.
  • Compare macroeconomics: "the social science concerning the flows of scarce resources and products in the economy."

In the definition of microeconomics

• Social and interaction both indicate that behaviors of different individuals affect each other.
• Allocation simply means a decision about use of a resource.
• Rational here does not imply "profit maximization", or even conventional wisdom ("joushiki") or usual morality. Merely that the decisions are systematically intended to accomplish well-understood goals. (I.e., profit maximization is a typical example of such a goal.)
• A resource is anything useful, whether natural or artificial. A resource is scarce if somebody somewhere could use a little bit more of it (for free).

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