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27 July, 18:57

Macroeconomists focus on just a few key statistics when trying to understand the health and trajectory of an economy because

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  1. 27 July, 20:54
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    Economics is the science that studies the most efficient way to allocate scarce resources. It is a social science because it cannot carry out scientific experiments that cover the whole economy because there are simply billions of factors that cannot be accounted for. It focuses on data regarding the behavior of individuals and organizations in order to formulate economic theories that cannot be scientifically proved even after they are put into practice.

    Only some microeconomic experiments can be carried out for specific events regarding one company or industry, but they are done in a very small scale and assuming a lot of ceteris paribus (all other things constant).

    Macroeconomics focuses on real GDP, unemployment and inflation mainly because the economic variables and transactions that take place within an economy are billions or trillions per year, and it is simply impossible to study all of them.
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