A.P. Lerner, a noted American economist “In microeconomics we are more concerned with the avoidance or elimination of waste, or with inefficiency arising from the fact that production is not organised in the most efficient possible manner. Such inefficiency means that it is possible, by rearranging the different ways in which products are being produced and consumed, to get more of something that is scarce without giving up any part of any other scarce item, or to replace something by something else that is preferred”
Importance and uses of microeconomics
It is microeconomics that tells us how a free-market economy with its millions of consumers and producers work to decide about the allocation of productive resources among the thousands of goods and services. As Prof. Watson says, “microeconomic theory explains the composition or allocation of total production, why more of some things are produced than others”
Prof. Lerner quote “Microeconomics teaches us that completely ‘direct’ running of the economy is impossible – that a modern economy is so complex that no central planning body can obtain all the information and given out all the directives necessary for its efficient operation”
