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Microeconomic Theory

Microeconomic Theory. "the purpose of studying economics is not to acquire a set of ready-made answers to economic questions, but to learn how to avoid being deceived by economists." Joan Robinson. “Economics is a study of mankind in the ordinary business of life” Alfred Marshall.

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Microeconomic Theory

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  1. Microeconomic Theory

  2. "the purpose of studying economics is not to acquire a set of ready-made answers to economic questions, but to learn how to avoid being deceived by economists." Joan Robinson

  3. “Economics is a study of mankind in the ordinary business of life” Alfred Marshall

  4. “Economics is what economists do” Jacob Viner “Economics is common sense made difficult” As seen by an undergraduate student

  5. Most economics can be summarized in four words: “People respond to incentives.” The rest is commentary. Steven Landsburg

  6. Economics is: The science of making decisions in the presence of scarce resources.

  7. Why theory? • “Statistics in the absence of theory is dangerous to your intellectual health!” Eugene Silberberg

  8. Economists use models • Models are not judged by their realism but by their usefulness • What is the most useless map in the world?

  9. To be useful a model has to be refutable

  10. ad hoc theories are not useful • An ad hoc theory explains only one case • Why do Americans drive larger cars than Europeans?

  11. as if • Does a pool player need to know the laws of trigonometry and physics to win?

  12. as if • “…getting out of bed in the morning and making breakfast involves more complex decisions than the average game of chess. (Will that fries egg kill me in twenty-eight years?)” Charles Wheelan

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