PDSnet Glossary

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Introductory Technical Fundamental Economics Opinion Sectors International Regulatory Other Markets

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Definition

That part of economics which looks at the economy as a whole and how it functions both internally and externally, in its relationships with other economies. This is as opposed to microeconomics which looks at the way that companies and individuals behave and what motivates them within the economy. So macroeconomics is concerned with the business cycle, the level of inflation, interest rates, the level of employment, fixed investment, and the money supply. Microeconomics is concerned with supply and demand, equilibrium pricing, utility and the propensity to save. Macroeconomics is generally of far more interest to investors because it impacts directly on the progress of the economy and the various sectors within it.

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