What Are the Two Major Divisions of Economics?
The two major divisions of economics are macroeconomics and microeconomics. Macroeconomics is the branch of economics that deals with the behavior of an entire community or country, and microeconomics is the branch of economics that deals with the economic behavior of a specific segment.
Macroeconomics is the economics of production levels, the gross national product of a country or the unemployment rate of a city or nation.
Microeconomics is more specific. It deals with consumers and consumer spending, specific business firms, prices of products and the effect of those prices on the market.
Breaking economics down further shows that there are even smaller divisions. Production, consumption, distribution, exchange and public finance are all smaller divisions of economics.
Production relates to the manufacturing process of goods and how it relates to the utilization of products and services by consumers. Distribution relates to how the produced goods are delivered to consumers and exchange delves into the way products are transferred from one person to another. Public finance looks at how governments implement financial policies like taxation, and how that implementation affects the consumer.
Breaking down economics even further, there is the land, labor, capital, entrepreneur and foreign exchange, all of which are used in the production in economics.