Educative Site Free Online Academic Courses Tutorials, Books with enough questions and answers
Micro economics deals with the behavior or small parts and units of economics and their functions. But micro economics has some limitations which are discussed below:
1. Consideration of unrealistic assumption: In micro economics analysis most of the cases we take resort of some assumptions which is not realistic. Moreover, for the changes of those assumptions, the theories may have changes. And theories may not operate.
2. Full employment: Most of the theories of micro economics are based on full employment. But in real world full employment is quite absent.
3. Laissez fair: Most of the micro economic concepts are based on Laissez-fare is not available anywhere. Therefore, these theories cannot compare to real world.
4. Considering other things remaining unchanged: In micro economics to analysis the relationship of one variable with another variable other thing remaining constant is considered.
5. Macro views are neglected: In micro economics small units are analyzed separately. Consequently the economic system as a whole is neglected. Trying to have an overall view through summing the small units of economy may be fruitless.
6. Micro concepts are narrow concepts: As micro economics analysis analysis is done as small part therefore, micro concept are comparatively narrow as well as its scope is also narrow
Although there are some limitations in micro economics in spite of it from the viewpoints of analyzing economic variables micro economic variables micro economics has great importance.