Limitations of Macro Economics

There are, however certain limitations of macro economic analysis. Mostly these stem from attempts to yield macro economic generalizations from individual experiences. 

1. Fallacy of Composition: 

In macro economic analysis the,’ fallacy of composition’ is involved, that is, aggregate economic behaviour is the sum total of individual activities. But what is true of individuals is not necessarily true of the economy as whole.

Note: This is published for the internal use (of St. Philomena's College students) only and hence requires verification. 

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