5 Uses For

Learning More About Financial Regulation in Microeconomics and Macroeconomics

Microeconomics and macroeconomics are two disciplines in economics that any economics student is very much familiar with. And sadly, these two disciplines are against each other. Currently, changes toward the financial services industry are palpable. There are many things that are affecting the financial regulation of the country. In the present-day financial services industry, there are two major forces that are coming face to face. Microeconomics is the area of business that students often lean towards. For this business area, people strive toward maximizing their profits. Businesses can make as much money as possible through fixed costs and marginal costs. Simply put, microeconomics views the world using the eyes of the CEO. A CEO does the best that they can for the company to deliver value and make more money.

With macroeconomics, on the other hand, it appeals more to all the policy nerds. For such an economic discipline, the primary goal is to attain market equilibrium. Simply put, services and goods with the greatest number can be exchanged between sellers and buyers with the application of mutually agreeable prices. You get a good competition between business establishments. What is bad for businesses will be oligarchies and monopolies. If you look at the world with macroeconomics, you are using the eyes of the government. In essence, this economy strives to make everyone involved happy, which often opposites making everyone equally unhappy too.

Since these two perspectives are very much different, it is expected that they will go against each other in various instances. Though most people are aware that efficient markets will benefit everyone, the steps to get there that the government must take often go against the microeconomic business interest. If necessary, the government, especially the financial industry, may block a merger so that they can promote competition in businesses. For sellers and buyers to make informed decisions, too, legislation of disclosures may be necessary. At the same time, certain activities must be stopped or regulated so that some will not be harmed by others financially.

You can always expect the government and business sector to fight over market regulation extent. Unfortunately, the battle between microeconomics and macroeconomics stops when everyone is happy with the booming economy. When businesses make money, they become happy. You get happy consumers too if these people have money. The government is quite happy because the system is working just fine for everyone.

But then, the financial services industry can come to a ruin with how present-day financial crises are showing. Any market bubbles are the responsibility of government regulators. It is also their job to recommend the necessary financial and securities regulations and measures to prevent whatever is going on from harming the economy.

Doing The Right Way

What Has Changed Recently With ?