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Occupational Outlook Handbook

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The Occupational Outlook Handbook is the government's premier source of career guidance featuring hundreds of occupations-such as carpenters, teachers, and veterinarians. Revised annually, the latest version contains employment projections for the 2022-32 decade.

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Read this to complete STEP 3 on your guided inquiry worksheet.

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What is capitalism?

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Capitalism is the moral social system as it leaves the individual free to be virtuous - to pursue the good - by acting by reason.

"The moral justification of capitalism does not lie in the altruist claim that it represents the best way to achieve 'the common good.' It is true that capitalism does-if that catch-phrase has any meaning-but this is merely a secondary consequence. The moral justification of capitalism lies in the fact that it is the only system consonant with man's rational nature, that it protects man's survival qua man, and that its ruling principle is: justice." - AYN RAND
EXPLORE THE ETHICS OF CAPITALISM >
2. Individualism regards the individual (not the collective) as a sovereign being

Individualism is not opposed to one living in society as a trader; it is opposed to one living as a slave.

"Individualism regards man-every man-as an independent, sovereign entity who possesses an inalienable right to his own life, a right derived from his nature as a rational being. Individualism holds that a civilized society, or any form of association, cooperation or peaceful coexistence among men, can be achieved only on the basis of the recognition of individual rights-and that a group, as such, has no rights other than the individual rights of its members." - AYN RAND
EXPLORE THE CONCEPT INDIVIDUALISM >
3. The trader principle is the basis of all moral relationships

Individualism is based on the principle of trading value for value for mutual benefit (as opposed to coercion and compulsion.)

"The principle of trade is the only rational ethical principle for all human relationships, personal and social, private and public, spiritual and material. It is the principle of justice." - AYN RAND
EXPLORE THE TRADER PRINCIPLE >
4. Freedom is the absence of physical coercion

In a political context, freedom does not mean "freedom" from want, need, and the laws of reality.

"Since knowledge, thinking, and rational action are properties of the individual, since the choice to exercise his rational faculty or not depends on the individual, man's survival requires that those who think be free of the interference of those who don't. Since men are neither omniscient nor infallible, they must be free to agree or disagree, to cooperate or to pursue their own independent course, each according to his own rational judgment. Freedom is the fundamental requirement of man's mind." - AYN RAND
EXPLORE THE MEANING OF FREEDOM >
5. Individual rights define one's freedom of action in a social context

All rights are rights to freedom of action: the right to those actions necessary to rationally support one's life - so long as one does not violate the equal rights of others.

"'Rights' are a moral concept-the concept that provides a logical transition from the principles guiding an individual's actions to the principles guiding his relationship with others-the concept that preserves and protects individual morality in a social context-the link between the moral code of a man and the legal code of a society, between ethics and politics. Individual rights are the means of subordinating society to moral law." - AYN RAND
EXPLORE THE CONCEPT INDIVIDUAL RIGHTS >
6. The initiation of physical force is the only way to violate rights

The individual can only be stopped from acting rationally by the initiation of physical force (including fraud).

"It is only by means of physical force that one man can deprive another of his life, or enslave him, or rob him, or prevent him from pursuing his own goals, or compel him to act against his own rational judgment. The precondition of a civilized society is the barring of physical force from social relationships-thus establishing the principle that if men wish to deal with one another, they may do so only by means of reason: by discussion, persuasion and voluntary, uncoerced agreement." - AYN RAND
LEARN WHY THE INITIATION OF PHYSICAL FORCE IS EVIL >
7. Government's purpose is to protect individual rights

Government's job is to ban the initiation of physical force from all relationships, making all relationships voluntary.

"The only proper purpose of a government is to protect man's rights, which means: to protect him from physical violence. A proper government is only a policeman, acting as an agent of man's self-defense, and, as such, may resort to force only against those who start the use of force." - AYN RAND
EXPLORE THE NATURE OF GOVERNMENT >
8. Government actions are regulated so that individual rights can be protected

Capitalism is based on a rule of objective law founded on the principle of individual rights, as opposed to a "rule of men."

"All laws must be objective (and objectively justifiable): men must know clearly, and in advance of taking an action, what the law forbids them to do (and why), what constitutes a crime and what penalty they will incur if they commit it." - AYN RAND
EXPLORE THE CONCEPT OF OBJECTIVE LAW >
9. A free-market is an economic system based on individual rights

A free-market bans physical force, fraud, and coercion from all economic relationships, resulting in voluntary cooperation between buyers and sellers (trade), and peaceful competition between buyers and between sellers.

"In a free economy, where no man or group of men can use physical coercion against anyone, economic power can be achieved only by voluntary means: by the voluntary choice and agreement of all those who participate in the process of production and trade. In a free market, all prices, wages, and profits are determined-not by the arbitrary whim of the rich or of the poor, not by anyone's "greed" or by anyone's need-but by the law of supply and demand. The mechanism of a free market reflects and sums up all the economic choices and decisions made by all the participants. Men trade their goods or services by mutual consent to mutual advantage, according to their own independent, uncoerced judgment." - AYN RAND
AN INTRODUCTION TO THE SCIENCE OF ECONOMICS >
10. Capitalism is the system of progress; statism is the system of plunder

The alleged failures of capitalism are actually caused by the success of statism.

"A statist is a man who believes that some men have the right to force, coerce, enslave, rob, and murder others. To be put into practice, this belief has to be implemented by the political doctrine that the government-the state-has the right to initiate the use of physical force against its citizens. How often force is to be used, against whom, to what extent, for what purpose and for whose benefit, are irrelevant questions. The basic principle and the ultimate results of all statist doctrines are the same: dictatorship and destruction. The rest is only a matter of time." - AYN RAND
LEARN OF CAPITALISM'S HISTORY OF PROGRESS >

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Capitalism is the moral social system as it leaves the individual free to be virtuous - to pursue the good - by acting by reason. "The moral justification of capitalism does not lie in the altruist claim that it represents the best way to achieve 'the common good.'

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What are the similarities and differences between micro and marcoeconomics?

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What's the difference between micro and macro economics? These two economic disciplines can see confusing at first glance, but once you learn their focus it's easy to differentiate microeconomic issues and questions from macroeconomic ones.

In this blog post, you'll learn the difference between micro and macro economics, as well as specific examples of micro and macro economic problems. Read on to learn the basics of microeconomic and macroeconomic thought, study and analysis.

Do you want to learn about micro and macro economics in greater detail? Enroll in our Micro & Macro Economics course to learn the specifics of economics, from basic principles of supply and demand the characteristics of the business cycle.

Microeconomics vs. macroeconomics

The difference between micro and macro economics is simple. Microeconomics is the study of economics at an individual, group or company level. Macroeconomics, on the other hand, is the study of a national economy as a whole.

Microeconomics focuses on issues that affect individuals and companies. This could mean studying the supply and demand for a specific product, the production that an individual or business is capable of, or the effects of regulations on a business.

Macroeconomics focuses on issues that affect the economy as a whole. Some of the most common focuses of macroeconomics include unemployment rates, the gross domestic product of an economy, and the effects of exports and imports.

Does this make sense? While both fields of economics often use the same principles and formulas to solve problems, microeconomics is the study of economics at a far smaller scale, while macroeconomics is the study of large-scale economic issues.

Both fields of economics are interdependent

At first glance, micro and macro economics might seem completely different from one another. In reality, these two economic fields are remarkably similar, and the issues they study often overlap significantly.

For example, a common focus of macroeconomics is inflation and the cost of living for a specific economy. Inflation is caused by a variety of factors, ranging from low interest rates to expansion of the money supply.

While this might seem like a purely macroeconomic field of study, it's actually one that's very important in microeconomics. Since inflation raises the price of goods, services and commodities, it has serious effects for individuals and businesses.

On a microeconomic level, this has several effects. Businesses are forced to raise their prices in response to the increased cost of materials. They also need to pay their employees more over the long term to account for the higher cost of living.

This is just one example of a macroeconomic phenomenon - in this case, inflation and a rising cost of living - affecting a microeconomic one. Other macroeconomic decisions, such as the creation of a minimum wage or tariffs for certain goods and materials, have significant microeconomic effects.

Do you want to gain a detailed understanding of macroeconomics? Enroll in our Economics Without Borders course to learn how currencies, central banks and a wide variety of other factors affect national and global economies.

Examples of microeconomic issues

Microeconomics seeks to solve problems on a small level. Some economics like to describe microeconomics as the study of economics and behavior from the bottom up, since it's focused on the effects of low-level decisions on the economy.

An example of a microeconomic issue could be the effects of raising wages within a business. If a large business raises its wages by 10 percent across the board, what is the effect of this policy on the pricing of its products going to be?

Since the cost of producing products has increased, the price of these products for consumers is likely to follow suit. Likewise, what will happen if a company raises wages for its most productive employees but fires its least productive workers?

These are the type of questions microeconomics aims to solve. Microeconomics is also useful for studying the effects of your own decisions. One of the most common principles in microeconomics is opportunity cost.

Opportunity cost is the value of making one decision over another. A decision that involves economy cost is the choice of one meal instead of another: by choosing a certain food, you miss out on the benefits offered by another.

Choices involving opportunity cost could relate to your career. By choosing one job over another, you may gain opportunities but lose others. In addition to factors like supply and demand, opportunity cost is one of the principles of microeconomics.

Learn more about opportunity cost, including several examples of the opportunity cost of career choices and buying decisions, in our blog post on the opportunity cost formula.

Due to the narrow focus of macroeconomics, it's an incredibly valuable skillset for making decisions in your own life. Learn more about intelligent decision making in our Cognitive Biases: Learn to Master Decision Making course.

Examples of macroeconomic issues

While microeconomics focuses on the effects a certain decision has on individuals and businesses, macroeconomics looks at the bigger picture. In macroeconomics, a common issue is the effects of certain policies on the national or regional economy.

For example, while a microeconomist might study the effects of low interest rates on individual borrowers, a macroeconomist would observe the effects that low interest rates have on the national housing market or the unemployment rate.

Another common focus of macroeconomics is the way taxes affect the economics of a nation. A macroeconomist would look at the effects of a decrease in income taxes using measures like GDP and national income, rather than individual factors.

Do you want to learn more about macroeconomics? Discover how interest rates and trade policy affects the national economy by enrolling in our 21 st century economics course, How The Economy Really Works.

The importance of a balanced economics education

Microeconomics and macroeconomics have a lot in common, and the skills used to solve small-scale economic issues are often identical to those used to find solutions to large-scale economic problems.

Learn the impact of economic variables on small firms, individuals, households and the economy as a whole in our Micro & Macro Economics course. Designed for new economics students, this in-depth course is an excellent introduction to macro and micro economics.

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difference between micro and macro economics

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The Difference Between Micro and Macro Economics

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What's the difference between micro and macro economics? These two economic disciplines can see confusing at first glance, but once you learn their focus it's easy to differentiate microeconomic issues and questions from macroeconomic ones.