Limitations Of Macroeconomics
(1):- Fallacy of composition- In macroeconomic analysis the Fallacy of composition is involved, aggregate economic behaviour is the sum total of individual activities but what is true of individuals is not necessarily true of the economy as a whole.
(2):- To regard the aggregate as Homogeneous - The main defeat is micro analysis is that is regards the aggregate as Homogeneous without carrying about their internal composition and structure. The average wage in a country is the sum total of wages in all occupations.
(3):- Aggregate variable may not be important necessarily- The aggregate variable which form of the economic system in of much significance for stands the national income of a country is the total of all individual income.
(4):- Indiscriminate use of macroeconomic misleading-
An indiscriminate and uncritical use of macroeconomic in analysing the problem of the real world can obtain be misleading.
(5):- Statical and Conceptual Difficulties- The measurement of macroeconomic concept involved a number of statical and conceptual difficulties. These problems relate to the aggregation of macroeconomic variable. If individual units, similar aggregation does not present much difficulties.
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