ABSTRACT
This chapter introduces the scope and method of microeconomics, using real-world examples like university admissions to illustrate how different allocation mechanisms affect equity, incentives, and efficiency. It emphasizes economics as the study of scarcity, resource allocation, and decision-making. We discuss the historical roots of the field—from Adam Smith to modern globalized markets—and how economic models help us understand individual behavior, market outcomes, and public policy. The chapter presents the microeconomic method: modeling choices as deliberate, utility-maximizing behavior under constraints. We explain the importance of simplifying assumptions and introduce models as tools for clarifying trade-offs and counterfactuals. We also contrast markets like potatoes, education, and kidney donations to highlight how institutional context and moral limits shape economic analysis. Finally, we outline the structure of the book, which builds from competitive markets to market failures, uncertainty, and digital platforms, forming a foundation for further studies in macroeconomics, labor, public, and international economics.
