How to Study Economics

If you want to study economics, be prepared to learn about the big picture and the little picture. The big picture, or macroeconomics, deals with the overall economy. The little picture, or microeconomics, deals with financial decisions that individuals and businesses make. Let's review five steps for each. Be aware that economics is a social science. We tend to talk about it as numbers and facts but economics usually comes down to how people make decisions and what factors influenced their decision making process.

MACROECONOMICS

Step 1 -Watch business news on television. CNBC, CNN, Bloomberg, and the BBC will give you an overall picture of the economic world. You'll learn about stock markets, global trading, currency fluctuations, and political issues that affect the economy.

Step 2 - Read the Wall Street Journal (WSJ) and other news agencies dedicated to financial markets. WSJ sets the standard for financial news journalism.

Step 3 - Do an Internet study on the words Wall Street. Learn to decipher helpful stories from the less helpful.

Step 4 - Frequent the library or bookstore and pick up economics history books. Consider books written by Adam Smith's and Milton Friedman. Find a current textbook as economic thought changes rapidly.

Step 5 - Visit an institution of economic influence. Take a tour of a Federal Reserve Bank, the United States Mint, or any stock or commodity exchange.

MICROECONOMICS

Step 1 - Take a good hard look at your own finances. How much money do you make? How much do you spend? How do you use credit? What motivates you to make money? How do you make decisions about spending your money? Start a study group with friends where you explore these questions.

Step 2 - Visit your local chamber of commerce to see what they offer in terms of small business resources. Meet with business owners in your local community to see what their short term and long term plans are.

Step 3 - Take a course at a nearby community college on personal finance or money management. Integrate what you learn with your own personal financial situation.

Step 4 - Find a reliable personal financial planner. Interview the financial planner to determine his or her financial perspectives. After finding someone you trust, use their help to put together a financial plan. This experience will tie all the pieces of your study together allowing you to move forward in your financial life.

Step 5 - Review your macroeconomic studies to see how the big picture of the nation and the world affects your little picture of personal finance, career, and money management.

A study of economics not only broadens your worldview, it will enable you to make sound financial decisions for yourself, and to become a financial counselor for others. Economics is a fascinating and vital aspect of everyone's world. Know your big and little economy well.