Consumer’s Analysis

Abstract

In economic theory it is a well-founded tradition to consider individual decisions as the starting point on which to build various models. The foundation of this tradition is, of course, one variant of the so-called “methodological individualism”, which more or less states that to understand the whole it is enough to understand the behaviour of the various parts, and how they are interconnected. In economics the fundamental decision units are the consumers, or households, and the producers, or firms. The Government can be modelled as a consumer-producer.