Choice under constraints
Represent households and firms as choosing among feasible alternatives while keeping preferences, technology and constraints separate.
Side 158Side Studies / Research
Subject
Microeconomics
Purpose
Individual and firm decisions studied through preferences, constraints, prices, incentives, strategic interaction and market structure.
Structure
05 movesSystem mapV0
Components → constraints → flows → control → failure
Build markets from constrained choices and interaction.
Microeconomics becomes useful when optimization is connected to institutions and strategic response rather than treated as a collection of isolated curves.
Supply, demand & equilibrium
Study how decentralized choices interact through prices and how comparative statics change equilibrium conditions.
Market power
Compare competitive, monopolistic and oligopolistic settings where one actor's choice changes the environment facing others.
Information & incentives
Analyze hidden information, hidden action and contract design when parties do not observe the same things.
Externalities & institutions
Study cases where private choices impose costs or benefits on others and compare institutional responses rather than assuming one remedy.
Keep the boundaries visible.
preference ≠ welfare
equilibrium ≠ social optimum
price ≠ cost
Questions that organize the Side.
When does a market equilibrium fail to maximize total surplus?
How do information asymmetries change which trades occur?
Which institutional details determine whether an incentive has the intended effect?
What should carry weight here?
Use experiments, natural experiments and administrative data alongside theory; welfare conclusions require explicit assumptions beyond observed choice.