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We can date the origins of modern economics in 1776, the year when Adam Smith published the classic An Inquiry into the Natures and Causes of the Wealth of Nations. In this book, Smith correctly laid out the basic principles of market economy.
Smith can be rightly considered the founder of the field of microeconomics, the branch of economics which today is concerned with the behaviour of individuals entities such as markets, firms, and households. In The Wealth of Nations,Smith considered how individuals prices are set, studied how the prices of land, labour, and capital are set, and inquired into the strengths and weaknesses of the market mechanism. By contrast, macroeconomics, is concerned with the overall performance of the economy. Macroeconomics takes a more wide-angle view of the economy.
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