Microeconomy

Part of speech: noun

Definitions

1. A small-scale economic system, such as that of a single household, firm, or local community, operating within a larger national or global economy
2. The economic activity of a limited unit like a village, company, or family, considered as its own self-contained system of production and exchange
3. An economy on a small scale, such as one household, business, or community, studied for how its individual parts produce, trade, and use resources

Etymology: "Microeconomy" is a plain compound, built from the Greek prefix "mikros" meaning small, joined to "economy." The prefix "micro-" has been used in English since the 19th century to mean small or very small in scale, and it has since been attached to many nouns, from microscope to microchip. The base word "economy" carries its own long history. It descends from the Greek "oikonomia," meaning the management of a household, a sense that still lingers in phrases like "household economy." Over centuries the idea widened from running a home to managing the resources of a whole state, and only later became the abstract system of production and exchange we now call an economy. Combining the two produces a term for the workings of a small, bounded unit, such as a single household, a village, a firm or a local community, as opposed to a national or global system. The word is a transparent formation, so its meaning follows directly from its parts.