There are approx. 300M decision makers in the US making economic decisions on a daily basis
Without simplification, economics is hopeless
Milton Friedman: map-analogy. An economic model is a picture of the economic system that leaves certain features out and highlights others, which are relevant for the question at hand.
Models are mathematically formulated, but experiments are difficult/impossible. Relies mostly on passive observations. (akin to astronomy and climatology)
A social science, deals with human behavior. akin to psychology.
Lucas critique: if something is the economy changes, economic agents may change their behavior, so that we have to be explicit about what is stable/structural.
Dynamics and expectations
Agents are forward-looking, expectations matter.
Agents do not make systematic mistakes? — they sometimes do