Economics [antikvár]

Preface People take up economics for different reasons. Some are preparing for a career in business, some wish a deeper understanding of government policy, and some are concerned about the plight of the poor or the unemployed. Our guiding principle in writing this book has been to provide a self-contained introduction which shows that economics is a subject offering powerful insights about the world in which we live. Two ideas have governed the level and range of material that we discuss. The first is that there is an essential, simple, usable body of economics that has to be learned in any intiroductory economics course. The second is that modem economics is more interesting and more readily applicable to analysis of the real world than traditional approaches suggest. The Core Chapters In the introductory chapters and in the core of both the microeconomics and macroeconomics parts of the book, the material covered is fundamental. We deal immediately with the tools economists use and we confront some common criticisms of economics and economists. In microeconomics we then provide an overview of supply and demand before analysing these forces in greater depth. This leads naturally on to market structure, factor markets, and an important section on welfare economics and government policy. In macroeconomics we start with national income accounting and go on to aggregate demand, fiscal policy, money and banking, government policy, and international trade and payments. Even in the core, we go beyond the standard introduction to economic reasoning and simple theories. Theories should be confronted with the relevant facts and can be used to discuss policy options. Our discussion emphasizes a blend of theory, applications, and policy analysis that brings economics across as tiie live social science that it is. Our examples use actual facts and figures about the UK and many other countries. Beyond the Core In two distinct senses, our discussion goes beyond the material often covered in B-aditional introductory economics courses. First, we discuss many topical applications of the standard theoretical firamework. Here the intention is both to reinforce the material that has already been learned and to maintain the motivation for mastering theoretical analysis in order to apply it to relevant problems that people actually face today. In microeconomics we discuss human capital, discrimination, competition policy, the problems of industry, and the role of the government in resource allocation. In macroeconomics we examine practical difficulties in controlling the money supply, the relation between deficits, money and inflation, and the nature of unemployment. We show that the international dimension can completely alter the consequences of domestic policies. We have a whole section on the world economy. Second, we believe in introducing students immediately to the latest ideas in economics. If these can be conveyed simply, why force students to use traditional approaches in cases where we no longer believe them to be helpful or realistic? Thus in microeconomics we discuss signalling and education, moral haziu-d and insurance, and the modern analysis of cartels and OPEC. In macroeconomics we discuss information, new theories of unemployment, supply side economics, rational expectations, and theories of speculation and exchange rate determination. Economics for the Nineties Our aim is to allow students to understand the economic environment in the nineties. Most of our examples, apphcations, and extensions are drawn firom the real world. We equip students with the theoretical framework to understand today's discussion of tomorrow's problems. Among the issues we treat extensively are government deficits and inflation, the limits to Keynesian and monetarist economics, the prospects for xvii