Economics

Preface p. XXIII Part 1 Introduction Chapter 1 The Motor Industry and Economics p. 1 The Motor Industry: A Brief History p. 2 Nationalization p. 6 Industrial Relations p. 7 The Extent of the Market p. 7 What is Economics? p. 8 Markets and Government in the Mixed Economy p. 11 Close-up: A Failed Alternative to the Mixed Economy p. 13 Microeconomics and Macroeconomics: the Two Branches of Economics p. 14 The Science of Economics p. 15 Why Economists Disagree p. 17 Close-up: Economists Agree!! p. 18 Consensus on the Importance of Scarcity p. 19 Review and Practice p. 19 Chapter 2 Basic Principles p. 22 The Basic Competitive Model p. 23 Prices, Property Rights, and Profits: Incentives and Information p. 25 Rationing p. 27 Opportunity Sets p. 27 Cost p. 32 Close-up: Opportunity Costs of Meetings p. 33 Review and Practice p. 35 Appendix Reading Graphs p. 37 Chapter 3 Trade p. 41 The Benefits of Economic Interdependence p. 42 Trade Between Countries p. 43 Using Economics: Calculating the Gains from Trade p. 49 Close-up: What Does Britain Export and Import? p. 50 The Perceived Costs of International Interdependence p. 52 Policy Perspective: Free Trade p. 53 Review and Practice p. 55 Chapter 4 Demand, Supply, and Price p. 57 The Role of Prices p. 58 Demand p. 59 Supply p. 64 Policy Perspective: Stabilising Farm Incomes and Stabilising Agricultural Prices p. 65 Using Economics: The Late 1980s Boom in House Prices p. 66 Law of Supply and Demand p. 71 Close-up: The Structure of Economic Models p. 72 Price, Value, and Cost p. 74 Review and Practice p. 75 Chapter 5 Using Demand and Supply p. 78 Sensitivity to Price Changes: the Price Elasticity of Demand p. 79 The Determinants of the Elasticity of Demand p. 84 The Price Elasticity of Supply p. 85 Using Demand and Supply Elasticities p. 88 Shortages and Surpluses p. 90 Interfering with the Law of Supply and Demand p. 91 Policy Perspective: Tax Competition and Cross-Border Shopping p. 92 Close-up: Interfering with the Market for Housing p. 94 Review and Practice p. 96 Chapter 6 Time and Risk p. 99 Interest p. 100 Using Economics: The Effects of Compound Interest p. 101 The Market for Loanable Funds p. 102 Inflation and the Real Rate of Interest p. 103 The Market for Assets p. 104 The Market for Risk p. 106 Close-up: The Lloyd's Insurance Market p. 108 Policy Perspective: Should the National Health Service Treat Smokers? p. 110 Entrepreneurship p. 111 An Overview of Financial Markets p. 112 Review and Practice p. 112 Appendix Calculating Present Discounted Value p. 114 Chapter 7 The Public Sector p. 115 The Changing Role of Government p. 116 Adam Smith's "Invisible Hand" and the Central Role of Markets p. 120 Government and Ignorance of Economics p. 120 Close-up: Adam Smith--Founder of Modern Economics p. 121 Government and Redistribution p. 121 Government and Market Failures p. 122 Using Economics: Dealing with Externalities p. 125 Government's Options p. 128 Policy Perspective: Public Provision of Pensions p. 129 Close-up: International Perspectives p. 130 Government Failures p. 131 Review and Practice p. 133 Part 2 Perfect Markets Chapter 8 The Consumption Decision p. 137 The Basic Problem of Consumer Choice p. 138 A Closer Look at the Demand Curve p. 142 Policy Perspective: Calculating Tax Revenues p. 143 Close-up: International Price and Income Elasticities for Food p. 144 Using Economics: Environmental Taxes p. 146 Utility and the Description of Preferences p. 147 Looking Beyond the Basic Model: How Well do the Underlying Assumptions Match Reality? p. 151 Review and Practice p. 152 Appendix Indifference Curves and the Consumption Decision p. 154 Chapter 9 Labour Supply and Savings p. 161 The Labour Supply Decision p. 162 Close-up: The "Rational" Couple's Debate p. 164 Policy Perspective: Growth of Female Participation in the Labour Force p. 168 Human Capital and Education p. 169 Budget Constraints and Savings p. 172 Close-up: Why Are Savings in Britain So Low? p. 175 Review and Practice p. 176 Appendix Indifference Curves and the Labour Supply and Savings Decisions p. 178 Chapter 10 The Firm's Costs p. 182 Profits, Costs, and Factors of Production p. 183 Short-run and Long-run Cost Curves p. 195 Using Economics: Economies of Scale and the Structure of Industries p. 197 Looking Beyond the Basic Model: Cost Curves and the Competitiveness of Markets p. 199 Close-up: How Big is Big Industry? p. 200 Economies of Scope p. 201 Review and Practice p. 202 Appendix Cost Minimization with Many Inputs p. 204 Chapter 11 Production p. 210 Revenue p. 211 Costs p. 211 Basic Conditions of Competitive Supply p. 213 Entry, Exit, and Market Supply p. 215 Close-up: Entering the Painting Business p. 216 Long-run Versus Short-run Supply p. 219 Accounting Profits and Economic Profits p. 222 Close-up: Sunk Costs, Contestability, and the Channel Tunnel p. 224 Factor Demand p. 225 Close-up: The Fall and Rise of the Railways p. 229 Review and Practice p. 230 Appendix Alternative Ways of Calculating the Demand for Labour p. 232 Chapter 12 Competitive Equilibrium p. 233 General Equilibrium Analysis p. 234 The Basic Competitive Equilibrium Model p. 236 The Circular Flow of Funds p. 238 Competitive General Equilibrium and Economic Efficiency p. 240 Close-up: Pareto Improvement in the Skies p. 242 Looking Beyond the Basic Model: Market Failures and the Role of Government p. 243 Review and Practice p. 245 Appendix Pareto Efficiency and Competitive Markets p. 246 Part 3 Imperfect Markets Chapter 13 Monopolies and Imperfect Competition p. 249 Market Structures p. 250 Monopoly Output p. 251 Close-up: The Soviet Legacy of Monopoly Power p. 257 Imperfect Competition p. 258 Close-up: Is Xerox the Same as Photocopy? p. 261 Barriers to Entry: Why is Competition Limited? p. 262 Equilibrium with Monopolistic Competition p. 266 Schumpeterian Competition p. 267 Close-up: IBM--From the Edge of Monopoly to the Edge of Competition p. 268 Review and Practice p. 268 Appendix A Monopsony p. 270 Appendix B Demand for Inputs Under Monopoly and Imperfect Competition p. 270 Chapter 14 Oligopolies p. 272 Collusion p. 273 Game Theory: The Prisoner's Dilemma p. 276 Restrictive Practices p. 277 The Many Dimensions of Competition Among Oligopolists p. 279 Price and Output Competition p. 279 Close-up: Off Their Trolleys--The British and Supermarkets p. 280 Review and Practice p. 282 Appendix Describing the Market Equilibrium for Oligopoly p. 284 Chapter 15 Government Policies Towards Competition p. 287 The Drawbacks of Monopolies and Limited Competition p. 288 Policies Towards Natural Monopolies p. 291 Government Policies page.