economics - verbundzentrale des · pdf fileeconomics 9th edition david begg stanley fischer...

economics9th edition

David BeggStanley Fischer

Rudiger Dornbusch

MeGrawHill

McGraw-HillHigher Education

London Boston Burr Ridge, IL Dubuque, IA Madison, WI New York San FranciscoSt. Louis Bangkok Bogota Caracas Kuala Lumpur Lisbon Madrid Mexico City Milan

Montreal New Delhi Santiago Seoul Singapore Sydney Taipei Toronto

Detailed Table of Contents

Preface xiii

Guided tour xvi

Technology to enhance learning and teaching xviii

Acknowledgements for the ninth edition xxi

About the lead author

PART ONE Introduction1 Economics and the economy

1.1 Econonomic issues1.2:, Scarcity and the competing use

of resources1.3 The role of the market1.4 Positive and normative1.5 Micro and macro

SummaryReview questions

2 Tools of economic analysis2.1 Economic data2.2 Index numbers2.3 Nominal and real variables2.4 Measuring changes in economic

variables2.5 Economic models2.6 Models and data2.7 Diagrams, lines and equations2.8 Another look at other things

equal'2.9 Theories and evidence2.10 Some popular criticisms of

economics and economistsSummaryReview questions

3 Demand, supply and the market3.1 The market3.2 Demand, supply and equilibrium3.3 Demand and supply curves3.4 Behind the demand curve3.5 Shifts in the demand curve3.6 Behind the supply curve3.7 Shifts in the supply curve

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89

12141616

18192022

24242526

3030

313435

3737383940424345

3.8 Free markets and price controls 453.9 What, how and for whom 48

Summary 50Review questions 51

PART TWO Positive microeconomics4 Elasticities of demand and supply 55

4.1 The price responsiveness ofdemand 55

4.2 Price, quantity demanded andtotal expenditure 60

4.3 Further applications of the priceelasticity of demand 62

4.4 Short run and long run 644.5 The cross-price elasticity of

demand 644.6 The effect of income on demand 654.7 Inflation and demand 684.8 Elasticity of supply 684.9 Who really pays the tax? 70


5 Consumer choice and demanddecisions 755.1 Demand by a single consumer 755.2 Adjustment to income changes 835.3 Adjustment to price changes 845.4 The market demand curve 905.5 Complements and substitutes 915.6 Transfers in kind 91

Summary 93Review questions 94Appendix: Consumer choicewith measurable utility 95

6 Introducing supply decisions 986.1 Business organization 986.2 A firms accounts 996.3 Firms and profit maximization 1036.4 Corporate finance and corporate

control 1046.5 The firm's supply decision 105

vn

Detailed Table of Contents Continued

6.6 Marginal cost and marginalrevenue 108

6.7 Marginal cost and marginalrevenue curves 112Summary 116Review questions 116

7 Costs and supply 1187.1 Input and output 1187.2 Costs and the choice of technique 1207.3 Long-run total, marginal and

average costs 1217.4 Returns to scale 1227.5 Average cost and marginal cost 1277.6 The firms long-run output

decision 1287.7 Short-run costs and diminishing

marginal returns 1287.8 A firm's output decision in the

short run7.9 Short-run and long-run costs


8 Perfect competition and puremonopoly8.1 Perfect competition8.2 A perfectly competitive firm's

supply decision8.3 Industry supply curves8.4 Comparative statics for a

competitive industry8.5 Global competition8.6 Pure monopoly: the opposite

limiting case8.7 Profit-maximizing output for a

monopolist8.8 Output and price under monopoly

and competition8.9 A monopoly has no supply curve8.10 Monopoly and technical change


9 Market structure and imperfectcompetition 1649.1 Why market structures differ 1659.2 Monopolistic competition 1699.3 Oligopoly and interdependence 1709.4 Game theory and interdependent

decisions 1739.5 Reaction functions 1769.6 Entry and potential competition 1809.7 Strategic entry deterrence 1819.8 Summing up 184


10 The labour market 18810.1 The firm's demand for factors in

the long run 18910.2 The firm's demand for labour in

the short run 19110.3 The industry demand curve for

134136137138

140141

142145

148150

1 5 "71DZ

1 53

155157160162163

labour10.4 The supply of labour10.5 Industry labour market

equilibrium10.6 Transfer earnings and economic

rents10.7 Do labour markets clear?10.8 UK wages and employment

SummaryReview questionsAppendix: Isoquants and thechoice of production technique

11 Different types of labour11.1 Productivity differences11.2 Discrimination11.3 Trade unions


12 Factor markets and incomedistribution12.1 Physical capital12.2 Rentals, interest rates and asset

prices

195196

201

202204207208209

211

214216222225231232

233234

235


12.3 Saving, investment and the realinterest rate 241

12.4 The demand for capital services 24212.5 The supply of capital services 24312.6 Equilibrium and adjustment

in the market for capitalservices 245

12.7 The price of capital assets 24612.8 Land and rents 24712.9 Income distribution in the UK 248

Summary 251Review questions 252Appendix: The simple algebra ofpresent values and discounting 254

13 Risk and information 25513.1 Individual attitudes to risk 25513.2 Insurance and risk 25813.3 Uncertainty and asset returns 26013.4 Portfolio selection 26213.5 Efficient asset markets 26713.6 More on risk 271


14 The information economy 27614.1 E-products 27614.2 Consuming information 27814.3 Distributors of information 28214.4 Setting standards 28614.5 Recap 28714.6 Boom and bust of the dotcom

companies 287Summary 291Review questions 292

PART THREE Welfare economics15 Welfare economics 295

15.1 Equity and efficiency 29615.2 Perfect competition and Pareto

efficiency 29715.3 Distortions and the second best 30015.4 Market failure 30215.5 Externalities 303

15.6 Environmental issues15.7 Other missing markets: time and

risk15.8 Quality, health and safety

SummaryReview questionsPostscript: Economics in action:climate change

16 Government spending and revenue16.1 Taxation and government

spending16.2 The government in the market

economy16.3 The principles of taxation16.4 Taxation and supply-side

economics16.5 Local government16.6 Economic sovereignty16.7 Political economy: how

governments decideSummaryReview questions

17 Industrial policy and competitionpolicy17.1 Industrial policy17.2 Economic geography17.3 The social cost of monopoly

power1 7.4 Competition policy17.5 Mergers


18 Natural monopoly: public or private?18.1 Natural monopoly18.2 Nationalized industries18.3 Public versus private18.4 Privatization in practice18.5 Regulating private monopolies18.6 The Private Finance Initiative


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357358359364366367369372373

rx


PART FOUR Macroeconomics19 Introduction to macroeconomics 377

19.1 The big issues 37819.2 The facts 37819.3 An overview 37919.4 National income accounting 38119.5 What GNP measures 389


20 Output and aggregate demand 39720.1 Components of aggregate

demand 39920.2 Aggregate demand 40220.3 Equilibrium output 40220.4 Another approach: planned

saving equals planned investment 40420.5 A fall in aggregate demand 40520.6 The multiplier 40720.7 The paradox of thrift 408


21 Fiscal policy and foreign trade 41221.1 Government and the circular

flow 41321.2 The government and aggregate

demand 41421.3 The government budget 41821.4 Deficits and the fiscal stance 42021.5 Automatic stabilizers and

discretionary fiscal policy 42121.6 The national debt and the

deficit 42221.7 Foreign trade and income

determination 425Summary 429Review questions 430

22 Money and banking 43222.1 Money and its functions 43222.2 Modern banking 43422.3 How banks create money 437

22.4 The monetary base and the moneymultiplier 439

22.5 Measures of money 44122.6 Competition between banks 44222.7 The demand for money 443


23 Interest rates and monetarytransmission 45023.1 The Bank of England 45023.2 The Bank and the money supply 45123.3 Lender of last resort 45323.4 Equilibrium in financial

markets 45423.5 Monetary control 45723.6 Targets and instruments of

monetary policy 45823.7 The transmission mechanism 459


24 Monetary and fiscal policy 46824.1 Monetary policy rules 46824.2 The JS-LM model 47024.3 The IS-LM model in action 47224.4 Shocks to money demand - 47424.5 The policy mix 47424.6 The effect of future taxes 47524.7 Demand management revisited 478


25 Aggregate supply, prices andadjustment to shocks 48125.1 Inflation and aggregate demand 48225.2 Aggregate supply 48425.3 Equilibrium inflation 48525.4 The labour market and wage

behaviour 48925.5 Short-run aggregate supply 49025.6 The adjustment process 49125.7 Sluggish adjustment to shocks 49425.8 Trade-offs in monetary objectives 496


26

27

28

29


Inflation, expectations and credibility26.126.226.326.4

26.526.626.7

Money and inflationInflation and interest ratesInflation, money and deficitsInflation, unemployment andoutputThe costss of inflationDefeating inflationThe Monetary Policy CommitteeSummaryReview questions

Unemployment27.127.227.3

27.4

27.5

The labour marketAnalysing unemploymentExplaining changes inunemploymentCyclical fluctuations inunemploymentThe cost of unemploymentSummaryReview questions

Exchange rates and the balance ofpayments28.128.228.328.428.5

28.628.728.8

Open29.1

The foreign exchange marketExchange rate regimesThe balance of paymentsThe real exchange rateDeterminants of the currentaccountThe financial accountInternal and external balanceThe long-run equilibrium realexchange rateSummaryReview questions

i economy macroeconomicsFixed exchange rates

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500501503505

507512515518521522

524525527

530

535536539540

541541544545548

549550552

553557558

560560

29.3 Devaluation 56529.4 Floating exchange rates 56729.5 Monetary and fiscal policy under

floating exchange rates 57129.6 The pound since 1980 573


30 Economic growth 57830.1 Economic growth 57930.2 Growth: an overview 58030.3 Technical knowledge 58230.4 Growth and accumulation 58430.5 Growth through technical progress 58730.6 Growth in the OECD 58730.7 Endogenous growth 59330.8 The costs of growth 594


31 Business cycles 59831.1 Trend and cycle: statistics or

economics? 59931.2 Theories of the business cycle 60031.3 Real business cycles 60531.4 An international business cycle? 60831.5 UK recovery after 1992 60931.6 Post-2001 609


32 Macroeconomics: taking stock 61332.1 Areas of disagreement 61332.2 New Classical macroeconomics 61832.3 Gradualist monetarists 62032.4 Moderate Keynesians 62132.5 Extreme Keynesians 62232.6 Summing up 624


29.2 Macroeconomic policy underfixed exchange rates 564

XI


PART FIVE The world economy33 International trade 631

33.1 Trade patterns 63233.2 Comparative advantage 63533.3 Intra-industry trade 64033.4 Gainers and losers 64233.5 The economics of tariffs 64333.6 Good and bad arguments for

tariffs 64533.7 Tariff levels: not so bad? 65033.8 Other trade policies 650


34 Exchange rate regimes 65534.1 The gold standard 65634.2 An adjustable peg 65834.3 Floating exchange rates 65934.4 Speculative attacks on pegged

exchange rates 66034.5 Fixed versus floating 66234.6 International policy co-ordination 66434.7 The European Monetary System 666


35 European integration 67235.1 The Single Market 67235.2 Benefits of the Single Market 67335.3 From EMS to EMU 67635.4 The economics of EMU 67835.5 Central and Eastern Europe 682


36 Poverty, development andglobalization 69136.1 World income distribution 69236.2 Obstacles to development 69236.3 Development through trade in

primary products 69436.4 Industrialization 69836.5 Borrowing to grow 69936.6 Aid 70436.7 Globalization 705


Appendix: Answers to review questions andActivity boxes 712

Glossary 739Index 751

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