Economics, 11th edition

1. Economics and Economies
   • Economics and Global Issues
   • The Core of Economics
   • Different Economic Systems
   • The Nature of Economic Reasoning

Boxes

• What's the Latest Economics News?
• Looking at Macroeconomic Data
• The Opportunity Costs of Studying
• Scarcity and Abundance
• Command Economies
• Adam Smith (1723-90)
• Ceteris Paribus

Part B FOUNDATIONS OF MICROECONOMICS

2. Supply and Demand
   • Demand
   • Supply
   • Price and Output Determination
   • Elasticity
   • The Time Dimension

Boxes

• UK House Prices
• Stock Market Prices
• Social Media Influencers and Their Effect on Demand Curves
• Any More Fares?
• *Using Calculus to Calculate the Price Elasticity Of Demand
• Digital Platforms
• Short Selling
• Dealing in Futures Markets

3. Government and the Market
   • The Control of Prices
   • Indirect Taxes and subsidies
   • Government Rejection of Market Allocation
   • Agriculture and Agricultural Policy

Boxes

• A Minimum Unit Price for Alcohol
• The Impact on Prices Of Natural Disasters/Health Crises
• How Can Ticket Touts Make So Much Money?
• Ashes To Ashes?
• The Fallacy of Composition

Part C MICROECONOMIC THEORY

4. Background to Demand: The Rational Consumer
   • Marginal utility theory
   • *The timing of costs and benefits
   • *Indifference analysis

Boxes

• *Using Calculus to Derive a Marginal Utility Function
• The Marginal Utility Revolution: Jevons, Menger, Walras
• Taking Account of Time
• *Cash Versus Vouchers
• *Giffen Goods Versus Giffen Behaviour
• *Consumer Theory: A Further Approach

5. Consumer Behaviour in an Uncertain World
   • Demand under conditions of risk and uncertainty
   • Behavioural economics

Boxes

• Experimental Economics
• *the Endowment Effect
• The Best Made Plans
• *A Simple Experiment to Test For Social Preferences
• Nudging People

6. Background to Supply
   • The Short-Run Theory of Production
   • Costs in the Short Run
   • The Long-Run Theory of Production
   • Costs in the Long Run
   • Revenue
   • Profit Maximisation

Boxes

• Malthus and the Dismal Science of Economics
• Diminishing Returns in The Bread Shop
• The Relationship Between Averages and Marginals
• *The Relationship Between TPP, MPP and APP
• The Fallacy of Using Historic Costs
• Are Fixed Costs Always the Same as Sunk Costs?
• Cost Curves in Practice
• *The Cobb-Douglas Production Function
• Minimum Efficient Scale
• *Using Calculus to Find the Maximum Profit Output
• The Logic of Logistics

7. Profit Maximising under Perfect Competition and Monopoly
   • Alternative Market Structures
   • Perfect Competition
   • Monopoly
   • The Theory of Contestable Markets

Boxes

• Concentration Ratios
• Is Perfect Best?
• E-Commerce and Market Structure
• Google: A Monopoly Abusing Its Market Power?
• X Inefficiency
• Cut-Throat Competition
• Airline Deregulation in The USA And Europe

8. Profit Maximising under Imperfect Competition
   • Monopolistic Competition
   • Oligopoly
   • Game Theory
   • Price Discrimination

Boxes

• Selling Ice Cream as A Student
• Declining Levels of Competition
• OPEC
• Buying Power
• The Prisoner's Dilemma
• What's The Train Fare to London?
• Personalised Pricing in Digital Markets
• Just the Ticket?

9. The Behaviour of Firms
   • Problems With Traditional Theory
   • Behavioural Economics of the Firm
   • Alternative Maximising Theories
   • Asymmetric Information and the Principal Agent Problem
   • Multiple Aims
   • Pricing in Practice

Boxes

• What Do You Maximise?
• How Firms Increase Profits by Understanding Irrational Consumers
• Constraints On Firms Pricing
• When Is a Theory Not a Theory?
• Merger Activity
• Stakeholder Power?
• How Do Companies Set Prices?

10. The Theory of Distribution of Income
    • Wage Determination Under Perfect Competition
    • Wage Determination in Imperfect Markets
    • Capital and Profit
    • Land and Rent

Boxes

• Labour As a Factor of Production
• *Using Indifference Curve Analysis to Derive the Individuals Supply Curve of Labour
• Immigration and the UK Labour Market
• Life at the Mill
• The Rise and Decline of The Labour Movement In The UK
• How Useful Is Marginal Productivity Theory?
• The Persistent Gender Pay Gap?
• Flexible Labour Markets and the Flexible Firm
• Behaviour at Work
• Stocks snd Flows
• The Economics of Non-Renewable Resources

Part D MICROECONOMIC POLICY

11. Inequality, Poverty and Policies to Redistribute Income
    • Inequality and Poverty
    • Taxes, Benefits, and the Redistribution of Income

Boxes

• Poverty in the Past
• Minimum Wage Legislation
• The Laffer Curve
• *Tax Cuts and Incentives
• Replacing tax Credits with Universal Credit
• What the Future Holds

12. Markets, Efficiency, and the Public Interest
    • Efficiency Under Perfect Competition
    • The Case for Government Intervention
    • Forms of Government Intervention
    • *Cost/Benefit Analysis
    • Government Failure and the Case for the Market

Boxes

• The Market for Vaccines
• The Police as a Public Service
• Should Health-Care Provision Be Left to The Market?
• Deadweight Loss from Taxes on Goods and Services
• *What Price a Human Life?
• *HS2: Is it Really Worth It?
• Mises, Hayek, and The Mont Pelerin Society

13. Environmental Policy
    • Economics of the Environment
    • Policies to Tackle Pollution and its Effects
    • The Economics of Traffic Congestion
    • Urban Transport Policies

Boxes

• The Economics of Biodiversity
• Green Taxes
• Placing A Price on CO2 emissions
• International Co-Ordination on Climate Change
• Trading Our Way Out of Climate Change
• Road Pricing in Singapore

14. Government Policy towards Business
    • Competition Policy
    • Privatisation and Regulation

Boxes

• Fixing Prices at Mini-Golf Meetings?
• Expensive Chips?
• Ticketing Takeovers
• Selling Power to the People

Part E FOUNDATIONS OF MACROECONOMICS

15. An Introduction to Macroeconomic Issues and Ideas
    • An Overview of Key Macroeconomic Issues
    • Measuring National Income and Output
    • The Business Cycle
    • The Circular Flow of Income
    • Unemployment
    • Inflation
    • The Open Economy

Appendix: Calculating GDP

Boxes

• Which Country is Better Off?
• Can GDP Measure National Happiness?
• Output Gaps
• The Costs of Unemployment
• The Costs of Inflation
• The Phillips Curve
• Dealing In Foreign Exchange

16. The Development of Macroeconomic Thinking: a Historical Perspective
    • The Macroeconomic Environment and Debates
    • Classical Macroeconomics
    • The Keynesian Revolution
    • The Rise of The Monetarist and New Classical Schools
    • The Keynesian Response
    • An Emerging Consensus Up to The Crisis Of 2008
    • The Financial Crisis and The Covid-19 Pandemic

Boxes

• Balance the Budget at all Costs
• The Crowding-Out Effect
• Will Wage Cuts Cure Unemployment?
• Menu Costs
• The Paradox of Thrift

Part F MACROECONOMIC MODELS, THEORIES AND POLICY

17. Short-Run Macroeconomic Equilibrium
    • Background To the Theory
    • The Determination of National Income
    • The Simple Keynesian Analysis of Unemployment and Inflation
    • The Keynesian Analysis of The Business Cycle

Boxes

• *Using Calculus to Derive the MPC
• Confidence and Spending
• Deriving the Multiplier Formula
• Allowing for Inflation in the 45°- Line Diagram
• Has There Been an Accelerator Effect in the UK?
• Balance Sheets and the Business Cycle

18. Banking, Money, and Interest Rates
    • The Meaning and Functions of Money
    • The Financial System
    • The Supply of Money
    • The Demand for Money
    • Equilibrium

Boxes

• Money Supply, National Income and National Wealth
• the Growth of Banks Balance Sheets
• The Rise of Securitisation
• UK and Eurozone Monetary Aggregates
• *Calculating the Money Multiplier

19. The Relationship between the Money and Goods Markets
    • The Effects of Monetary Changes on National Income
    • The Monetary Effects of Changes in The Goods Market
    • Modelling The Interaction of Monetary Policy And The Goods Market
    • Credit Cycles and The Goods Market

Appendix: The IS/LM Model

Boxes

• Choosing the Exchange Rate or the Money Supply
• Party Games and the Velocity of Money
• The Stability of the Velocity of Circulation
• Crowding out in an Open Economy
• Amplifiers and Economic Shocks

20. Aggregate Supply, Inflation and Unemployment
    • The AD/AS model
    • AD/AS and Inflation
    • Aggregate Demand and Supply with Inflation Targeting: The DAD/DAS model
    • The Labour Market and Aggregate Supply
    •  AD/AS and Macroeconomic Controversies

Boxes

• The Aggregate Demand Curve
• Cost-Push Inflation and Supply Shocks
• Analysing Demand-Pull and Cost-Push Inflation Using the DAD/DAS model
• Common Ground Between Economists?

21. The Relationship between Inflation, Unemployment and Output
    • The EAPC and the Inflation/Unemployment Relationship
    • Inflation and Unemployment: The Monetarist Perspective
    • Inflation and Unemployment: The New Classical Position
    • Inflation and Unemployment: The Modern Keynesian Position
    • Central Banks and Inflation Targeting
    • Central Banks, Economic Shocks and the Macroeconomy: An Integrated Model

Boxes

• *Basing Expectations on the Past
• The Accelerationist Hypothesis
• The Rational Expectations Revolution
• Forecasting the Weather
• The boy who Cried Wolf
• *A Model of Inflation Bias
• Inflation Targeting

22. Fiscal and Monetary Policy
    • Fiscal policy and the public finances
    • The use of fiscal policy
    • Monetary policy
    • The policy-making environment

Boxes

• COVID, Crises and Public Sector Spending
• The Fiscal Impulse
• Riding a Switchback
• The Evolution of the Stability and Growth Pact
• The Operation of Monetary Policy in the UK
• Central Banking and Monetary Policy in the USA
• Quantitative Easing
• Monetary Policy in the Eurozone
• Goodhart's Law
• Using Interest Rates to Control Both Aggregate Demand and the Exchange Rate

23. Long-term Economic Growth and Supply-side Policies
    • Introduction to Long-Term Economic Growth
    • Economic Growth Without Technological Progress
    • Economic Growth with Technological Progress
    • Approaches To Supply-Side Policy
    • Supply-Side Policies in Practice: Market-Orientated Policies
    • Supply-Side Policies in Practice: Interventionist Policies

Boxes

• Labour Productivity
• Getting Intensive with Capital
• UK Human Capital
• The Supply-Side Revolution in the USA
• A Modern Approach to Industrial Policy

Part G THE WORLD ECONOMY

24.  International Trade
    • The Advantages of Trade
    • Arguments for Restricting Trade
    • Preferential Trading
    • The European Union
    • The UK and Brexit

Boxes

• Trading Places
• Sharing Out the Jobs
• Trade as Exploitation?
• Free Trade and the Environment
• Strategic Trade Theory
• *The Optimum Tariff or Export Tax
• Giving Trade a Bad Name
• The Doha Development Agenda
• Mutual Recognition: The Cassis De Dijon Case
• Features of the Single Market

25. The Balance of Payments and Exchange Rates
    • Alternative Exchange Rate Regimes
    • Fixed Exchange Rates
    • Free-Floating Exchange Rates
    • Exchange Rate Systems in Practice

*Appendix: The Open Economy and IS/LM analysis

Boxes

• The Balance of Trade and the Public-Sector Budget Balance
• The UK’s Balance of Payments Deficit
• The Effectiveness of Fiscal and Monetary Policies Under Fixed Exchange Rates
• The Price of a Big Mac
• The Euro/Dollar Seesaw
• The Effectiveness of Monetary and Fiscal Policies Under Floating Exchange Rates
• Sterling Since the 1990s
• Do Inflation Rates Explain Longer-Term Exchange Rate Movements?

26. Economies in an Interdependent World
    • Globalisation And the Problem of Instability
    • European Economic and Monetary Union (EMU)
    • Global Inequality
    • Trade and Developing Countries
    • The Problem of Debt

Boxes

• Economic and Financial Interdependencies: Trade Imbalance in The US And China
• Optimal Currency Areas
• The Human Development Index (HDI)
• When Driving and Alcohol do Mix
• The Evolving Comparative Advantage of China
• A Debt to the Planet

Postscript: Reality Island

Appendix 1:Some Techniques of Economic Analysis

Appendix 2: Websites

Threshold Concepts and Key Ideas

Glossary