nach oben

2014 | Buch

Kapitel lesen Erstes Kapitel lesen

Microeconomics

A Fresh Start

verfasst von: Peter Dorman

Verlag: Springer Berlin Heidelberg

Buchreihe : Springer Texts in Business and Economics

Enthalten in: Springer Professional "Wirtschaft+Technik" , Springer Professional "Wirtschaft"

Einloggen, um Zugang zu erhalten

Über dieses Buch

The world has changed dramatically in recent years and so has the field of economics, but many introductory economics textbooks have remained stuck in the past. This book provides a new beginning for the study of microeconomics, emphasizing current debates and research trends. It is international in outlook and reflects the shift toward empirical methods, as well as the study of institutions and economic behavior. It is also written to fit in with an approach to teaching based on active learning and critical thinking. Mainstream material is still covered, but within a new context, making it more relevant, realistic and responsive to the deeper questions economists are now asking about theory and policy. Economics as a discipline is viewed from a broad perspective that takes into account new developments at the intersections with psychology, political science, the natural sciences and philosophy. Economics as presented in this text is less sure that it has all the answers, but it is more interesting, application-oriented and open to new ideas.

Inhaltsverzeichnis

Frontmatter

Foundations

Frontmatter

1. Economics and the Economy

Abstract

It would not be easy to avoid all discussion of economics in twenty-first century America. You would have to keep your distance from television, radio and newspapers, not to mention casual conversations on the job, over a beer, or at a family gathering. In fact, our society is saturated with economics, reflecting the great power that economic events have over our lives, even though the forces that produce them are often mysterious. Economics is like the weather, only more so: all around us, obviously important, subject to prediction but only slightly to control.

Peter Dorman

2. Economics Yesterday and Today

Abstract

As we have just seen, economics is not just an open-ended study of the economy, nor is it simply a collection of ideas and tools. It is an enterprise, with its own particular history, structure and values. We have sketched some of this very briefly, but we need to consider the economics enterprise in more depth before beginning the actual study of economics. After all, it is the deeper purposes of economic analysis that give meaning to the various definitions and models we will examine, and these purposes are the product of many generations of teachers, writers and researchers, each building on or reacting to the experiences of their predecessors. What economic ideas mean cannot be separated from what they mean to those who develop and use them.

Peter Dorman

3. Four Building Blocks of Economic Theory

Abstract

Economics is not sociology, psychology or politics, but it relies on assumptions about society, mental and emotional processes, and the political and legal environment. Until recently, however, these assumptions didn’t come from the other disciplines which take them as their fields of study; instead, they were largely inherited from the eighteenth century worldview out of which Adam Smith and his followers fashioned their early renditions of economic theory. That is to say, they reflected the prejudices of the Enlightenment in England around the time of the American revolution. They are rationalist, individualist and concerned with subduing nature for the greater benefit of civilization. In this chapter we will look carefully at several of the most important conceptual building blocks, explaining exactly how they appear in modern economics and subjecting them to critical scrutiny.

Peter Dorman

4. Values and Objectives

Abstract

In the previous chapter we looked at several key elements of the framework used by economists to do positive analysis—explanation of the past and prediction of the future. Now we will sketch the framework for normative analysis. The central concept is economic efficiency. We will begin by taking a bird’s-eye view of the topic and then move up close to study in some detail its underlying components, economic costs and benefits. These ideas are not complicated, but they differ subtly but significantly from the everyday use of the same words. It’s important to remove any potential sources of confusion before moving to the model-building that lies ahead.

Peter Dorman

5. Analyzing Markets

Abstract

Mohammed Ali Idris is a coffee grower from Ethiopia. Interviewed in 2002, he had this to say about what was happening to his livelihood and life as a result of changes in the coffee market:

Peter Dorman

6. Markets and Human Well-Being

Abstract

The preceding chapter was almost entirely about positive economics: how markets work, and how the apparatus of supply and demand analysis can be used to explain economic outcomes or predict how future events may alter the fortunes of individuals and groups tied to the economic system. This is economics as plumbing or dentistry—no values to speak of, just technique. But the great interest most of us have in economic issues is not just technical. We care about meeting human needs, improving living standards and pursuing other goals like liberty, equality and sustainability. This means that we care deeply about the normative side of economics, what it can tell us about whether economic arrangements are good. So this chapter is an introduction to normative models in economics, the foundation for thinking analytically about the desirability of economic institutions and policies.

Peter Dorman

Institutions

Frontmatter

7. Markets

Abstract

There is a tendency among economists to refer to “the market” as if it were like a clock. You can find all sorts of clocks, running on different kinds of power, analog or digital, mounted on walls or on your wrist, with different numbering styles and decorations, but in the end they are all just clocks. They tell you what time it is on a 12 or 24 h cycle. If you need this basic information, any clock will do.

Peter Dorman

8. Firms

Abstract

The United States, Europe and Japan are often said to possess market economies, implying that the role played by markets is the most important characteristic they have in common. This may be true, yet one could just as well call them corporate economies, for their large-scale business organization is arguably no less important. These are the engines of productivity, and they also define the landscapes of wealth and economic power.

Peter Dorman

9. Government

Abstract

Government is a referee who also plays the game. It is government courts, agencies and legislatures that set the rules by which the economy operates, but governments are also major economic players in their own right. They own and operate businesses and generate and spend vast amounts of income; in fact, in every economy the government (pulling together all its levels and branches) is by far the largest single economic entity.

Peter Dorman

10. Civil Society

Abstract

“There is no such thing as societies, only individuals and their families,” said former British Prime Minister Margaret Thatcher. Most social scientists would disagree; for them the importance of the myriad ways people come together in society is obvious. (One type of way, incidentally, is through families.) In any practical discussion of economic policy, social institutions are likely to play a significant role. Whether the groups in question are religious denominations, unions, human rights or environmental advocacy organizations or some other group of people with a purpose, their impact has to be taken into account.

Peter Dorman

A Closer Look at Markets

Frontmatter

11. The Theory of Demand

Abstract

In Chap. 4 we saw that, according to the traditional economic worldview, the sole purpose of economic life is to produce goods for purchase by consumers. Producing the right goods in the right amounts, with the characteristics consumers desire, is what an efficient economy should be doing as much of the time as possible. Clearly, in order to translate this broad objective into specific policies we require a theory of the consumers themselves: what governs the choices they make and how their individual decisions in the marketplace affect their ultimate well-being.

Peter Dorman

12. Production Costs and the Theory of Supply

Abstract

At the beginning of Chap. 11 it was noted that the utility-based theory of demand is not really a theory that tells us much about consumer choice; its real function is to disentangle the assumptions necessary to support the first condition of the Market Welfare Model, that the demand curve represents the marginal benefits to society. The situation on the supply side is a bit different, however. While the main function of the analysis of production costs is to do for the supply curve what utility theory does for the demand curve, the cost theory we will look at in this chapter is a genuinely useful tool for studying issues of technology and the organization of production.

Peter Dorman

13. Monopoly Power

Abstract

Up to now, the dimension of power has been missing from our analysis. We have imagined an economic world in which individuals and organizations compete for their advantage, but their choices have all been about themselves—how to produce more efficiently, what to purchase, and so on. Now we take the next step and consider situations in which competitors act strategically to dominate or exploit others. We will do this using two models, one portraying the power to control prices in order to gain higher profits, the other the power that results from having a superior bargaining position. The first will be taken up in this chapter, and bargaining will be examined in Chap. 14. Taken together, they provide the beginning of an explanation of how a system based on free choice in the marketplace can result in concentrations of wealth and power.

Peter Dorman

14. The Economics of Bargaining Power

Abstract

In Chap. 5 we visited the troubled world of coffee, where growers are suffering from declining incomes and the economies of whole countries are at risk. We saw that prices fell after a supply management system was ended in 1989, and that recent increases in production capacity, combined with inelastic demand, has caused the bottom to fall out of the market. This gave us an example of the power of supply and demand analysis to explain important developments in economic and social life.

Peter Dorman

15. Market Failure

Abstract

There’s a joke that goes something like this: how many economists does it take to screw in a light bulb? Answer: none, the invisible hand will take care of it.

Peter Dorman

Microeconomic Challenges

Frontmatter

16. Labor and Employment

Abstract

For most of us, there is no aspect of economics more important than the study of employment, wages and the conditions of work—for the simple reason that most of us participate in the economy as workers or plan to participate that way in the future. As we saw in Chap. 4, the perspective of economics puts consumption at the center, but for almost everyone work is what makes consumption possible, and useful and interesting work is valuable in its own right. In this chapter we will survey the concepts economists employ when they try to explain or predict wages and job opportunities.

Peter Dorman

17. Financial Markets

Abstract

For many people, the financial markets, where stocks and bonds are traded, are the most visible aspects of the economy. When you hear the phrase “economic news” on TV or read it in a newspaper, there is a good chance that you are about to find out about the latest gyrations in stock prices and interest rates.

Peter Dorman

18. Inequality

Abstract

In the museum of the Louvre, in Paris, sits “The Raft of the Medusa”, one of the most celebrated paintings of the nineteenth century, the work of Theodore Gericault. Here it is, in reproduction (Fig. 18.1):

Peter Dorman

19. Poverty

Abstract

As a very first approximation, we could consider the average lifespan of a population to be an indicator of how far it has risen from poverty and economic deprivation. Of course, many things affect how long people can expect to live, such as war, epidemics and natural disasters, but throughout history there has been a rough correlation between longevity and prosperity.

Peter Dorman

20. Economics and Ecology

Abstract

Whole classes of animals are mysteriously declining in population and possibly headed to extinction. Take frogs, for example. The Global Amphibian Assessment found in 2004 that, due to mass die-offs and loss of habitat, about a third of all species of frogs, toads and salamanders could soon disappear. That the problem could be worldwide, affecting these creatures in Canada and Madagascar, is particularly disturbing. Recent evidence points to an outbreak of skin fungus as an important factor, itself possibly linked to global climate change, but researchers admit the problem—if it is one problem and not a combination of many problems—is still only dimly understood.

Peter Dorman

21. Markets as Systems

Abstract

In the first few chapters of this book we presented the fundamental question modern economics was created to answer: can the awesome power unleashed by the industrial revolution be left to the push and pull of the marketplace, or does it need to be steered by the conscious intervention of government or some other institution acting on behalf of society? Adam Smith thought that markets could do most of the job on their own, and subsequent generations of economists have struggled to identify the precise conditions under which Smith’s Invisible Hand could be expected to function. Much of what they discovered has been summarized in the Market Welfare Model and the many adjustments and caveats we have examined in our tour of microeconomics.

Peter Dorman

Backmatter

Titel: Microeconomics
verfasst von: Peter Dorman
Verlag: Springer Berlin Heidelberg
Electronic ISBN: 978-3-642-37434-0
Print ISBN: 978-3-642-37433-3
DOI: https://doi.org/10.1007/978-3-642-37434-0