Economics, Global Edition, 2nd

Economics, Global Edition, 2nd - Daron Acemoglu - 9781292214504 - Economics - Principles of Economics (101)
Series
Pearson
Author
Daron Acemoglu / David Laibson / John List  
Publisher
Pearson
Cover
Softcover
Edition
2
Language
English
Total pages
832
Pub.-date
August 2018
ISBN13
9781292214504
ISBN
1292214503
Related Titles



Description

Acemoglu, Laibson, List: An evidence-based approach to economics

Throughout Economics, 2nd Edition, authors Daron Acemoglu, David Laibson, and John List use real economic questions and data to help students learn about the world around them.

 

Taking a fresh approach, the authors use the themes of optimization, equilibrium, and empiricism to illustrate the power of simple economic ideas, and their ability to explain, predict, and improve what happens in the world. Each chapter begins with an empirical question that is later answered using data in the Evidence-Based Economics feature. As a result of the text’s practical emphasis, students learn to apply economic principles to guide the decisions they make in their own lives.

 

Pearson MyLabTM Economics not included. Students, if MyLab is a recommended/mandatory component of the course, please ask your instructor for the correct ISBN and course ID. MyLab should only be purchased when required by an instructor. Instructors, contact your Pearson rep for more information.


Pearson MyLab is an online homework, tutorial, and assessment product designed to personalize learning and improve results. With a wide range of interactive, engaging, and assignable activities, students are encouraged to actively learn and retain tough course concepts.

Features

This title is a Pearson Global Edition. The Editorial team at Pearson has worked closely with educators around the world to include content which is especially relevant to students outside the United States.

 

 

About the book

 

Teach economics through three unified themes

Three key principles--optimization, equilibrium, and empiricism--lie at the heart of the authors’ approach. Chapters 1 to 4 introduce these key themes, and lay the groundwork for understanding the economic way of thinking about the world.

  1. Optimization. The first principle—that people try to choose the best available option—is optimization. Economists believe that optimization explains most choices people make, including minor decisions like deciding whether to eat a cheeseburger, and major decisions like deciding whom to date or marry. When people fail to optimize perfectly, economic reasoning can be used to analyze the mistake and to suggest a better course of action.
  2. Equilibrium. Economic systems tend toward equilibrium, wherein each economic actor feels that he or she cannot do any better by picking another course of action. This principle highlights the connections among economic actors and their choices. In a state of equilibrium, consumers and purveyors of goods and services are simultaneously optimizing, and their behaviors are consequently intertwined.
  3. Empiricism. While the first two key principles are conceptual, the third is methodological. Economists use data to test economic theories, learn about the world, and speak to policymakers. The emphasis on matching theories with real-world data to answer specific questions helps to show students the evidence behind the theory, making economics concrete, interesting, and fun.

 

Showcase empirical questions with engaging features

·    Evidence-Based Economics (EBE) features show how economists use data to answer the question posed in the opening paragraph of each chapter. EBEs use actual data from field experiments, lab experiments, naturally occurring data, or government data, while highlighting major concepts in the chapter. These features let students get a real look at economics as it plays out in the world around them. Examples include:

o Is Facebook free?

o Why are you so much more prosperous than your great-great-grandparents were?

o Is College worth it?

o Are tropical and semitropical areas condemned to poverty by their geographies?

o Will free trade cause you to lose your job?

o What caused the recession of 2007-2009?

o Is there value in putting yourself into someone else’s shoes?

o Are companies like Nike harming workers in Vietnam?

o What is the optimal size for government?

·    Letting the Data Speak features reinforce the theme of evidence behind the theory. These short, targeted explorations analyze an economic question by using real data as the foundation of the discussion. Among the many issues explored:

o Should McDonald’s be interested in elasticities?

o Income inequality in the United States

o Fair trade products

o Life expectancy and innovation

o Do wages really go down if the labor supply increases?

o Managing expectations

o Why do some firms advertise and others don’t?

·    Choice and Consequence features emphasize optimization—one of the key themes in the book—by focusing on making the best decision. These features ask students to make an economic decision, or evaluate the consequences of past real decisions. The authors then explain how an economist might analyze the same decision. Examples of choices investigated:

o Do people really optimize?

o The power of growth

o The unintended consequences of fixing market prices

o Foreign aid and corruption

o Should LeBron James paint his own house?

o Too big to fail

o Does revenge have an evolutionary logic?

 

Show the importance of microeconomic concepts in everyday life

Practical coverage of microeconomics helps students see how they can apply course content in their own decision-making.

·    An integrated approach to consumption and production. Chapters 5 and 6 show students that consumption and production are really two sides of the same coin, glued together by the idea of incentives. Upon grasping the commonalities and linkages between the processes of consumer and producer decisions, the student is able to view the whole picture and better understand how these concepts tie together.

·    In-depth coverage of game theory yields powerful insights. Chapter 13 is devoted entirely to game theory, which is a source of some very powerful economic insights. This chapter emphasizes that it helps us better understand the world when we place ourselves in the shoes of someone else. In so doing, each student may develop a deeper understanding of how to choose a strategy that is a best response to the strategies of others. In this chapter, game theory is applied to many situations, including pollution, soccer, and advertising, to name a few.

·    An innovative suite that extends the microeconomic toolbox. Chapters 15–17 help students see the relevance of the study of microeconomics, which is applicable to real-life topics such as how compound interest causes an investment’s value to grow over time, adverse selection in the health insurance market, and the bargaining that takes place in auctions every day—from eBay to estate auctions to charity auctions. And the book comes to a close in innovative fashion with Chapter 18 on social economics. Exploring the economics of charity and fairness and the economics of revenge, this final chapter drives home the fact that economic principles can be extended to every corner of our world.

 

Bring macroeconomics to life through clear, contemporary coverage

Contemporary coverage of macroeconomics via a clear framework helps students understand key concepts, and highlights the relevance of economics in their own lives.

·    A comprehensive treatment of Growth and Development. Chapter 21, Economic Growth, shows how economic growth has transformed many countries over the past 200 years. A simplified version of the Solow Model is in an optional appendix for instructors who want a more in-depth treatment. Chapter 22 explores why the whole world isn’t economically developed and considers fundamental causes of prosperity.

·    Three key markets that play a central role in macro analysis. Chapter 23 begins with the labor market, competitive equilibrium, and how imperfectly flexible wages lead to unemployment. Chapter 24 extends the analysis by incorporating the credit market, and Chapter 25 introduces the monetary system and the market for bank reserves.

·    A modern framework to analyze and explain short-run fluctuations. The authors’ approach is inclusive and integrative, utilizing the most relevant and useful insights from many different schools of economic thought. The labor market and unemployment are at the center of the analysis, as the authors believe that the labor market is the most informative lens through which beginning economics students can understand economic fluctuations. In this part of the book, the discussion extends to the role of financial markets and financial crises. Chapter 26 lays the foundation of the approach, showing how a wide range of economic shocks causes short-run fluctuations and how a model of fluctuations can be constructed using the labor market. Chapter 27 discusses the monetary and fiscal policies utilized to partially offset aggregate fluctuations.

·    A view of the global economy. Chapter 28 shows how international trade works using the concepts of specialization, comparative advantage, and opportunity cost. Chapter 29 studies how exchange rates are determined, how the foreign exchange market operates, and how changes in the real exchange rate impact the macroeconomy.

 

 

Pearson MyLabTM Economics not included. Students, if MyLab is a recommended/mandatory component of the course, please ask your instructor for the correct ISBN and course ID. MyLab should only be purchased when required by an instructor. Instructors, contact your Pearson rep for more information.


MyLab is an online homework, tutorial, and assessment product designed to personalize learning and improve results. With a wide range of interactive, engaging, and assignable activities, students are encouraged to actively learn and retain tough course concepts.

·    Digital Interactives. Economic principles are not static ideas, and learning them shouldn’t be either! Digital Interactives are dynamic and engaging assessment activities that promote critical thinking and application of key economic principles. Each Digital Interactive has 3-5 progressive levels and requires approximately 20 minutes to explore, apply, compare, and analyze each topic. Many Digital Interactives include real-time data from FRED™ allowing professors and students to display, in graph and table form, up-to-the-minute data on key macro variables. Digital Interactives can be assigned and graded within MyLab, or used as a lecture tool to encourage engagement, classroom conversation, and group work.

·    Interactive Reading Assignments in MyLab enable educators to encourage core reading by providing an assessment incentive along the way. These short reading segments feature embedded exercises that prompt students to learn actively. And, they're automatically graded, so educators can integrate assessment into reading assignments quickly and easily.

 

New to this Edition

Real issues engage students with the content

  • Examination of causality. By studyingrecent research that reports a positive correlation between expensive weddings and high rates of divorce, students will learn to determine the difference between correlation and causality, and better understand the role of omitted variables (Chapter 2).
  • Coverage of the fracking revolution and its impact on oil and gas prices. Supply and demand come alive when students can see how the recent rightward shift in the oil supply curve--due to the development of fracking technologies--has played a role in halving the equilibrium price of oil (Chapter 4).   
  • Focus on the shared economy. The role of surge pricing in equilibrating Uber driver supply and rider demand is discussed, helping students to more deeply understand the markets that they personally use (Chapter 7).
  • Emphasis on the role of microeconomics in examining prominent social issues. From natural disaster management to global inequality, students examine important social issues–such as how to reduce fracking-generated earthquakes by applying the concept of externalities, inequality in Scandinavia, broadband access, and more.
  • Coverage of the recent election to teach topics like probability. Students use analytic tools to understand how to interpret forecasts on the eve of the election (Chapter 15).
  • Coverage describing the growth of economic inequality, and emphasizing that inequality is not measured in economic aggregates, such as GDP (Chapter 19).

 

An evidence based approach using real issues and data

  • Evidence-Based Economics (EBE) features show how economists use data to answer the question posed in the opening paragraph of each chapter. EBEs use actual data from field experiments, lab experiments, and the government or naturally occurring data, while highlighting major concepts in the chapter. These features let students get a real look at economics as it plays out in the world around them, and gives them the skills to question systematically and evaluate what they read. Examples include:
    • Uber and the invisible hand?
    • What can the government do to lower earthquakes in Oklahoma?
  • Letting the Data Speak features reinforce the theme of evidence behind the theory. These short, targeted explorations analyze an economic question by using real data as the foundation of the discussion. Among the many issues explored:
    • Forecasts on the eve of the election
    • The great productivity puzzle--discussing how we may be experiencing a slow-down of aggregate productivity despite the rapid introduction of a range of new technologies in the economy (Chapter 21)
    • Democracy and growth, showing the positive impact of democratic political institutions on economic growth (Chapter 22)
    • Financing start-ups (Chapter 24)
    • The response of consumption to tax cuts (Chapter 27)
  • Choice and Consequence features emphasize optimization--one of the key themes in the book--by focusing on making the best decision. These features ask students to make an economic decision, or evaluate the consequences of past real decisions. The authors then explain how an economist might analyze the same decision. Examples of choices investigated include:
    • The societal consequences of the expulsion of Jewish faculty from universities in Nazi Germany (Chapter 20)
    • Minimum wage laws and employment (Chapter 23)
    • Luddite resistance to new technology and what this can teach us about the disruption that new and more productive robots are bringing to the economy today (Chapter 23)
    • Obtaining reserves outside of the federal funds market (Chapter 25)
    • The new administration’s fiscal policy proposals (Chapter 27)
    • The political forces that influence trade policy (Chapter 28)
  • Graphical Exhibit describing the relationship between interest rates and net capital outflows, unifying material from several chapters for the analysis of open economy macroeconomics (Chapter 29)

 

Show the importance of macroeconomic concepts in everyday life

Practical coverage of macroeconomics helps students see how they can apply course content in their own decision-making.

  • Examination of the labour market in terms of the downward nominal wage rigidity (Chapters 23, 26, and 27).
  • Simplified presentation of the two-part labour supply curve for easier student comprehension (Chapters 26 and 27).

Table of Contents

PART I: INTRODUCTION TO ECONOMICS

1. The Principles and Practice of Economics

2. Economic Methods and Economic Questions

3. Optimization: Doing the Best You Can

4. Demand, Supply, and Equilibrium

 

PART II: FOUNDATIONS OF MICROECONOMICS

5. Consumers and Incentives

6. Sellers and Incentives

7. Perfect Competition and the Invisible Hand

8. Trade

9. Externalities and Public Goods

10. The Government in the Economy: Taxation and Regulation

11. Markets for Factors of Production

 

PART III: MARKET STRUCTURE

12. Monopoly

13. Game Theory and Strategic Play

14. Oligopoly and Monopolistic Competition

 

PART IV: EXTENDING THE MICROECONOMIC TOOLBOX

15. Trade-offs Involving Time and Risk

16. The Economics of Information

17. Auctions and Bargaining

18. Social Economics

 

PART V: INTRODUCTION TO MACROECONOMICS

19. The Wealth of Nations: Defining and Measuring Macroeconomic Aggregates

20. Aggregate Incomes

 

PART VI: LONG-RUN GROWTH AND DEVELOPMENT

21. Economic Growth

22. Why Isn’t the Whole World Developed?

 

PART VII: EQUILIBRIUM IN THE MACROECONOMY

23. Employment and Unemployment

24. Credit Markets

25. The Monetary System

 

PART VIII: SHORT-RUN FLUCTUATIONS AND MACROECONOMIC POLICY

26. Short-Run Fluctuations

27. Countercyclical Macroeconomic Policy

 

PART IX: MACROECONOMICS IN A GLOBAL ECONOMY

28. Macroeconomics and International Trade

29. Open Economy Macroeconomics

 

CHAPTERS ON THE WEB

1. Financial Decision Making

2. Economics of Life, Health, and the Environment

3. Political Economy