Efnisyfirlit

• about the authors
• Contents
• Contents
• Contents
• preface
• Our approach
• Content and structure
• In summary
• Key issues
• Concepts boxes
• Business case studies
• Everyday economics
• Applying economics to business
• Reflecting on economics
• Think points
• Economics at work
• Summary
• Key terms
• Questions for discussion
• One thing you  should read
• guide to the book
• online resources
• 1: economics and business
• 1.1 Introduction: what is economics?
• What is produced?
• How is production organized?
• For whom is production organized?
• 1.2 Why economics matters to business, indeed to everyone
• 1.3 Understanding the roles of firms, consumers and government in markets
• What is the role of firms in markets?
• The role of consumers in markets
• The role of government in markets
• Aircraft
• Cars
• Mobile phone services
• Soft drinks
• 1.4 Scarcity, choice and opportunity cost
• 1.5 Opportunity cost and incentives
• 1.6 Microeconomics, macroeconomics and business
• Interest rates
• Exchange rates
• Confronting the 2008–9 recession
• 1.7 Positive and normative economics
• 2: the market
• 2.1 Introduction: the market, an old but still very useful institution
• 2.2 Consumers and demand in the market
• 2.3 Firms and supply in the market
• 2.4 The market: bringing demand and supply together
• The equilibrium price and market equilibrium
• Reflections on equilibrium price and market equilibria
• T-shirts
• Tuna fish
• Gold
• 2.5 Applying market analysis 1: the example of economic integration in the European Union
• 2.6 Elasticity in the market
• 2.7 Price elasticity of demand
• 2.8 Determinants of price elasticity of demand
• The availability of substitutes
• The proportion of income spent on a good or service, or why have Freddos more than doubled in pr
• Time
• 2.9 Why firms need to know about price elasticity of demand
• 2.10 Applying market analysis 2: OPEC and the market for oil
• 2.11 Other forms of elasticity
• Income elasticity of demand
• Applying income elasticity of demand
• Price elasticity of supply
• Determinants of price elasticity of supply
• Time
• The elasticity of supply of factor inputs
• 2.12 Markets and asymmetric information
• 2.13 Markets and the rational consumer
• 2.14 Markets: concluding remarks
• 3: the firm
• 3.1 Introduction
• 3.2 What do firms do?
• 3.3 Why is the firm a necessary institution?
• Savings on transaction costs
• The capacity of firms to extend the division of labour
• The potential of firms to innovate
• 3.4 Different kinds of firm
• Sole proprietorship
• Partnership
• Companies
• The relative advantages and disadvantages of different forms of ownership
• The taxation of the firm’s profits
• Liability
• Raising capital
• The management of the firm
• The John Lewis Partnership
• Facebook
• Sunderland football club
• 3.5 Reflections on the strategies of firms: profit maximization, economics and business strategy
• Are firms profit maximizers?
• Economics and business strategy: the case of Google
• Horizontal, vertical and diversified growth
• Growth by merger and acquisition
• 3.6 Firms’ strategies for survival: resolving the principal–agent problem, coping with asymme
• The principal–agent problem
• Firms and asymmetric information
• 3.7 The death of a firm
• 3.8 Firms and entrepreneurship: an Austrian view
• 4: firms’ costs and  revenues
• 4.1 Introduction
• 4.2 The short run and the long run
• 4.3 The short-run production function and the law of diminishing marginal returns
• 4.4 Short-run costs
• 4.5 Production in the long run
• 4.6 Long-run costs
• 4.7 Firms’ revenues
• Revenues and price takers
• Revenues and price makers
• 4.8 Profit maximization
• 5: market concentration and market power
• 5.1 Introduction
• 5.2 Market power
• Market power in the real world
• Monopoly and market power
• Market power in the context of branding, reputation and consumer preferences
• 5.3 Market structures, market power, price competition and non-price competition
• Haircuts
• Pubs, bars and restaurants
• New cars
• Train travel
• 5.4 Perfect competition
• The perfectly competitive firm as a price taker
• The revenue and cost curves of the perfectly competitive firm
• The short-run position of the perfectly competitive firm
• The long-run position of the perfectly competitive firm
• The perfectly competitive firm and allocative efficiency
• Perfect competition: a summary
• 5.5 Monopoly
• Sources of monopoly
• The economic implications of monopoly
• The monopolist’s output decision
• Monopoly and allocative efficiency
• Monopoly and price discrimination
• Reflections on monopoly
• Government regulation of monopoly
• 5.6 Imperfect competition (also known as monopolistic competition)
• 5.7 Oligopoly
• Oligopoly and price stability
• Why is there a tendency towards price stability in oligopoly?
• 5.8 Oligopoly and game theory
• Real-world dominant strategies in oligopoly
• 5.9 Market structures: an institutionalist view
• Consumers
• Costs and prices
• 6: business and government
• 6.1 Introduction
• 6.2 Market failure
• 6.3 Public goods
• 6.4 Externalities
• Negative externalities
• Positive externalities
• Externalities and the work of Ronald Coase
• 6.5 Public goods, externalities and business
• 6.6 The liberal view: market failure and state failure
• State failure
• State failure versus market failure
• Reflecting on the liberal view of market failure
• Liberalism: a summary
• 6.7 Privatization
• The rationale for privatization
• The case against privatization
• 6.8 Competition policy
• The Competition and Markets Authority (CMA)
• 6.9 Industrial policy
• Strengthening UK productivity
• Building long-term partnerships between businesses and government
• Addressing the ‘grand challenges’ that face the economy and society
• Reflecting on industrial policy
• 7: factor markets
• 7.1 Introduction
• 7.2 The labour market
• 7.3 The demand for labour
• The firm’s demand for labour in the short run
• The firm’s demand for labour in the long run
• Labour productivity and wages: some evidence
• 7.4 The supply of labour
• The supply of labour in an economy
• The individual’s supply of labour
• The supply of labour to a particular occupation
• The elasticity of labour supply
• 7.5 Issues in the labour market: bringing demand and supply together
• Skilled and unskilled labour
• Human capital
• Minimum wages: do they raise the wages of the low paid; do they destroy jobs?
• The labour market as a shock absorber
• 7.6 Factor incomes and economic rent
• Applying the concept of economic rent to different factor markets
• 8: the  macroeconomy, macroeconomic policy and  business
• 8.1 Introduction: the macroeconomic context of business
• 8.2 Economic growth
• The output method
• The expenditure method
• The income method
• Injections into the circular flow of income
• Withdrawals from the circular flow of income
• Injections and withdrawals in the circular flow – the significance of government involvement
• The circular flow, microeconomics and macroeconomics
• Further reflections on GDP
• 8.3 Unemployment
• 8.4 Inflation
• Measuring inflation
• The inflation objective
• Problems associated with inflation
• Shoe leather costs
• Menu costs
• Hyperinflation
• Market distortion
• Deteriorating international competitiveness
• The redistribution of income
• Inflation performances
• 8.5 The balance of payments
• 8.6 A brief overview of macroeconomic policy since 1945
• 9: unemployment: causes and cures
• 9.1 Introduction: the debate over the causes and cures for unemployment
• 9.2 The classical approach
• 9.3 The orthodox Keynesian approach
• Consumer expenditure
• Investment expenditure
• Government expenditure
• Net export expenditure
• The equilibrium level of national income in the Keynesian model
• 9.4 The monetarist approach
• 9.5 The new classical approach
• 9.6 The new Keynesian approach
• Efficiency wage model
• Insider–outsider model
• Hysteresis effects and unemployment
• 9.7 A case study: unemployment in Europe
• Appendix
• An alternative presentation using an Aggregate Demand (AD)–Aggregate Supply (AS) model
• 10: inflation: causes and cures
• 10.1 Introduction: the inflation debate
• 10.2 The monetarist view
• The quantity theory of money
• The traditional quantity theory of money
• The modern quantity theory of money
• The original Phillips curve
• The statistical relationship between inflation and unemployment
• The economic rationale for the original Phillips curve
• The original Phillips curve as a menu for policy choice
• The breakdown of the original Phillips curve
• The expectations-augmented Phillips curve
• Deriving a whole family of short-run Phillips curves and a vertical long-run Phillips curve
• Summing up
• Policy implications of the expectations-augmented Phillips curve
• The danger of triggering accelerating inflation
• The output–employment costs of reducing inflation
• Inflation as an international monetary phenomenon
• 10.3 The non-monetarist view
• Wage increases as the initiating force of inflation
• Policy implications of the non-monetarist view
• 10.4 A case study: maintaining price stability in the euro area
• 10.5 Concluding remarks
• Appendix
• Keynesians, monetarists and new classicists and the expectations-augmented Phillips curve
• 11: economic growth and business cycles
• 11.1 Introduction
• 11.2 Economic growth: an overview
• 11.3 The Solow growth model
• 11.4 The new endogenous growth models
• 11.5 Wider influences on economic growth
• Institutions
• International economic integration
• Geography
• 11.6 Main features of business cycles
• 11.7 The debate over the cause and control of business cycles
• The Keynesian approach
• The monetarist approach
• The monetarist way to run the economy
• The new classical approach
• The real business cycle approach
• The political business cycle approach
• 11.8 Concluding remarks
• Appendix
• The Solow growth model
• The aggregate production function
• The steady state
• 12: stabilizing the  economy
• 12.1 Introduction
• 12.2 Discretionary policy and policy rules
• Discretionary policy
• Policy rules
• 12.3 The rules versus discretion debate: problems of stabilization policy
• The Keynesian view
• The monetarist view
• Crowding out
• Tax changes
• Problems associated with stabilization policy
• The new classical view
• Policy ineffectiveness proposition
• Time inconsistency
• The Lucas critique
• The real business cycle view
• 12.4 Changing views on stabilizing the economy
• 12.5 Concluding remarks
• 13: international trade
• 13.1 Introduction
• The advantages of trade
• The economic basis for trade
• Some negative consequences of trade
• 13.2 The theory of comparative advantage
• 13.3 Reflecting on comparative advantage: further developments in trade theory
• Problems with the free trade process?
• What determines comparative advantage?
• Why don’t countries specialize to the extent that comparative advantage predicts?
• Product life-cycle theory
• The new theory of international trade
• 13.4 Patterns of trade since 1945
• 13.5 International trade policy
• Understanding protectionism
• The institutions of international trade policy: from GATT to the WTO
• The Uruguay Round (1986–94): extending trade liberalization and dealing with the new protection
• World Trade Organization replaces the GATT
• The EU and US/Cairns Group dispute
• The dispute settlement process
• The WTO’s first test: the Doha Round crisis
• 14: the balance of payments and exchange rates
• 14.1 Introduction
• 14.2 The balance of payments accounts
• Current account
• Capital account
• Financial account
• How the balance of payments works
• Surplus and deficit on the balance of payments
• Influences upon the current and financial accounts
• The demand for imports
• The demand for exports
• Factors affecting investment flows
• Disequilibria in the balance of payments
• The balance of payments performance of selected economies
• 14.3 The balance of payments and business
• 14.4 Exchange rates and exchange rate determination
• Nominal and real exchange rates
• Purchasing power parity
• Exchange rates are multiply determined
• 14.5 Exchange rate systems
• Flexible exchange rates
• Fixed exchange rates
• Correcting balance of payments disequilibria under fixed exchange rates
• The advantages of fixed exchange rates
• The integration argument
• The anchor argument
• Managed rates
• 14.6 Exchange rate systems in practice
• The Bretton Woods system
• The non-system
• The European exchange rate mechanism (ERM)
• 14.7 The euro
• The benefits of the euro
• The costs of the euro
• 14.8 The balance of payments, exchange rates and business
• Fixed exchange rates
• Flexible exchange rates
• Fixed versus flexible exchange rates in a business context
• 15: globalization
• 15.1 Introduction
• 15.2 What is globalization?
• Aspects of globalization
• Conceptualizing globalization from a business perspective
• 15.3 How far has globalization progressed?
• Recent patterns in world trade
• Recent patterns in world investment
• Some reflections on the distribution of world GDP
• Recent patterns in human migration
• Globalization – has it happened?
• 15.4 What are the attractions of globalization?
• Free and open trade is beneficial to all
• Trade and investment are complements in a globalized world
• 15.5 What threats might globalization pose?
• An unbalanced and less stable world economy?
• Issues of exclusion and exploitation
• Information economics, counteracting institutions and globalization
• 15.6 On reflection, how new is globalization anyway?
• glossary
• index