Preface
Greek philosopher Heraclitis said more than 2,500 years ago that “Nothing endures but change.” Forecasting is a tricky business, but this sentiment strikes us as being as safe a bet as one can make. Change—rapid change—underlies all our lives. As we were completing the previous version of this textbook, the world had entered a period of marked economic uncertainty, now referred to as the Great Recession, that led many students, and indeed people from all walks of life, to tune into economic events as never before to try to understand the economic world around them. As we worked on this new version, it was political uncertainty that had taken center stage. Two electoral outcomes—first, the decision by citizens of the United Kingdom to pull out of the European Union (known as the Brexit vote) and the decision by citizens of the United States to select Donald J. Trump as president—were not widely predicted. How would these political outcomes affect economic policies and economic outcomes? The last decade has certainly given economists the public’s attention, and we see an opportunity to share economics principles and the economic way of thinking in a way that emphasizes their relevance to today’s world.
We use applications from sports, politics, campus life, current events, and other familiar settings to illustrate the links between theoretical principles and common experiences. Because of the increasingly global nature of economic activity and the current backlash to it, we also recognize the need for a clear and consistent international focus throughout an economics text. In addition, we have tried to provide a sense of the intellectual excitement of the field and an appreciation for the gains it has made, as well as an awareness of the challenges that lie ahead. Always trying to help students to see the relevance of economic ideas, in this new edition in the microeconomics section, we have incorporated, for example, research on technological change and the wage gap, the future of jobs, carbon-neutral tax schemes, and the controversy around increasing the minimum wage. In the macroeconomics section, we have analyzed how the recovery from the Great Recession played out, bringing in the extraordinary tools that the Federal Reserve used as well as the fiscal stimulus response and the Dodd-Frank legislation. We have also discussed the unprecedented growth of the Chinese economy and predictions concerning the pace of future growth in advanced economies. As in previous editions, we have provided a balance between current issues and historical context.
At the same time, in this new edition we have stayed true to what we believe are the elements that make this text effective. To begin with, to ensure students realize that economics is a unified discipline and not a bewildering array of seemingly unrelated topics, we develop the presentation of microeconomics and of macroeconomics around integrating themes.
The integrating theme for microeconomics is the marginal decision rule, a simple approach to choices that maximize the value of some objective. Following its presentation in an early microeconomics chapter, the marginal decision rule becomes an integrating device throughout the discussion of microeconomics. Instead of a hodgepodge of rules for different market conditions, we give a single rule that can be applied within any market setting.
The integrating theme for macroeconomics is the model of aggregate demand and aggregate supply. Following its presentation in an early macroeconomics chapter, this model allows us to look at both short-run and long-run concepts and to address a variety of policy issues and debates.
Recognizing that a course in economics may seem daunting to some students, we have tried to make the writing clear and engaging. Clarity comes in part from the intuitive presentation style, but we have also integrated a number of pedagogical features that we believe make learning economic concepts and principles easier and more fun. These features are very student-focused.
The chapters themselves are written using a “modular” format. In particular, chapters generally consist of three main content sections that break down a particular topic into manageable parts. Each content section contains not only an exposition of the material at hand but also learning objectives, summaries, examples, and problems. Each chapter is introduced with a story to motivate the material and each chapter ends with a wrap-up and additional problems. Our goal is to encourage active learning by including many examples and many problems of different types.
A tour of the features available for each chapter may give a better sense of what we mean:
Start Up— Chapter introductions set the stage for each chapter with an example that we hope will motivate readers to study the material that follows. These essays, on topics such as the value of a college degree in the labor market or how policy makers reacted to a particular economic recession, lend themselves to the type of analysis explained in the chapter. We often refer to these examples later in the text to demonstrate the link between theory and reality.
Learning Objectives— These succinct statements are guides to the content of each section. Instructors can use them as a snapshot of the important points of the section. After completing the section, students can return to the learning objectives to check if they have mastered the material.
Heads Up!— These notes throughout the text warn of common errors and explain how to avoid making them. After our combined teaching experience of more than 50 years, we have seen the same mistakes made by many students. This feature provides additional clarification and shows students how to navigate possibly treacherous waters.
Key Takeaways—These statements review the main points covered in each content section. These statements review the main points covered in each content section.
Key Terms— Defined within the text, students can review them in context, a process that enhances learning.
Try It! questions— These problems, which appear at the end of each content section and which are answered completely in the text, give students the opportunity to be active learners. They are designed to give students a clear signal as to whether they understand the material before they go on to the next topic.
Cases in Point— These essays included at the end of each content section illustrate the influence of economic forces on real issues and real people. Unlike other texts that use boxed features to present interesting new material or newspaper articles, we have written each case ourselves to integrate them more clearly with the rest of the text.
Summary—In a few paragraphs, the information presented in the chapter is pulled together in a way that allows for a quick review of the material.
End-of-chapter concept and numerical problems— These are bountiful and are intended to check understanding, to promote discussion of the issues raised in the chapter, and to engage students in critical thinking about the material. Included are not only general review questions to test basic understanding but also examples drawn from the news and from results of economics research. Some have students working with real-world data.
Chapter quizzes— Each chapter also includes online, supplementary multiple choice questions that provide students with feedback on both correct and incorrect responses. These provide yet another way for students to test themselves on the material.
Additional Material for Instructors
The authors have been personally involved in the generation of a huge Test Bank that includes multiple choice, true/false, and short essays questions. These questions are scored in terms of level of difficulty and include multiple ways of testing the material.
The Solutions Manual, with which the authors were also involved, contains answers for all concept and numerical problems found at the end of each text chapter.
The PowerPoint Slides include all the exhibits contained in the text to allow ease of use in class.
We hope that users will find this text an engaging and enjoyable way of becoming acquainted with economics principles and that mastery of the material will lead to looking at the world in a deeper and more meaningful way. We welcome all feedback.Special thanks to Eric Malm, Cabrini University, for his assistance on this edition.
Libby Rittenberg
Timothy Tregarthen