TITLE : MACRO ECONOMICS: ANALYSIS AND POLICY. 5TH ED.

 
Contents
 
INTRODUCTION  Basic economic concepts
 
1 What economics is about  3
 
Production and the circular flow. The central economic problem:
Scarcity and choice: Choice at the personal level. Choice at the
national leveL The basic decisions: What, how, and for whom? How
economists think: The languages of economics. Economic models and
their
uses. Explanation, prediction, and policy: Explanation: Positive
economics. Prediction: Economic forecasting. Policy analysis. What to
do: Normative economics.
 
2. The microeconomy: Markets and prices   27
 
Markets and prices Markets. Prices. Price determination under
competition: Individual demand. Market demand. Market supply. Market
equilibrium. Shifts in demand and supply. Free pricing and regulated
pricing: The functions of price. Price-fixing Surpluses and shortages.
Interrelation of markets: General equilibrium analysis.
 
3. The macroeconomy: National output and income   53
 
Measuring national output: Problems in adding up output. How output
and prices behave. The composition of output: Consumption, investment,
government, foreign trade: Consumer purchases. Business purchases.
Government purchases. Foreign trade. Output equals income. The uses of
income. Aggregate equilibrium and disequilibrium. Appendix: The U.S.
national income accounts.
 
PART ONE  Aggregate demand, Output, and prices
 
4 National output in a simplified economy   85
 
Aggregate demand: Consumption plus investment: The circular flow once
more. Spending on consumption. The household consumption schedule. The
national consumption schedule. Long-run behavior: Shifts in the
consumption schedule. The equilibrium rate of output. The autonomous
spending multiplier. Applications of the equilibrium concept: Good and
bad equilibrium points. The paradox of thrift. Saving and investment:
Planned and realized. Appendix: Algebraic derivation of the
multiplier.
 
5. National output in a more complex economy   112
 
Features of the expanded economy: Government activities. Business
saving. Exports and imports. The new consumption schedule. Aggregate
demand and equilibrium output. Application of the equilibrium concept:
A new and smaller multiplier. New sources of autonomous change. The
equilibrium condition once more.
 
6. The supply of money   127
 
The functions of money. What is money? The business of banking. How
demand deposits expand and contract. Bank reserves, the reserve
requirement, and demand deposits. Demand deposit expansion in a
step-by-step process: Demand deposit expansion in a more realistic
context. The Federal Reserve System. Federal Reserve monetary control:
Objectives and techniques: Open-market operations. Member bank
borrowing and the discount rate. The legal reserve requirement. The
money supply process.
 
7. Demand for money and the rate of interest   154
 
The demand for money: Transactions demand. Asset demand. Evidence on
the demand for money. The supply of money and the rate of interest:
The complex of interest rates.
 
8. Money, interest, and output   169
 
The quantity theory of money: Some monetarist propositions. Investment
and the rate of interest: Determining the return on investment. The
marginal efficiency of investment. Other factors influencing business
investment demand. Business investment: Some evidence on behavior.
Other effects of the rate of interest. Inventory investment. Housing
investment. Consumer spending. Government spending. Consequences of
adding money to the model. Appendix: The synthesis of money and
income.
 
9.	Inflation 193
 
Introduction. Sources of inflationary bias. Inflationary momentum:
The wage-price-wage spiral. Inflation and aggregate demand:
Acceleration on the upswing. Slow deceleration on the downswing.
Inflation and market power. Inflation and money supply. Supply shocks
and inflation: The two oil price explosions. Instability of grain
prices. The dollar exchange rate. Slower productivity growth. The
1981-83 disinflation: Good management or good luck? Inflation and its
consequences: Who gains and who loses?
 
10. Taxes, public spending, and public debt.  220
 
Introduction. The meaning of a fiscal program: The high-employment
fiscal surplus. A rule for budgetmaking? Financing the deficit. The
question of the debt.
 
PART TWO  Macroeconomic policy
 
11. Fluactions in national income  241
 
Economic fluctuations: What goes on: Some things fluctuate widely.
Some things always go up. Explanation: The role of investment:
Autonomous investment: Reasons for irregularity. Induced investment:
The acceleration principle. The mechanism of expansion. The upper
turning point. The downswing. Forecasting: Barometric forecasting:
Leading indicators. Econometric forecasting. The forecasting record.
 
12. Macroeconomics policy: Strategy and tools  261
 
Characteristics of a good policy instrument. Monetary policy: How
monetary policy operates. The choice of targets: Money supply versus
interest rates. Evaluating monetary policy. Fiscal policy: The meaning
of fiscal policy. Budget making in practice. Evaluating fiscal policy.
Policy mix and policy coordination. Fixed rules versus fine tuning:
Monetarists and activists: The key issues. A review of evidence. The
postwar policy record.
 
13. Coping with underemployment and inflation  286
 
Coping with underemployment: The problem: Output loss. The NAlRU as an
employment target. Employment targets and output targets. Reducing the
NAIRU. Coping with inflation: Creating economic slack. Supply and
costs. Incomes policy.
 
14. Long-term growth: The past and the future  307
 
GNP does not measure welfare. The record of economic growth. The
sources of economic growth: Growth and factor supplies. Improvement of
factor productivity: The residual. Explaining the residual: The
			economics of technical change. Disembodied technical progress.
Embodied
progress and factor quality. Learning and technical progress. The
recent productivity slowdown: A passing phase? The future of economic
growth: Population and food supply. Natural resource supplies. Can
the growth rate be manipulated? The future of the growth rate.
 
PART THREE  The international economy
 
15. The basis of international trade  333
 
Introduction. The basis of trade: Comparative cheapness. An
illustration of comparative cheapness. The principle of comparative
advantage: Comparativeadvantage: The international case. Comparative
advantage: Factor supplies. Comparative advantage: Technology.
Comparative advantage: The domestic market. Comparative advantage in
practice.
 
16. External balance and the world monetary system 358
 
The mechanism of international payments. The balance of payments.
The rate of exchange. Demand and supply of imports and exports.
Demand and supply of dollars: Adjustment to change. Fixed rates:
The Bretton Woods system. Floating rates and the future outlook:
Pros and cons of floating rates. Experience with floating rates.
 
17. Trade flows and trade policy  380
 
The pattern of world trade. Barriers to trade: The tariff controversy:
Tariffs: The gainers and losers. Tariffs: The national interest.
Issues
in American trade policy: Tariffs and quotas. Is the United States
deindustrializing? East- West trade. The United States and the Third
World: Some key issues: Pricing of primary products. Manufactured
exports from LDC's. "Official" capital transfers. Private lending and
the debt problem.
 
Glossary of concepts  407
Index  417