ISBN13: 9780072548457 ISBN10: 0072548452 All Product Details
Much economic reasoning is based on the opportunity cost principle, the idea that any decision involving scarce resources must involve costs in terms of forgone alternatives elsewhere. Peter Passell applies this principle to an age-old question: What is the value of a human life?
Lester Thurow maintains that the world is currently in the throes of a third industrial revolution, in which knowledgerather than natural resourcesis the key to success. The knowledge-based economy is asking new questions, giving new answers, and developing new rules for generating wealth.
Recently, a staggering number of corporate debacles is raising a disturbing question: Can capitalism survive the capitalists themselves? Kurt Eichenwald argues that the system has a built-in corrective factor that kicks in when abusessuch as those found at Enron, Global Crossing, and WorldComgo too far.
Joseph White claims that in the new millennium, corporations will be little more than brand names, covers for frequent-flying, cyberspace-cruising freelancers who form virtual teams on wireless networks.
One of the more useful concepts in microeconomics is demand elasticity, which measures the responsiveness of consumer demand to changes in prices. Recently, the New Jersey legislature doubled the state cigarette tax in an effort to reduce smoking. This article examines the impact that this has had on cigarette sales in both New Jersey and nearby states.
What does that restaurant meal really cost? Eileen Daspin calculates the prices that six American eateries pay for the food they serve and finds some surprises. Among them are that markups can amount to several hundred percent and that vegetarians tend to subsidize meat-eaters.
Burger King wanted to be french fry king. Instead, as Jennifer Ordonez shows, it created a fast-food fiasco. This case study provides interesting details on the importance of product differentiation as a strategic device used by highly competitive firms.
With Kmart hobbled by bankruptcy, it is Target that now gets the attention of Wal-Mart stores, the biggest retailer in the United States and also the biggest company. At stake are the wallets of the growing number of consumers who shop discount stores by choice.
The glorious, competitive free-for-all envisioned in the Telecommunications Act of 1996 hasnt arrived. The chairman of the Federal Communications Commission suggests that it is time to let the oligopolies fight it out themselves.
Consumers Union, the nonprofit consumer organization, once originally supported deregulation as a way to lower prices. However, in a recent study of government deregulation of five major industriesairlines, telecommunications, cable television, banking, and electricitythe organization concludes that this policy has caused a sharp deterioration in service and dramatic increases in hidden fees.
There have been five great waves of mergers in past centuries, each one building in some way toward the unprecedented mania of the late 1990s. The world economy is now littered with some $2 trillion in failed or failing corporate giantsEnron, WorldCom, and Vivendi among themand thats from the year 2000 alone.
Leslie Walker says that attempting to regulate antitrust in the age of convergence is like trying to grab jellyfish in the ocean. More and more companies are combining themselves into strange globs as they seek to compete in digital markets as murky as the sea.
“Three years ago energy problems appeared to be the economic equivalent of smallpoxa once frightful scourge that had been eradicated.” Then, in February 1999, the price of oil suddenly began to climb, and soon oil prices nearly quadrupled. Anna Bernasek explains the crucial role that OPEC has played in this process.
The retail price that Americans pay for gasoline appears to be very low in comparison with prices prevailing in most other nations. Adding in the many external costs that consumers pay indirectly by way of increased taxes, insurance costs, and retail prices in other sectors, this study estimates that real per gallon price to be in excess of fifteen dollars.
Absurdly high prices have put lifesaving prescription drugs out of reach for millions of Americans and for hundreds of millions of people in developing countries. According to Dean Baker, in large part, patent protection is to blame.
Because the economy is largely dependent on the consumption of fossil fuels that result in carbon emission byproducts, concerns exist about the economys ability to reduce these emissions without sacrificing output and employment. Lester Brown shows how responsible policies might benefit both the environment and the economy.
Overcrowding at public parks creates a classic microeconomic dilemma: Outdoor recreationists face insufficient parking spaces, which must be allocated through adjusting park fees. Dan Bechter investigates possible solutions to the problem.
For the better part of two decades, the gap in earnings between rich and poor Americans has increased steadily. Many factorsboth economic and noneconomicaffect this inequality. Robert Samuelson says that only about a third of the increase in income inequality reflects the faster-growing wages and salaries of the well-off.
In public opinion polls, most Americans say that poverty begins at an annual income of $20,000 or less for a family of four. Not even the Census Bureau (the official agency charged with gathering income statistics) believes its poverty numbers. The question is, How much (or little) money is enough?
Kevin Phillips, a former Republican adviser, demonstrates in his new book, Wealth and Democracy, how the growth of private wealth in the 1990s was analogous to the rise of private wealth in previous eras, especially the Gilded Age of the late nineteenth century and the 1920s.
According to conventional economic analysis, increases in the minimum wage could result in two things: those who remain employed get higher incomes, while other, less productive workers lose jobs as employers trim payrolls. The Economist examines recent evidence and finds that this view may (or may not) be incorrect.
Christopher Jencks argues that the critics of welfare reform were wrong because almost everyone underestimated how much government aid was being redirected from welfare support to work support. But will this continue?
Given a predicted long-term imbalance by 2041 between the costs of benefits and projected income for the Social Security System, a lively debate is under way over ways to reform the system. R. Kent Weaver outlines the compromises that true reform will require.
Jeff Lemieux argues that Medicare reform requires not only improving benefits for recipients but also using market forces to shore up the systems creaky inner workings.
A close look at the supply-and-demand equation suggests that the affordable housing squeeze is relatively easy to fix. As Christopher Farrell demonstrates, it is politics, not economics, that makes this problem so difficult.
Everything you might need to know about recessions can be found in this in-depth article.
Despite some setbacks, the data say that the U.S. economy is experiencing a recovery. If so, Louis Uchitelle says, why doesnt it feel better?
Public policies during the booming 1990s fostered an environment that actively encouraged private investment, ingenuity, and personal initiative. However, Robert Shapiro maintains that the current administration has revived supply-side policies that produce slower growth and exploding debt.
Do budget surpluses lead to bigger government? If this is so, the prudent thing to do is to get rid of surpluses; otherwise, government will grow bigger. Allen Schick says that the problem with this point of view is that, even if the government is broke, it will spend more.
With the recession apparently over, it is now possible to make a more realistic assessment of the entire business cycle of the 1990s: the sluggish recovery that started in March 1991, the extraordinary boom, the tech bust, and the downturn of 2001. Michael Mandel uncovers some surprising findings involving productivity trends.
A large share of economic activity occurs in the underground economy, where goods and servicessome legal, some notare produced but not reported. Elia Kacapyr considers possible implications of proposals for regulating such activity.
The debate over President Bushs tax cut has produced a good deal of ill-informed or outright tendentious rhetoric from both sides, which serves as a reminder of how confusing the working of our tax laws are to ordinary citizens and to some government leaders. Albert Crenshaw shows how an understanding of basic tax concepts can demystify the debate over tax cuts.
While economists have identified broad principles to guide monetary policy makers, making policy is not a science. Good policy making requires good policymakers since it requires combining the science of the economist with the art of the practitioner.
The Federal Reserve cut interest rates 11 times in 2001, and yet the economy remains sluggish. Allen Olson and Robert Meyerson assert that the Fed needs greater powers, including increased ability to exert its influence over Wall Street.
Adam Smith once observed that when business people meet, they usually wind up talking about “some contrivance to raise prices.” Rob Norton explains how Smiths idea might apply to those who advocate “pricing power” as a device for keeping interest rates low.
In the last few decades, the U.S. economy has been transformed through what Kevin Phillips calls “financialization.” Securities management, corporate reorganization, derivatives trading, and other forms of financial packaging are steadily replacing the act of making, growing, and transporting things. He asks: Will an era of reform follow a decade of excess?
“E-cash” (or electronic money) is money that moves along multiple channels largely outside the established network of banks, checks, and paper currency that are overseen by the Federal Reserve. The Economist discusses what e-money might mean for the future of banking and the monetary system.
While globalization has reduced barriers to the movement of goods and capital across national boundaries, it has also created a series of problems, including job losses, increasing income inequality, and stagnant or deteriorating real wages. The authors consider various controversies that globalization raises.
Joseph Stiglitz, a Nobel Prize winner and former chief economist of the World Bank, challenges the view that sees the expansion of free-market capitalism as the route to global prosperity. According to Stiglitz, the rich countries have hijacked globalization, using as weapons the I.M.F., the World Trade Organization, and other international bodies that are supposed to act in the interests of all countries.
Of all the debates surrounding globalization, one of the most contentious involves trade and workers rights. Gary Burtless maintains that while the moral case for requiring trading partners to respect labor rights is compelling, the case for removing trade barriers that limit the product markets and incomes of the worlds poorest workers is just as powerful.
New technologies change the ways that firms throughout the economy do business. Governments are starting to regulate the Internet. Robert Litan asks whether some kind of international collective action will be necessary to ensure that various national regulations do not artificially choke global Internet commerce in the future.
Some economists and politicians are concerned about Americas “unsustainable” current account deficit. Eventually, the argument goes, the foreigners who are investing hundreds of billions of dollars in the United States each year will find more attractive places to put their money. Rob Norton takes issue with this view.
The Free Trade Area of the Americas (FTAA) would create the worlds largest trading zone, stretching from Alaska to Argentina. Claudio Katz considers possible implications for international trade if such an organization were established.
The European Unions high-risk gamble on a common currency is facing a critical moment as 12 member countries of the euro zone struggle to grow their economies against the backdrop of a global slowdown that could easily slide into recession.
Since the start of reforms in 1992, significant progress has been made in many areas of the Russian economy. However, despite privatization, robust competition is still lacking in much of the economy, stifled by anticompetitive business structures and entry barriers.
The prospect of Chinese membership in the World Trade Organization (WTO) has been controversial, both within China and in the international community. A key factor pushing Chinas application forward has been its significant move toward a market-oriented economy in the 1990s. Penelope Prime considers possible next steps.
Big differences in per capita GDPs across countries are a rather recent phenomenon. Poor countries like to talk about the digital divide making the economic divide bigger, but, according to Lester Thurow, the digital divide is not a divide among rich and poorit is a divide between those with and without education.
Almost all the East Asian economies have recaptured the economic momentum disrupted by the 1997 financial crisis in the region. Shalendra Sharma examines some of the challenges ahead.
Much of the developing world continues to rely on child labor. Miriam Wasserman asks what we can learn from the U.S. experience about what is required for its elimination.
World consumption has expanded at an unprecedented pace over the twentieth century. As this United Nations report shows, competitive spending and conspicuous consumption have turned the affluence of some into the social exclusion of many.