This book covers a lot of ground in contemporary macroeconomics, from fundamental theories such as market structures and equilibrium to emerging concepts that reflect the most critical challenges of modern times, including economic slowdowns, the resilience of public health systems, digitalization, environmental footprints, and many more. The COVID-19 outbreak has aggravated the recurrent problems of poverty and income inequality between countries, food insecurity and hunger, unemployment, and social disorders that have resulted in the exacerbation of political, economic, and trade tensions between countries. In view of the damaging consequences of the pandemic for the entire global economy, the book examines how existing macroeconomic tools and policies could be adapted to the new normal to ensure sustainable post-pandemic development and growth.
The main text is interspersed with real-life illustrations and cases that demonstrate practical implications of the concepts under study. This makes the reading relevant and active. Every chapter starts with learning objectives and ends with a series of questions and quizzes that enable easier reinforcement of the course content. This book is written mainly for students, but it would be much useful to the broader public audience, including postgraduates, researchers, and business people who will be able to learn all recent updates about macroeconomics and the post-pandemic perspectives of the global economy.
Author(s): Vasilii Erokhin, Gao Tianming, Jean Vasile Andrei
Series: Springer Texts in Business and Economics
Publisher: Springer
Year: 2023
Language: English
Pages: 944
City: Singapore
Foreword
Preface
Acknowledgments
Contents
About the Authors
Abbreviations
I Essentials of Macroeconomics
1 Introduction
1.1 Subject of Macroeconomics
1.2 Major Schools of Thought
1.2.1 Classical School
1.2.2 Keynesian School
1.2.3 Monetarism
1.3 Study of Macroeconomic Processes
1.3.1 Aggregation
1.3.2 Modelling
1.4 Basic Concepts and Definitions
1.5 National Economy and Reproduction
1.5.1 Macroeconomics and National Economy
1.5.2 Economic Reproduction
References
2 Macroeconomic Indicators
2.1 Costs, Revenues, and Profit
2.1.1 Costs
2.1.2 Revenues
2.1.3 Profit
2.2 Economies and Diseconomies of Scale
2.3 Gross Domestic and National Products
2.4 National Income and Wealth
2.5 Quality of Macroeconomic Measurements
References
3 Market Structures
3.1 Market Structures and Concentration
3.2 Competitive Markets
3.2.1 Types of Competition
3.2.2 Perfect Competition
3.2.3 Monopolistic Competition
3.3 Monopoly and Oligopoly
3.3.1 Monopoly
3.3.2 Oligopoly
3.4 Monopsony and Oligopsony
3.4.1 Monopsony
3.4.2 Oligopsony
References
4 Major Actors in Contemporary Markets
4.1 Governments and Macroeconomic Policies
4.2 Households
4.3 Firms and Corporations
4.3.1 Firms and the Theory of the Firm
4.3.2 Transnational Corporations
4.4 Countries and Alliances
4.4.1 State as Economic Entity
4.4.2 Integration of Countries
4.5 International Organizations
4.5.1 International Financial Organizations
4.5.1.1 International Monetary Fund
4.5.1.2 World Bank Group
4.5.1.3 Bank for International Settlements
4.5.1.4 Financial Stability Board
4.5.2 International Trade Organizations
4.5.2.1 World Trade Organization
4.5.2.2 United Nations Conference on Trade and Development
4.5.2.3 World Customs Organization
4.5.3 Other International Economic Organizations
4.5.3.1 United Nations Organization on Industrial Development
4.5.3.2 Food and Agriculture Organization
4.5.3.3 International Labor Organization
4.5.3.4 European Bank for Reconstruction and Development
4.5.3.5 Asian Development Bank
References
II Disequilibrium Macroeconomics
5 Demand and Supply
5.1 Demand, Supply, and Equilibrium in Markets
5.1.1 Demand
5.1.2 Supply
5.1.3 Equilibrium
5.2 Aggregate Demand and Aggregate Supply
5.2.1 Aggregate Demand
5.2.2 Aggregate Supply
5.3 Shifts in Demand and Supply and Changes in Equilibrium
5.3.1 Taxation
5.3.2 Subsidies
5.3.3 Price Administration
5.3.3.1 Price Ceiling
5.3.3.2 Price Floor
5.3.4 Public Procurement
5.3.5 Market Intervention
5.3.6 International Trade
5.3.7 Import Tariff and Import Quota
5.3.8 Export Tariff
5.4 Price Determination and Price Elasticities of Demand and Supply
5.4.1 Elasticity of Demand
5.4.2 Elasticity of Supply
References
6 Macroeconomic Equilibrium
6.1 Theory of Macroeconomic Equilibrium
6.1.1 Classical Theory of Macroeconomic Equilibrium
6.1.2 Keynesian Theory of Macroeconomic Equilibrium
6.1.3 Marxian Model of Macroeconomic Equilibrium
6.1.4 Walrasian General Equilibrium
6.2 National Economic Performance
6.2.1 Classical Economics
6.2.2 Concept of Marginal Efficiency
6.2.3 Neoclassical Economics
6.2.4 Institutional Economics
6.3 Consumption, Investment, and the Multiplier
6.3.1 Neoclassical Concept of Consumption and Investment
6.3.2 Keynesian Concept of Consumption and Investment
6.3.3 The Multiplier
6.4 Commodity Market Equilibrium
6.4.1 Neoclassical Interpretation of Commodity Market Equilibrium
6.4.2 Keynesian Interpretation of Commodity Market Equilibrium
6.5 Equilibrium in Commodity and Money Markets: The IS-LM Model
6.6 Equilibrium and the New Normal Approaches to Economic Policy
6.6.1 Interpreting the IS-LM Model
6.6.2 Equilibrium and Monetary Policy
6.6.3 Equilibrium and Fiscal Policy
6.6.4 The New Normal Equilibrium
References
7 Economic Cycles
7.1 Theory of Economic Cycles
7.1.1 Marxian Interpretation of Economic Cycle
7.1.2 Neoclassical Interpretation of Economic Cycle
7.1.3 Keynesian Interpretation of Economic Cycle
7.2 Types of Economic Cycles
7.2.1 Kitchin Inventory Cycles
7.2.2 Juglar Fixed-Investment Cycles
7.2.3 Kuznets Infrastructural Investment Cycles
7.2.4 Kondratiev Waves
7.3 Crises of the Modern Age: From the Great Depression to the COVID-19
7.3.1 Structural Crises
7.3.2 Agrarian Crises
7.3.3 Financial Crises
7.3.4 Monetary Crises
7.3.5 Stock Market Crises
7.3.6 Modern Crises of Economic Transformation
7.4 Equilibrium Determinants
7.4.1 Approaches to Interpretation of the Equilibrium Determinants
7.4.2 Self-sustaining Fluctuations
7.5 Stabilization Policies
References
8 Disequilibrium and Unemployment
8.1 Labor Market
8.2 Unemployment
8.2.1 Foundations of Unemployment
8.2.2 Theories of Unemployment
8.3 Effects of Unemployment
8.4 Labor Market Regulation
References
9 Disequilibrium and Inflation
9.1 Foundations of Inflation
9.1.1 Meaning of Inflation
9.1.2 Types of Inflation
9.1.3 Theories of Inflation
9.2 Causes and Effects of Inflation
9.2.1 Causes
9.2.2 Effects
9.3 Measuring Inflation
9.4 Dealing with Inflation in the New Normal
References
III Market Failure
10 Government Interventions in Unbalanced Markets
10.1 Failures and Imbalances in Markets
10.1.1 Market Failures
10.1.2 Government Failures
10.1.3 Government Regulations
10.2 Rise in Monopoly Power and Antitrust Regulation
10.3 Asymmetrical Information
10.4 Market Externalities
10.4.1 Internalization of Externalities
10.4.2 Corrective Taxes and Subsidies
10.4.3 Distribution of Property Rights
10.4.4 Direct Government Control
10.5 Public Goods
10.6 Lockdowns and Disruptions to Supply Chains
References
11 Money
11.1 Fundamentals of Money
11.1.1 Role of Money
11.1.2 Theories of Money
11.2 Monetary System
11.2.1 Forms of Money
11.2.2 Money Circulation
11.3 Money Market
11.4 Monetary Policy
11.5 Monetary Approaches to the New Normal Equilibrium
References
12 Credit and Banking
12.1 Fundamentals of Credit
12.2 Lending and Lending Rate
12.3 Central Banks and Credit System
12.4 Commercial Banks
Reference
13 Public Finance
13.1 Fundamentals of Finance
13.2 Government Budget and Public Debt
13.3 Taxes and Taxation
13.4 Fiscal Policy
13.5 Fiscal Approaches to the New Normal Equilibrium
References
14 Social Issues of Economic Growth
14.1 Social Policy
14.2 Economic Growth and Social Justice
14.3 Welfare and Wellbeing
14.3.1 The Concept of Social Welfare
14.3.2 The Pareto Criterion
14.3.3 The Utilitarian Concept
14.3.4 Cardinal Utility
14.3.5 The Rawls Criterion
14.3.6 The Concept of Social Wellbeing
14.4 Poverty
14.5 Inequality
References
IV The New Normal Development and Growth
15 Foundations of Economic Development
15.1 Basic Economic Development Concepts
15.1.1 Economic Development and Economic Growth
15.1.2 Institutional Development
15.1.3 Stable and Sustainable Economic Development
15.2 Classical Theories
15.2.1 Smith’s Self-interested Competition
15.2.2 Ricardo’s Specialization
15.2.3 Malthus’s Constant Productivity Constraints
15.3 Marxism and Neo-Marxism
15.3.1 Marx’s Capital Accumulation
15.3.2 Rostow’s Linear Growth Model
15.3.3 Baran’s Economic Surplus
15.3.4 The Neocolonial Dependence Model
15.3.5 Warren’s Shift Toward Socialism
15.4 Neoclassical Theories
15.4.1 The Harrod-Domar Growth Model
15.4.2 The Robinson Growth Model
15.4.3 The Solow-Swan Growth Model
15.4.4 The Mankiw-Romer-Weil Model
15.4.5 The Kaldor Growth Model
15.5 Developmentalist Theories
15.5.1 Lewis’s Unlimited Supply of Labor
15.5.2 Hirschman’s Unbalanced Growth
15.5.3 Nurkse’s Balanced Growth
15.5.4 The Rosenstein-Rodan Big Push
15.6 Contemporary Interpretations of Economic Development
15.6.1 Structuralism
15.6.2 Institutionalism
15.6.3 International Dependence
References
16 Technological Choice and Development
16.1 Technologies and the New Normal Economy
16.1.1 Innovation-Driven Development
16.1.2 Innovations and the New Normal Economic Development
16.2 Technological Development Priorities
16.2.1 International Development Agenda
16.2.2 Technological Development Regimes
16.2.3 The New Normal Technological Trends
16.3 Production and Technological Possibilities
16.4 Innovation Pessimism
16.5 Creative Destruction
References
17 Human Capital and Economic Development
17.1 Approaches to Understanding Human Capital
17.2 Theories of Economic Growth and Human Capital
17.2.1 Classical School, Marxism, and Neoclassics
17.2.2 Schultz’s Human Capital Theory
17.2.3 Becker’s Neoclassical Human Capital Theory
17.2.4 Modern Interpretations of Human Capital Development and Economic Growth
17.3 Investing in Human Capital: Growth Effects and Returns
17.4 Inequalities in Human Capital Development
17.5 Human Capital and Education
17.6 Human Capital and Health
References
18 Post-pandemic Sustainable Development: The Farer-Reaching Perspective
18.1 Sustainable Development Concepts
18.2 Sustainable Economic Development
18.2.1 Understanding and Measuring Sustainable Economic Development
18.2.2 Green Economy
18.2.3 Blue Economy
18.3 Economics and Environment
18.4 Environmental Footprints
18.4.1 The Ecological Footprint Concept
18.4.2 Air Pollution
18.4.3 Climate Change
18.4.4 Water Pollution
18.4.5 Soil Pollution
18.4.6 Biodiversity Loss
18.5 Pursuing Sustainable Development
References
V Globalization and International Competitiveness
19 Theories of International Trade and Competitiveness
19.1 Classical Country-Based Theories
19.1.1 Mercantilism
19.1.2 Smith’s Absolute Advantage
19.1.3 Ricardo’s Comparative Advantage
19.1.4 The Heckscher-Ohlin Theorem
19.2 Modern Firm-Based Theories
19.2.1 Vernon’s Model of International Product Life Cycle
19.2.2 Linder’s Hypothesis
19.2.3 Posner’s Technological Gap Theory
19.2.4 Hicks’ Theory of Technological Progress
19.2.5 Krugman’s Economies of Scale
19.3 Alternative Concepts of International Trade
19.3.1 Haberler’s Theory of Opportunity Costs
19.3.2 Minhas’ Theory of Factor Intensity Reversal
19.3.3 The Samuelson-Jones Theorem
19.3.4 Balassa’s Theory of Intra-industry Trade
19.4 Emerging Theories of International Trade
19.4.1 Melitz’s Model of Heterogeneous Firms
19.4.2 Theory of Incomplete Contracts
19.4.3 Porter’s Theory of Competitive Advantage
19.4.4 The Gravity Model
19.4.5 Spatial Economy and International Trade
References
20 International Capital Flows and Exchange
20.1 International Capital Movement
20.1.1 Foundations of Capital Exchange
20.1.2 Classical Theories of International Capital Movement
20.1.3 The Keynesian Interpretation of International Capital Movement
20.1.4 Theories of International Financing for Development
20.2 International Investment
20.2.1 Direct Investment
20.2.2 Portfolio Investment
20.3 External Debt
20.4 Exchange Rates and Currency Trading
20.4.1 Currency
20.4.2 Exchange Rate
20.5 Foreign Exchange Market
References
21 International Migration of Labor
21.1 Fundamentals of International Migration
21.2 Theories of International Migration of Labor
21.2.1 Ravenstein’s Migration Laws
21.2.2 Lee’s Push and Pull Factors
21.2.3 Neoclassical Theory of Migration
21.2.4 Piore’s Dual Labor Market
21.2.5 New Economics of Labor Migration
21.2.6 Wallerstein’s World Systems
21.2.7 Human Capital in the Context of Labor Migration
21.3 Drivers and Effects of International Migration
21.3.1 Drivers
21.3.2 Effects
21.4 Governance of International Migration
21.5 The New Normal Trends
References
22 Liberalization and Protectionism
22.1 Free Trade and Protectionism
22.1.1 Free Trade
22.1.2 Protectionism
22.2 Foreign Trade Policy
22.2.1 Theories of Foreign Trade Policy
22.2.2 Tariff Regulation
22.2.3 Non-tariff Regulation
22.3 Multilateral Regulation of International Trade
22.4 The New Rise in Protectionism
References
23 Globalization and Regionalization
23.1 Globalization Through the Ages
23.2 Measuring Globalization
23.3 Effects and Controversies of Globalization
23.4 The New Anti-globalization
23.5 Globalization and Social Policy in the New Normal
References
Glossary
Further Reading
Index
