Table of Contents

PART I: INTRODUCTION TO ECONOMICS 1. The Principles and Practice of Economics 2. Economic Methods and Economic Questions 3. Optimization: Doing the Best You Can 4. Demand, Supply, and Equilibrium PART II: FOUNDATIONS OF MICROECONOMICS 5. Consumers and Incentives 6. Sellers and Incentives 7. Perfect Competition and the Invisible Hand 8. Trade 9. Externalities and Public Goods 10. The Government in the Economy: Taxation and Regulation 11. Markets for Factors of Production PART III: MARKET STRUCTURE 12. Monopoly 13. Game Theory and Strategic Play 14. Oligopoly and Monopolistic Competition PART IV: EXTENDING THE MICROECONOMIC TOOLBOX 15. Trade-offs Involving Time and Risk 16. The Economics of Information 17. Auctions and Bargaining 18. Social Economics

Long Description

For courses in Principles of Microeconomics. An evidence-based approach to economics Throughout Microeconomics , 2nd Edition, authors Daron Acemoglu, David Laibson, and John List use real economic questions and data to help students learn about the world around them. Taking a fresh approach, they use the themes of optimization, equilibrium, and empiricism to not only illustrate the power of simple economic ideas, but also to explain and predict what's happening in today's society. Each chapter begins with an empirical question that is relevant to the life of a student, and is later answered using data in the Evidence-Based Economics feature. As a result of the text's practical emphasis, students will learn to apply economic principles to guide the decisions they make in their own lives. MyLabTM Economics not included. Students, if MyLab is a recommended/mandatory component of the course, please ask your instructor for the correct ISBN and course ID. MyLab should only be purchased when required by an instructor. Instructors, contact your Pearson rep for more information. MyLab is an online homework, tutorial, and assessment product designed to personalize learning and improve results. With a wide range of interactive, engaging, and assignable activities, students are encouraged to actively learn and retain tough course concepts.

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Three key principles--optimisation, equilibrium, and empiricism--lie at the heart of the authors'' approach. Chapters 1 - 4 introduce these key themes, and lay the groundwork for understanding the economic way of thinking about the world. Optimisation. The first principle--that people try to choose the best available option--is optimisation. Economists believe that optimisation explains most choices people make, including minor decisions like deciding whether to eat a cheeseburger, and major decisions like deciding whom to date or marry. When people fail to optimise perfectly, economic reasoning can be used to analyse the mistake and to suggest a better course of action. Equilibrium. Economic systems tend toward equilibrium, wherein each economic actor feels that he or she cannot do any better by picking another course of action. This principle highlights the connections among economic actors and their choices. In a state of equilibrium, consumers and purveyors of goods and services are simultaneously optimising, and their behaviors are consequently intertwined. Empiricism. While the first two key principles are conceptual, the third is methodological. Economists use data to test economic theories, learn about the world, and speak to policymakers. The emphasis on matching theories with real-world data to answer specific questions helps to show students the evidence behind the theory, making economics concrete, interesting, and fun. Examination of causality. By studying recent research that reports a positive correlation between expensive weddings and high rates of divorce, students will learn to determine the difference between correlation and causality, and better understand the role of omitted variables (Chapter 2). Coverage of the fracking revolution and its impact on oil and gas prices. Supply and demand come alive when students can see how the recent rightward shift in the oil supply curve--due to the development of fracking technologies--has played a role in halving the equilibrium price of oil (Chapter 4). Focus on the shared economy. The role of surge pricing in equilibrating Uber driver supply and rider demand is discussed, helping students to more deeply understand the markets that they personally use (Chapter 7). Emphasis on the role of microeconomics in examining prominent social issues. From natural disaster management to global inequality, students examine important social issues--such as how to reduce fracking-generated earthquakes by applying the concept of externalities, inequality in Scandinavia, broadband access, and more. Coverage of the recent election to teach topics like probability. Students use analytic tools to understand how to interpret forecasts on the eve of the election (Chapter 15). Evidence-Based Economics (EBE) features show how economists use data to answer the question posed in the opening paragraph of each chapter. EBEs use actual data from field experiments, lab experiments, and the government or naturally occurring data, while highlighting major concepts in the chapter. These features let students get a real look at economics as it plays out in the world around them, and gives them the skills to question systematically and evaluate what they read. Examples include: Choice and Consequence features emphasise optimisation--one of the key themes in the book--by focusing on making the best decision. These features ask students to make an economic decision, or evaluate the consequences of past real decisions. The authors then explain how an economist might analyse the same decision. Examples of choices investigated include: An integrated approach to consumption and production. Chapters 5 and 6 show students that consumption and production are really two sides of the same coin, glued together by the idea of incentives. Upon grasping the commonalities and linkages between the processes of consumer and producer decisions, the student is able to view the whole picture and better understand how these concepts tie together. In-depth coverage of game theory that yields powerful insights. Chapter 13 is devoted entirely to game theory, which is a source of some very powerful economic insights. This chapter emphasises that it helps us better understand the world when we place ourselves in the shoes of someone else. In so doing, each student may develop a deeper understanding of how to choose a strategy that is a best response to the strategies of others. In this chapter, game theory is applied to many situations, including pollution, soccer, and advertising, to name a few. An innovative suite that extends the microeconomic toolbox. Chapters 15-17 help students see the relevance of the study of microeconomics, which is applicable to real-life topics such as how compound interest causes an investment''s value to grow over time, adverse selection in the health insurance market, and the bargaining that takes place in auctions every day--from eBay to estate auctions to charity auctions. And the book comes to a close in an innovative fashion with Chapter 18 on social economics. Exploring the economics of charity and fairness and the economics of revenge, this final chapter drives home the fact that economic principles can be extended to every corner of our world.

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