The ABCs of RBCs is the first book to provide a basic introduction to Real Business Cycle (RBC) and New-Keynesian models. These models argue that random shocks—new inventions, droughts, and wars, in the case of pure RBC models, and monetary and fiscal policy and international investor risk aversion, in more open interpretations—can trigger booms and recessions and can account for much of observed output volatility.

George McCandless works through a sequence of these Real Business Cycle and New-Keynesian dynamic stochastic general equilibrium models in fine detail, showing how to solve them, and how to add important extensions to the basic model, such as money, price and wage rigidities, financial markets, and an open economy. The impulse response functions of each new model show how the added feature changes the dynamics.

The ABCs of RBCs is designed to teach the economic practitioner or student how to build simple RBC models. Matlab code for solving many of the models is provided, and careful readers should be able to construct, solve, and use their own models.

In the tradition of the “freshwater” economic schools of Chicago and Minnesota, McCandless enhances the methods and sophistication of current macroeconomic modeling.

Accelerating energy innovation could be an important part of an effective response to the threat of climate change. Written by a stellar group of experts in the field, this book complements existing research on the subject with an exploration of the role that public and private policy have played in enabling—and sustaining—swift innovation in a variety of industries, from agriculture and the life sciences to information technology. Chapters highlight the factors that have determined the impact of past policies, and suggest that effectively managed federal funding, strategies to increase customer demand, and the enabling of aggressive competition from new firms are important ingredients for policies that affect innovative activity.

This book could be called “The Intelligent Person’s Guide to Economics.” Like Robert Heilbroner’s The Worldly Philosophers, it attempts to explain the core ideas of the great economists, beginning with Adam Smith and ending with Joseph Schumpeter. In between are chapters on Thomas Malthus, David Ricardo, Karl Marx, the marginalists, John Maynard Keynes, Friedrich Hayek, and Thorstein Veblen. The title expresses Duncan Foley’s belief that economics at its most abstract and interesting level is a speculative philosophical discourse, not a deductive or inductive science. Adam’s fallacy is the attempt to separate the economic sphere of life, in which the pursuit of self-interest is led by the invisible hand of the market to a socially beneficial outcome, from the rest of social life, in which the pursuit of self-interest is morally problematic and has to be weighed against other ends.

Smith and his successors argued that the market and the division of labor that is fostered by it result in tremendous gains in productivity, which lead to a higher standard of living. Yet the market does not address the problem of distribution—that is, how is the gain in wealth to be divided among the classes and members of society? Nor does it address such problems as the long-run well-being of the planet.

Adam’s Fallacy is beautifully written and contains interesting observations and insights on almost every page. It will engage the reader’s thoughts and feelings on the deepest level.

The current debate over the economics of advertising has long focused on two questions. The first concerns the impact of advertising on the relative positions of large and small firms in an industry and thereby on the state of competition. The second examines the role of advertising on consumer purchasing decisions over broad consumption categories. Comanor and Wilson use the modern tools of economic theory and statistics to build and test their hypotheses, and contribute important analytical and empirical evidence on the key issues.

The authors find that consumer decisions are affected substantially by the volume of advertising. Indeed, advertising is a weightier factor than relative prices. Their conclusions surely contribute to the nervousness long felt by economists over the use of consumer preferences to evaluate the welfare implications of resource allocation.

A Foreign Affairs Best Book of the Year

“An intellectual excursion of a kind rarely offered by modern economics.”
—Foreign Affairs

Thomas Piketty’s Capital in the Twenty-First Century is the most widely discussed work of economics in recent years. But are its analyses of inequality and economic growth on target? Where should researchers go from there in exploring the ideas Piketty pushed to the forefront of global conversation? A cast of leading economists and other social scientists—including Emmanuel Saez, Branko Milanovic, Laura Tyson, and Michael Spence—tackle these questions in dialogue with Piketty.

“A fantastic introduction to Piketty’s main argument in Capital, and to some of the main criticisms, including doubt that his key equation…showing that returns on capital grow faster than the economy—will hold true in the long run.”
—Nature

“Piketty’s work…laid bare just how ill-equipped our existing frameworks are for understanding, predicting, and changing inequality. This extraordinary collection shows that our most nimble social scientists are responding to the challenge.”
—Justin Wolfers, University of Michigan

In 1900 the global average life expectancy at birth was thirty-one years. By 2000 it was sixty-six. Yet, alongside unprecedented improvements in longevity and material well-being, the twentieth century also saw the rise of fascism and communism and a second world war followed by a cold war. This book tells the story of the battles between economic systems that defined the last century and created today's world.

The nineteenth century was a period of rapid economic growth characterized by relatively open markets and more personal liberty, but it also brought great inequality within and between nations. The following century offered sharp challenges to free-wheeling capitalism from both communism and fascism, whose competing visions of planned economic development attracted millions of people buffeted by the economic storms of the 1930s. The Age of Equality describes the ways in which market-oriented economies eventually overcame the threat of these visions and provided a blueprint for reform in nonmarket economies. This was achieved not through unbridled capitalism but by combining the efficiency and growth potential of markets with government policies to promote greater equality of opportunity and outcome. Following on the heels of economic reform, rapid catch-up growth in countries such as China, India, Indonesia, Brazil, and Poland helped to reduce global inequality.

At a time when inequality is on the rise in nations as disparate as the United States and Egypt, Pomfret’s interpretation of how governments of market economies faced the challenges of the twentieth century is both instructive and cautionary.

The noted economist Yair Mundlak presents here a theory of the growth of the agricultural sector within the context of a growing economy. He explores the various aspects of the dynamics of agriculture and their relationship to the dynamics of the economy at large, offering a unique blend of theory, methodology, and empirical analysis.

The rate of agricultural growth has varied across countries and over time, even though the main innovations in agricultural technology have been made available to all countries. Consequently, the difference in performance is due to the use made of the available technology. Mundlak treats the implementation of technology as an economic decision similar to decisions about resource supply and allocation. The development of agriculture, like that of other sectors, is determined to a large degree by the economic environment, especially public policies. This framework permits the author to evaluate the effects of policies on growth by examining their effects on sectoral incentives. Mundlak shows that neutral macroeconomic policies may have a stronger effect on sectoral growth than sector-specific policies.

The book contains problem sets, and will be a reference and text for graduate-level courses.

Richard Caves analyzes the market structure, conduct, and performance of the United States domestic passenger airlines. A unique aspect of the industry is the close regulation of its daily business functioning by the Civil Aeronautics Board. Although this influence affects every managerial decision, Caves finds that the economic elements in the industry's market structure still play a vital role in determining performance and conduct. He shows that the airline industry has structural characteristics that would ensure market performance of reasonable quality with less extensive economic regulation.

His book is more than a comprehensive evaluation of the air-transport industry; it is concerned with the basic question of governmental control. Questions of regulation, already materially affecting the American economy, are often before the public. Such industry studies as this clarify the net effect on the general economic welfare of industrial controls—how they work, where they work best, and the advantages of increasing or decreasing them.

This pioneering study of United States direct investment in Japan will interest academic specialists, business managers, and government policymakers in America, Japan, and elsewhere. Drawing on rich historical materials from both sides of the Pacific, including corporate records and government documents never before made public, Mason examines the development of both Japanese policy towards foreign investment and the strategic responses of American corporations. This history is related in part through original case studies of Coca-Cola, Dow Chemical, Ford, General Motors, International Business Machines, Motorola, Otis Elevator, Texas Instruments, Western Electric, and Victor Talking Machine.

The book seeks to explain why s little foreign direct investment has entered modern Japan. In contrast to the widely held view that emphasizes an alleged lack of effort on the part of foreign corporations, this study finds that Japanese restrictions merit greater attention. Many analysts of the modern Japanese political economy identify the Japanese government as the key actor in initiating such restrictions. Mason finds that the influence of Japanese business has often proved more potent than these analysts suggest. This book offers fresh insights into both the operation of the modern Japanese political economy and of its relations with the world economy.

A/Moral Economics is an interdisciplinary historical study that examines the ways which social “science” of economics emerged through the discourse of the literary, namely the dominant moral and fictional narrative genres of early and mid-Victorian England. In particular, this book argues that the classical economic theory of early-nineteenth-century England gained its broad cultural authority not directly, through the well- known texts of such canonical economic theorists as David Ricardo, but indirectly through the narratives constructed by Ricardo’s popularizers John Ramsey McCulloch and Harriet Martineau.

By reexamining the rhetorical and institutional contexts of classical political economy in the nineteenth century, A/Moral Economics repositions the popular writings of both supporters and detractors of political economy as central to early political economists’ bids for a cultural voice. The now marginalized economic writings of  McCulloch, Martineau, Henry Mayhew, and John Ruskin, as well as the texts of Charles Dickens and J. S. Mill, must be read as constituting in part the entities they have been read as merely criticizing. It is this repressed moral logic that resurfaces in a range of textual contradictions—not only in the writings of Ricardo’s supporters, but, ironically, in those of his critics as well.

In this study of the A & P. the author inquires into cost and price policy in one of America's large corporations, and examines the fact–finding process in government regulation of an industry.

The first part of the book treats the history of The Great Atlantic & Pacific Tea Company from 1919 to 1951 as a case study of a business management which is seeking to understand its market, formulate a rational price policy, and enforce the policy despite the inarticulate but effective opposition of subordinate executives. The second part deals with the buying methods of the company and A & P's relations with large and small suppliers. Particular attention is given to price discrimination.

In the final part of his study, Mr. Adelman discusses in detail the antitrust suit of the 1940's against the company and the goals and values implicit in that suit. He shows the way in which these goals predetermined the "facts" that purportedly were found. The author shows how a standard inductive–deductive method of economic research would have improved on the process of ”trial by slogan and cliché.“

In the midst of global recession, angry citizens and media pundits often offer simplistic theories about how bad decisions lead to crises. Many economists, however, base their analyses on rational choice theory, which assumes that decisions are made by well-informed, intelligent people who weigh risks, costs, and benefits. Taking a more realistic approach, the field of anthropology carefully looks at the underlying causes of choices at different times and places.

Using case studies of choices by farmers, artisans, and bureaucrats drawn from Michael Chibnik's research in Mexico, Peru, Belize, and the United States, Anthropology, Economics, and Choice presents a clear-eyed perspective on human actions and their economic consequences. Five key issues are explored in-depth: choices between paid and unpaid work; ways people deal with risk and uncertainty; how individuals decide whether to cooperate; the extent to which households can be regarded as decision-making units; and the "tragedy of the commons," the theory that social chaos may result from unrestricted access to commonly owned property.

Both an accessible primer and an innovative exploration of economic anthropology, this interdisciplinary work brings fresh insight to a timely topic.

Economists and theologians usually inhabit different intellectual worlds. Economists investigate the workings of markets and tend to set ethical questions aside. Theologians, anxious to take up concerns raised by market outcomes, often dismiss economics and lose insights into the influence of market incentives on individual behavior. Mary L. Hirschfeld, who was a professor of economics for fifteen years before training as a theologian, seeks to bridge these two fields in this innovative work about economics and the thought of St. Thomas Aquinas.

According to Hirschfeld, an economics rooted in Thomistic thought integrates many of the insights of economists with a larger view of the good life, and gives us critical purchase on the ethical shortcomings of modern capitalism. In a Thomistic approach, she writes, ethics and economics cannot be reconciled if we begin with narrow questions about fair wages or the acceptability of usury. Rather, we must begin with an understanding of how economic life serves human happiness. The key point is that material wealth is an instrumental good, valuable only to the extent that it allows people to flourish. Hirschfeld uses that insight to develop an account of a genuinely humane economy in which pragmatic and material concerns matter but the pursuit of wealth for its own sake is not the ultimate goal.

The Thomistic economics that Hirschfeld outlines is thus capable of dealing with our culture as it is, while still offering direction about how we might make the economy better serve the human good.

Whether you are selling a house, closing a business deal, settling a divorce, arbitrating a labor dispute, or trying to hammer out an international treaty, Howard Raiffa’s new book will measurably improve your negotiating skills.

Although it is a sophisticated self-help book—directed to the lawyer, labor arbitrator, business executive, college dean, diplomat—it is not cynical or Machiavellian: Raiffa emphasizes problems and situations where, with the kinds of skills he aims to develop, disputants can achieve results that are beneficial to all parties concerned. Indeed, he argues that the popular “zero-sum” way of thinking, according to which one side must lose if the other wins, often makes both sides worse off than they would be when bargaining for joint mutual gains.

Using a vast array of specific cases and clear, helpful diagrams, Raiffa not only elucidates the step-by-step processes of negotiation but also translates this deeper understanding into practical guidelines for negotiators and “intervenors.” He examines the mechanics of negotiation in imaginative fashion, drawing on his extensive background in game theory and decision analysis, on his quarter-century of teaching nonspecialists in schools of business and public policy, on his personal experiences as director of an international institute dealing with East/West problems, and on the results of simulated negotiation exercises with hundreds of participants.

There are popular books on the art of winning and scholarly books on the science of negotiation, but this is the first book to bridge the two currents. Shrewd, accessible, and engagingly written, it shows how a little analysis sprinkled with a touch of art can work to the advantage of any negotiator.

For over forty years the Harvard Institute for International Development (HIID) has worked with countries in the developing world on the complex issues of economic and social reform. This volume describes the experience of the Institute in the challenging development assistance world of the 1980s and early 1990s, when HIID's largest projects involved work with countries attempting to move away from high levels of government intervention to more market-friendly systems. These efforts involved work in formerly centrally planned command economies (e.g., Russia, Vietnam, etc.) as well as in the mixed plan/market economies of Asia, Africa, and Latin America. The book also describes HIID's efforts in education and health reform as well as in the rapidly expanding area of environmental economics and policy.

Assisting Development in a Changing World is an unvarnished account written by the HIID practitioners who participated in these programs and edited by its former director and executive directors.

Economists make confident assertions in op-ed columns and on cable news—so why are their explanations often at odds with equally confident assertions from other economists? And why are all economic predictions so rarely borne out? Harnessing his frustration with these contradictions, Jonathan Schlefer set out to investigate how economists arrive at their opinions.

“A lucid, plain-spoken account of the major economic models, which [Schlefer] introduces in chronological order, creating a kind of intellectual history of macroeconomics. He explains what the models assume, what they actually demonstrate—and where they fall short.”
—Binyamin Applebaum, New York Times blog

“Fascinating...[Schlefer’s] book is a tough critique of economics, but a deeply informed and sympathetic one.”
—Justin Fox, Harvard Business Review blog

“This book is an impressive and informative analysis of the economics literature—and it presents some useful insights about how a more eclectic, catholic approach might allow economics to progress more convincingly into the future.”
—Michelle Baddeley, Times Higher Education

“The Assumptions Economists make [is] a knowledgeable...broadside against neoclassical economics...Schlefer’s gripes concern model-building run amok...His criticisms of these models are original and sophisticated.”
—Christopher Caldwell, Literary Review