Economics

Current economic problems continue to be the dominant feature in this second edition of Economics, but the updating is accompanied by other noticeable changes. Seven chapters are entirely new, and many others have been completely rewritten. More important, several new themes are developed and continually emphasized throughout the book. As before, Economics maintains a balance between concepts and topical applications, which are closely interwoven throughout the book-espe cially in the commentaries at the end of each chapter.

In the first edition, the balance between concepts and applications was achieved by the unifying theme of efficiency versus equity. Although this edition maintains that theme, it also propounds several others. The most significant theme is the role of government in the economy and the frequent failure of governmental action to achieve its goals. The book dwells on the principle that how government intervenes in the economy is as important as whether it intervenes. It explains the necessity of considering the total impact of governmental action, not just its most obvious conse quences. Public policy is analyzed in terms of its impact on resource allocation, stability, and income distribution. As we show in this discussion, the political side of the distributive impact of government is especially influential.