The Economics Book

219 The people of the Bahamas score very highly in the Satisfaction with Life Index, which was devised by British psychologist A ...

220 POLICIES TO CORRECT MARKETS CAN MAKE THINGS WORSE THE THEORY OF THE SECOND BEST S tandard economic theory holds that where m ...

221 See also: Free market economics 54–61 ■ Economic equilibrium 118–23 ■ External costs 137 POST-WAR ECONOMICS or remove it. Th ...

222 MAKE MARKETS FAIR THE SOCIAL MARKET ECONOMY I n the aftermath of World War II West Germany had to rebuild its economy and po ...

223 East and West Germany reunified in 1990, a year after the fall of the Berlin Wall (right). East Germany abandoned its centra ...

224 OVER TIME, ALL COUNTRIES WILL BE RICH ECONOMIC GROWTH THEORIES I n the 1950s US economist Robert Solow devised a model of ec ...

225 Cyclists in Beijing, China, eye a Ferrari parked in the cycling lane. China and India have joined the club of converging (“c ...

GLOBALIZATION IS NOT INEVITABLE MARKET INTEGRATION ...

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228 G lobalization is a term that means different things to politicians, business people, and social scientists. To an economist ...

229 in west Paris was higher, sellers of carrots would move from the east to the west and prices would equalize. The price of ca ...

230 Improvements in transport have been a major driver in globalization. In Shanghai, China, the US has invested in a gigantic “ ...

POST-WAR ECONOMICS 231 Nations may want democracy, independence, and deep global economic integration. Yet at any one time, only ...

232 SOCIALISM LEADS TO EMPTY SHOPS SHORTAGES IN PLANNED ECONOMIES A fter an initial dramatic rush of growth after World War II t ...

233 See also: Free market economics 54–61 ■ Marxist economics 100–05 ■ The competitive market 126–29 ■ Central planning 142–47 ■ ...

WHAT DOES THE OTHER MAN THINK I AM GOING TO DO? GAME THEORY ...

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236 C onsidering how another person might react when you do something involves making strategic calculations. Successfully negot ...

237 what they thought the other firm was going to do, but this was an isolated case of analyzing strategic interactions. In 1944 ...

238 to research areas such as game theory, which was seen to be particularly relevant to the politics of the Cold War. In 1950, ...