The Economics Book

159 going wage. Classical economists believed that markets were flexible enough to adjust and bring down real wages. But Keynes ...

160 DEPRESSIONS AND UNEMPLOYMENT will not fall by the level required to remove the unemployment. In this way the unemployment is ...

WAR AND DEPRESSIONS 161 Classical resurgence Keynesianism became discredited in the 1970s as European economies ran into trouble ...

162 SOME PEOPLE LOVE RISK, OTHERS AVOID IT RISK AND UNCERTAINTY T here is an element of risk in any business venture or investme ...

163 Traders in a futures market in São Paulo, Brazil, are effectively betting on the future movements of commodity prices. Even ...

164 GOVERNMENT SPENDING BOOSTS THE ECONOMY BY MORE THAN WHAT IS SPENT THE KEYNESIAN MULTIPLIER Government spending boosts the ec ...

165 Vast infrastructure projects, such as the Three Gorges Dam, China, can create thousands of jobs. The new workers’ wages then ...

166 ECONOMIES ARE EMBEDDED IN CULTURE ECONOMICS AND TRADITION E conomists believe that people are rational, in that they will ta ...

167 See also: Economic man 52–53 ■ Religion and the economy 138–39 ■ Institutions in economics 206–07 ■ Social capital 280 WAR A ...

168 MANAGERS GO FOR PERKS, NOT THEIR COMPANY’S PROFITS CORPORATE GOVERNANCE M ost people assume that the basic principle of a fr ...

169 See also: Public companies 38 ■ Free market economics 54–61 ■ The competitive market 126–29 ■ Institutions in economics 206– ...

170 See also: Measuring wealth 36–37 ■ Inflation and unemployment 202–03 ■ Financial engineering 262–65 ■ Complexity and chaos 2 ...

171 See also: Demographics and economics 68–69 ■ Opportunity cost 133 ■ Markets and social outcomes 210–13 ■ Shortages in planne ...

WE WISH TO PRESERVE A FREE SOCIETY ECONOMIC LIBERALISM ...

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174 for private property, and deep pessimism about the ability of governments to shape society. Creating dictatorships The argum ...

175 The totalitarian state of North Korea suffers regular shortages and famine. Economists of the Austrian School claim that thi ...

176 ECONOMIC LIBERALISM The free flow of information between individual sellers and vendors (left) results in the correct pricin ...

177 Auctions are free markets where prices arise from the direct and rapid exchange of localized information between buyers and ...

178 INDUSTRIALIZATION CREATES SUSTAINED GROWTH THE EMERGENCE OF MODERN ECONOMIES T he Russian-born economist Simon Kuznets descr ...