Macroeconomics

The book is by no means perfect, but it's a darn good book. Its major imperfection is that many important concepts are spread around and not specifically brought to the forefront alone. Otherwise, though, it allows for a great foundation in Macroeconomics for your GECO 200 or equivalent class.

This book gives a great overview of the study of economics. I used it for an Introduction to Global Economics class in college and found it to be easy to read and understand. The information is extremely up-to-date, and is displayed not only through text, but by charts and graphs as well. There also additional materials (practice test questions, a CD rom, and a guide to researching economics on the internet) which accompany the text which are available as well. Overall, a great book for the study of basic economics!

Can statistical physics methods be used to help understand and predict the behaviors of groups of people over time? Aoki, a well-known expert in optimal control theory and dynamic models applied to economic models, suggests that they can. This book offers an inspiring medley of technical ideas and probabilistic models -- based on analogies to spin glasses, self-organizing physical systems, and key ideas of statistical mechanics -- to make plausible the idea that behaviors of aggregates of rational actors, too, can be predicted statistically. (Enthusiasts of Isaac Asimov's Foundation series, take note!)

The book is worth studying carefully for its ideas and models, even though its main thesis may not ultimately be convincing. It presents and illustrates modeling techniques that will be useful to marketing scientists and quantitative social scientists as well as to economists. A central idea is that individual behaviors can be represented by transitions among discrete choices or microstates, while the rates at which these transitions take place may depend on the frequency distribution of the whole population (and/or of local subpopulations)among microstates. The result is an adaptive process in which individual choices define the aggregate macrostate (i.e., the frequency distribution of individuals of various distinguished types among microstates), which in turn affects subsequent choices. Whether this adaptive process will reach any equilibrium, and, if so, which one and how and when, are principal concerns addressed through various well-analyzed models.

The techniques introduced and illustrated are primarily, partition function and stochastic process methods, including jump processes, diffusion processes, and martingale methods. Other ideas, from critical process theory, stochastic epidemics, large deviations, and maximum entropy econometrics and physics, are introduced and exploited where appropriate. The practical value of such methods to modelers cannot be denied. Aoki's main theme, that such techniques can be used to predict behaviors of populations of individuals, is not buttressed by any real applications. The models presented may be too simple to capture what many social scientists would consider essential real-world complexities, such as the generation of new player types and roles and the effects of boundaries and spatial distributions of resources and environments on populations over time. Nonetheless, the collection of ideas and methods presented, and the overall vision of a social science in which inter-individual heterogeneities and choices are accounted for by discrete transitions, makes this monograph exciting and valuable.

Note: Readers who enjoy this book may also want to read T.C. Schelling's Micromotives and Macrobehavior. Schelling's book is much less technical, but follows some of the same big ideas and applies them to many homely, compelling examples.

Content: 1 Introduction 2 Simple Illustrative and Motivating Examples 3 Empirical Distributions: Statistical Laws in Macroeconomics 4 Modeling Interactions I: Jump Markov Processes 5 Modeling Interactions II: Master Equations and Field Effects 6 Modeling Interactions III: Pairwise and Multiple-Pair Interactions 7 Sluggish Dynamics and Hierarchical State Spaces 8 Self-organizing and Other Critical Phenomena in Economic Models Elaborations and Future Directions of Research Appendix References Index

Though politics and economics continue to be the two most influential forces in our society, the discussion relating the two is often lofty and incomprehensible to common men. Drazen eases the burden of confusion by providing distinct discussion and wonderfully elaborated points of concern. A great tool for understanding politicla economy.

Numerous issues concerning conflict of interest and strategic behavior are involved in political matters and economic policy decisions in particular, and in macroeconomic outcomes in general. Allan Drazen presents the most complete analysis of the literature concerning these issues, both from a theoretical and an empirical perspective. I think this book is the Blanchard and Fischer's of Political Economy. Superb.

"Wealth in America" is a fascinating book, examining not only the state of wealth as it stands presently, but also looking at trends over time. The first chapter looks at what wealth is, how it has been studied to date, and then presents how the rest of the book is structured. The second chapter looks at the various studies available on wealth, the issues that arise with wealth measurement, and the pros and cons of the models that the author will use throughout the book. It is these simulation models that render this book unique, allowing the author to consider various trends and examine different possibilities that could otherwise only be speculated about.

For the general reader, things get interesting in chapter three: Here we take a look at who owns how much, in what categories, as well as different general trends over time and up and down the wealth scale. Chapter four focuses on the wealth of the very rich: the composition of their wealth and liabilities, the characteristics of wealthy households, and the effect that race has on wealth accumulation. Chapter five looks at the middle class and the poor. The bar graph on page 125 really brings home how little of the assets the bottom 90% of the population controls versus the top ten percent. Chapter six looks at how baby boomers have fared in comparison to their parents and projects how they may do in their coming retirement years. Chapter seven looks at the role of stock market and real estate fluctuations on wealth holdings, as well as the impact that government policies can have. Chapter eight focuses on the impact that age, race, education and other life events have on wealth accumulation and ownership. Chapter nine examines the prospects for moving from one segment of wealth ownership to a greater or lesser one. The final chapter then wraps up with some general conclusions.

Through out the book, the author is explicit about her use of simulation models to make projections as to where different trends might take us. However, when possible, the author is also very careful to also compare her models against actual data, so that it is clear that the discrepancies are minor. I would have liked to have seen a greater breakdown of the assets and liabilities of the middle class and poor, as well a greater examination of their saving and accumulation behavior (or lack of), but perhaps this is material for another book.

This book is not easy reading, but for someone who is willing to put in a little effort, this book contains a treasure trove of information on wealth that is not readily found elsewhere. I would certainly recommend it to someone with an interest in the subject.

In this scholarly and provocative book, Lisa Keister argues that social scientists have been so caught up in studying occupational mobility and income attainment that they have missed the central feature of the social landscape in America: wealth is extremely unequally distributed and shows little sign of being redistributed equally. In 1995, the top 1% of wealth owners owned about two-fifths of net worth and nearly half of all financial wealth. By contrast, the bottom 60% owned less than 5% of net worth and had basically NO financial wealth.

Keister painstakingly assembled a massive data set from various surveys and government reports, covering the period 1962-1995. In addition to analyzing the actual data, she also built simulation models that allowed her to model the processes underlying changes over time. The simulation models also allowed her to perform "what if" scenarios. For example, she showed that the very high threshhold for estate taxes is probably the single biggest contributor to the perpetuation of wealth inequality across generations. She was also able to show that, contrary to what many commentators have claimed, the baby boomer generation adopted various strategies that have enabled them to do better, economically, than their parents.

I highly recommend this book to scholars interested in trends in wealth inequality, and to public policy makers who might wish to do something about it. Keister relegated much of the technical details to an Appendix, but the book will still be heavy going for the statistically challenged. Nonetheless, upper level college and graduate students taking courses in social inequality, political economy, public policy, social and economic justice, and related fields would benefit enormously from reading this book.

Mathematics is used broadly in the book but limited to simple algebra, i.e., no calculus is used. So the level thus is appropriate for an introductory economics class.

The text is of medium reading level, although sometimes the extensive introduction to terms is unavoidable in introductory texts. That is to say, we can find pages with five or six terms crowded together, but that's what happens to almost every introductory textbook and generally expected when you touch a new subject at the first time.

This book helps me alot in my jop and in my life.

This book is an excellent source for understanding the major principles of economics. It seems more geared towards those people who want a general but accurate working knowledge of economic topics, especially since it shuns use of mathematics like the plague. It is this fact however, that makes the book less useful to the intermediate and higher level student of economics who just wants topics explained in as clear a way as possible, but then also wants to see the mathematical methods involved in these areas. Nonetheless, this is the first economics book that I have ever read that has such a high level of lucidity and clearness to it.

This book took an otherwise dull subject and made it interesting. This was the 3rd economics book that I read, and I found this one to be the best.

If you read only one book on economics, read this. It deals clearly and concisely with the substance of economics and with the economists' approach -- an approach that far too few people appreciate, and which this book will instil in you. Claims that the book does not have enough math and does not cover Keynesian macroeconomics are misguided.

Regarding the supposed lack of math, one must remember that math is merely a tool that should be used to clarify and not confuse economics. If one can explain economics in English, so much the better. Economics needn't be hard. Mankiw's economics is at least as good as the best of the harder and more mathematical textbooks, and better than the rest. The need is for good economics to be explained well to a large audience, and this book does it superbly.

Regarding the exclusion of Keynesian short run macroeconomics, all I can say is "Whew! Finally! At last!". Keynesian short run macroeconomics taught at the undergraduate level is mindless, unintuitive curve pushing and generates neither understanding nor love for the subject. Teaching that (especially in a first course to a general audience!) is absolutely unforgivable. If anyone is married to Keynesian economics, they can use Mankiw's "Macroeconomics" which covers with exceptional clarity and brevity all the standard material in an intermediate macro course including the ugly Keynesian short run macroeconomics. However, I am against such an approach. The proper way would be to do Mankiw's "Principles of Economics" in the introductory course and then cover the market-clearing approach to macroeconomics of Barro's "Macroeconomics" in the intermediate macroeconomics course.

This book is definitely not worth its price. Basic option theory and knowledge on VAR is wrongly interpreted. The book gives no insight on what energy risk management realy stands for. Utterly disappointed !

This book provides an excellent background and review in easy to understand language about energy trading and energy risk management. I highly recommend it for understanding the basics of this complex subject. It also provides a global overview of market developments. It is not, however, a quantative treatise on energy and financial derivatives. This is a primer that should be viewed as such.Fusaro's second, Energy Derivatives: Trading Emerging Markets, is the companion piece to this book and adds the newer commodities of weather, emissions, bandwidth and coal derivatives. I recommend it as well.

Until Peter Fusaro's book "Energy Risk Management" hit the bookstores in 1998, anyone needing a clear explanation of how risk is managed in the energy markets had to sift through numerous trade publications and journals.

This was genergally the reaction of any industry participant I spoke to, independently of whether they were clients, students or collegues of mine both from the Energy community or from academia. Therefore, with this feedback, I would strongly encourage my collegues to read Peter Fusaro's new book "Energy Derivatives: Trading Emerging Markets" which he edited with Jeremy Wilcox and was published in October of this year. In this book Peter Fusaro and his team of energy professionals take the reader deeper into the secondary markets (energy derivatives, etc.) which have emerged as a result of the deregulation process of the Energy Industry and, most importantly, the book explains how to use these markets to manage energy risk. Further, in chapter 3, 4, 5 and 6 the reader is introduced to the concept of interdependency among energy markets and other related markets. These include weather and weather derivatives, emission trading and bandwidth - the most recently emerging market converging with Power to become the backbone of the new global economy. This is the first book to address the complex topic of convergence of power and the rapidly growing bandwidth market. For this reason alone this book becomes a must for everyone who is interested in becoming a part of the evolving energy market.

If you pay even casual attention to consumer trends, you may well have noticed that "premium" goods and services are thriving in practically every category -- Panera sandwiches, Sub-Zero refrigerators, Starbucks coffee, Callaway golf clubs, BMW cars. And if you pay any attention to economic trends, you probably won't be surprised to hear that the top fifth of American households ranked by income saw their earnings rise faster than any other group between 1970 and 2000 -- by 70%, in fact, in real dollars -- and now control 63% of the country's net worth. Finally, most observers of social behavior probably have a sense that it's not just the top fifth buying "new luxury" goods: Practically everyone is willing to pay a premium in at least one category, partly because shopping is now a source of emotional fulfillment and meaning for many.

All this has been written about before, both by those who applaud the democratization of luxury and taste and by those who deplore the democratization of selfishness and conspicuous consumption. Michael J. Silverstein, of the Boston Consulting Group, and Neil Fiske, his former colleague and now the president of Bath & Body Works, are in the applauding camp. Their "Trading Up: The New American Luxury" waves away the likes of Juliet Schor's "The Overspent American" and assures us that the "New Luxury is good news for America" because it "offers a new kind of emotional engagement" to consumers and gives business leaders "a new way to think about growth, profitability, and the art of fulfilling dreams."

The business leaders are the target readers, as the book is set up to help them cash in on the trend. Along the way, "Trading Up" offers plenty of ammunition to naysayers: Messrs. Silverstein and Fiske draw on many interviews with New Luxury consumers, and they often come across as fairly shallow and unpleasant people. "The quality of our appliances represents us," one woman declares after bragging about her kitchen setup. Other women talk about spending their way through breakups in bouts of therapeutic or "revenge" shopping. A Callaway fan bluntly tells the authors that "I feel good, I feel equal" when his fancy clubs help him beat them at golf. "I may make a lot less money than you do, but I think I have a better life." Later the same guy explains another of his "luxury" habits this way: "When I'm on a date, if I say 'Give me a Sam Adams,' I know she knows I'm special and I have some taste." If that's true, it probably says more about his taste in women than in beer.

Whatever you make of the pros and cons of the trend, Messrs. Silverstein and Fiske have gathered a slew of case studies and some fascinating material. While the emotional component of shopping and marketing is something others have addressed, it's still surprising to find that it apparently applies even to such workaday items as the washer-dryer. The authors say that they spoke to owners of Whirlpool's premium-priced Duet model and "found an emotional connection stronger than we have seen in any other category." Whirlpool, they add, is now pursuing a "laundry room as family hub" strategy.

More broadly, "Trading Up" is probably onto something when it notes that the willingness of consumers to pay a premium in some categories makes them price-sensitive in others. Thus offerings in the middle range (neither luxuries nor bargains) get squeezed. The authors are also wise to stress "the collapse of the innovation cascade": The differentiations in style or technology that mark luxury goods can quickly become standard features throughout entire categories, upping the pressure to innovate again if you want to stand out.

Messrs. Silverstein and Fiske frequently return to the idea of the emotional connection between consumers and their purchases, but one interesting aspect of this they hint at but never quite say aloud. There seems to be a conundrum built into the "trading up" idea. A major theme among the entrepreneurs in the book is that, as one puts it, "sophistication and taste are now within reach of the middle class." Yet the one characteristic that nearly all the model companies seem to enjoy is high profit margins. Shouldn't "sophisticated" or "savvy" (a word the authors apply to younger New Luxury adherents in particular) consumers and high margins have trouble co-existing?

Emotion, presumably, is the key. Something stronger than logic has to come into play if you're going to get your customers to swallow a big markup. Think back to that Callaway fan -- he didn't say that he is equal to the authors and has a better life. He said he feels equal and thinks he has a better life. Perhaps that was a slip of the tongue. Or perhaps he is the savviest man in the book.

Silverstein & Fiske do a great job of explaining the apparent dichotomy of BMW's in the Wal-Mart parking lot. Chapter 3 is a great primer for how to market New Luxury. I have read chapter 3 a few times and I keep getting more out of it. This book more clearly explains consumer marketing than the textbooks I read in business school. The book would have been more valuable if they considered how to apply this thinking in a "B to B" environment. Overall, an excellent read but don't take my word for it, visit the Boston Consulting Group web site and download Chapter 1 to get a taste. I bet you will come back here and buy it!

Trading Up is the first business book I've read that not only provides useful insights for my company but also speaks to my life as a consumer. The book makes me understand why I, my family and friends spend the way we do -- and how my company can begin to position products and services so people spend more on them. Furthermore, the book makes you realize that materialism -- being obsessed with things and willing to pay for them -- is good and healthy for the spender, the economy and the country. Trading Up is a very useful read.

I guess this is what passes for a thoughtful review of the tax code for a liberal. I'm sure the author has no desire to give "tax breaks" to individuals any more than those greedy corporations. Besides attacking expense deductions as a "tax break," the class-warfare demagoguery always ignores the ultimate beneficiary of tax breaks to corporations, which are the company's workers and its stockholder. Oh yeah, the stockholders are just greedy rich people anyway, right?

Before the welfare reform bill of 1996, genuine welfare was about 130 billion dollars per year, including food stamps, AFDC, housing assistance, WIC, Head Start, Low-income energy assistance, JOBS, Legal Services corporation, Medicaid, SSI, Pell grants, and the EITC. Altruistic behavior, of course, enrages conservatives, along with legitimate concerns, such as the Department of Education losing 450 million dollars in a three year time frame.

Meanwhile, the rich are quietly gorging at the trough.

The authors discover that "wealthfare" -- the money we hand out to corporations and wealthy Montgomery Burns types -- is at LEAST 448 BILLION dollars a year. To ensure not being accused of "bias," they consistently use conservative figures, thus leaving the real number far greater.

Their presentation is effective. Well cited, they address the orgy of waste and fraud in the "neglected" Pentagon, Social Security inequities generated from Reagan's sneaky regressive mega-tax hike on working people, phony accelerated depreciations (e.g. the NEGATIVE tax rates many corporations get away with), the S&L bailout we're still paying for, subsidies to nuclear, mining, timber, gas, oil, aviation, handouts to the media giants, insurance loopholes, and much more! Quite a lot for such a little book. A job well done!

This IS the "pinko's" view of the tax code. After all, it's socialism for the rich, capitalism for the poor....

The next time some smug nabob starts muttering under his/her breath about the drain on our economy caused by the proverbial 'welfare mother' (you know, the one that's driving the Cadillac), you can put em' in their place armed with the wealth of info contained in this short but well written little book.

As 'Take the Rich Off Welfare' aptly points out, welfare really does suck a lot of money from our treasury, but it's not the poor and needy in this country that benefits from this bonanza. As a matter of fact the word 'wealthfare' is more applicable, because that's who's really benefiting- the wealthy.

Very brief, but meticulously researched and with sources to back up every fact, 'Take the Rich off Welfare' is a great introduction to the big wide world of graft in America. If you've ever been curious about who has their foot in the back door of the treasury- check out this fine book.

I regret to say that this is not a good accompaniment for my graduate macroeconomics class. I thought I could somehow get some mileage out of this book, but as I read it I found out that its lack of technical details and rigor make my lecture notes look superior. I was misled to think that this is a great textbook through the early positive reviews below, that's why I bought it. Nevertheless, the empirical content is more than enough to satisfy one's curiosity, but I think it is not worthwhile to study advanced macroeconomics without learning fully the necessary theories and the accompanying mathematical techniques. This textbook must not be the choice for a core graduate level macroeconomics class; it's wordiness is comparable to the undergraduate textbook "Intermediate Microeconomics" text by Varian. It is readable of course, when you want to pass the time, but it won't do for a graduate level text. I'm disappointed because this is the second edition already but still the author stuck to the same way of presentation. Perhaps the only differences between the first and the second edition are the empirical data sets and a new chapter and nothing else. The first three chapters and chapter 7 of Obstfeld and Rogoff's treatise, "Foundations of International Macroeconomics," Barro and Sala-i-Martin's, "Economic Growth," and the chapters 2,3 and 4 of Blanchard and Fischer's, "Lectures in Macroeconomics," provide a more comprehensive view of modern acroeconomics.

This has to be the world's most overused textbook. I have used it in no less than four semester-length courses, two undergraduate and two graduate. So obviously I am sick to death of this book, but I hated it the first time anyway. The book's title is completely misleading; its treatment of all subjects is extremely simplistic. This text might be appropriate for second-year undergraduates, but that's all. The mathematical content is pathetic. For instance, the concept of intertemporal optimization plays a key role throughout the text, but there is virtually no treatment of the calculus of variations, and no treatment of stochastic dynamic programming whatsoever. Thus, the core of this theory is gutted, and we only get a dumbed down version that is palatable enough for Romer's text to sell well with math-averse undergrads. I thought the Stokey-Lucas text was great for its use of recursive methods as a unifying concept. Well, the only unifying concept in Romer's book is the formula for a geometric sum; this will get you through about half of the problems. The scope of Romer's text is not just new classical macro, though; he also surveys Keynesian macro and other topics. (Actually the best thing about this book is that Romer is a relatively unbiased author, plus he surveys a lot of empirical evidence.) Once again his treatment of Keynes is ultra-simplistic - he takes the usual "sticky-prices" interpretation which misses the subtleties in the GTEIM. This time it is not the absence of mathematical rigor that lets Romer down, but simply his failure to address the important issues. Any reading of the GTEIM and related literature will verify this. My view is that any graduate course on macro should use one of the serious texts on new classical macro in conjunction with readings from original books/papers on other macro paradigms, and not use Romer.

There can be no question that Romer's text-book is an outstanding tome. However, I'm sure most reviewers would agree with me when I say that economists tend to have a love/hate relationship with this book. We love this book because of the breadth of topics covered and the quality of Romer's analysis and exposition. His discussion of dynamic inconsistency is the best I've seen, and the opening chapter on the Neo-classical growth model sets the standard to this day.

A fellow reviewer observed that complaints concerning Romer's penchant for "trivial" mathematics were misplaced because the technicality of modern macroeconomics precludes the possibility of discussing the issues in any other way. I agree. But I think a fairer assessment would be that there are instances where Romer could develop the mathematical underpinnings in a more consise way. The best example is the second chapter on the Ramsey growth model. The easiest way to understand this model is by using optimal control/dynamic programming techniques - which is how it is taught on most graduate courses. Romer's decision not to follow this route is probably borne of a desire to make the book more accessible to undergraduates - who are unlikely to come across these methods. Whatever the intention, the result is an exposition that confuses more than enlightens. Would it not have been better to include a good coverage of optimal control techniques in the appendix?

Nevertheless, an excellent book.