《Modern Economics》

Preface9

CHAPTER Ⅰ Three Trends in Modern Economics11

1．What is modern about modern economics？11

2．Macro versus micro14

3．Keynesianism17

4．The revival of classical theory22

5．Quantitative thinking24

6．The set-up of this book29

CHAPTER Ⅱ Productive Capacity Determines National Income：The Classical Theory33

1．Say＇s Law33

2．The productivity of labour determines prosperity37

3．The capacity effect and the income effect of investments42

4．The classical system45

CHAPTER Ⅲ Total Expenditure Determines National Income：Keynes＇s Theory49

1．The breaking of Say＇s Law49

2．The propensity to save and the multiplier55

3．Is Keynesianism depression economics？60

4．Is hoarding or saving the cause of unemployment？65

CHAPTER Ⅳ How do we Build a Model？69

1．Logical and quantitative models69

2．The simple Keynesian model71

3．What determines investment？78

4．The stability of national income83

CHAPTER Ⅴ The Impact of International Trade90

1．The classical view of the balance of payments90

2．The income effect of exports94

3．The model becomes more complete97

4．The rate of exchange dethroned？101

5．The international economy105

CHAPTER Ⅵ The Role of the Budget108

1．Government expenditure，taxes，and national income108

2．Budgetary equilibrium113

3．Functional Finance116

4．The national debt119

5．The Haavelmo effect123

6．Is Functional Finance a danger？126

CHAPTER Ⅶ Old and New in the Theory of Money130

1．What is the theory of money？130

2．The income sphere and the capital sphere136

3．Models with and without the effect of money141

4．A synthesis149

5．Monetary policy：essential or non-essential？154

CHAPTER Ⅷ The Value of Money160

1．The value of money and the price level160

2．The quantity theory163

3．The＇encounter＇theory167

4．The cost theory169

5．The government＇s price policy174

CHAPTER Ⅸ The Wage Level in the Model178

1．Wage problems178

2．The effect of wages on employment181

3．What determines the wage level？187

4．An incomes policy？192

CHAPTER Ⅹ Economic Growth197

1．The topicality of growth theory197

2．The classical growth function and steady growth199

3．The Neo-Keynesian growth equation205

4．Stability and the growth paradox209

5．Growth and structural changes212

6．The dangers of growth216

CHAPTER Ⅺ Fitting the Jigsaw Together223

1．Ten equations223

2．Some of the model＇s properties226

3．What do we do with the model？231

4．Planning236

5．quantification241

CHAPTER Ⅻ Economic Steersmanship248

1．The combination of policy instruments248

2．Equilibrium policy and politics252

3．The wrongheaded opposition256

4．An economic policy for the coming decades261

EPILOGUE267

A Short Glossary269

Note on Further Reading273

Index of names275