Microeconomics (9th Edition)

Author: Mansfield
Publisher:
Publish Date: 2003-01-01
Features: This textbook is now in its ninth edition, but it still shares the same purpose as the edition: to explain microeconomic theory as clearly and interestingly as possible, and to demonstrate its broad practical applications. However, due to the progress of the theory itself and changes in its applications and teaching methods, we have made substantial revisions to each chapter. In this new edition, we have added two chapters—one discussing the role of competition in promoting economic efficiency (and the role of government intervention)—and another explaining how asymmetric information affects the behavior of buyers and sellers in markets. Below, we briefly describe these two chapters and other additions and changes:
1. Immediately following the discussion of perfect competition, we have added a chapter on the role of government intervention, Chapter 10. In this chapter, we provide an initial examination of how perfect competition promotes economic efficiency and the impact of government intervention. For students, it is crucial to understand how competitive markets respond to such interventions and to be able to (at least roughly) estimate the gains and losses for consumers and producers resulting from them. The analytical tools (and several real-world case studies) provided in this chapter help students develop this ability.
2. The other newly added chapter is Chapter 18 on asymmetric information. In this chapter, we discuss how asymmetric information affects the behavior of buyers and sellers in markets. Our findings can explain various phenomena in modern economics—from the disproportionate number of lemons in used-car markets to the widespread unemployment in labor markets. Additionally, our results illustrate why market failures can occur in a perfectly competitive economy when asymmetric information exists.
3. This edition includes a new cross-chapter case study: "FCC and the Global Largest Auction." This case study examines the Federal Communications Commission (FCC) auction for wideband personal communication service licenses in May 1995 and the auction for narrowband personal communication services in 1994. The FCC auction is a milestone in the application of microeconomic theory.
4. To accommodate the additional content, we have condensed the discussion of input prices and quantities and placed it in Chapter 14. In the previous edition, this content occupied two chapters, but now it has been condensed into one.
5. We have added several new topics. For example, in Chapter 12, we have included the Stackelberg model and the Bertrand model; in Chapter 13, we introduce the concept of game trees and discuss the largest size strategy.
6. We have added many new examples. Notably, the following examples are new:
(1) The invasion of Manhattan by coffee shops;
(2) Cotton prices: the highest level since the Civil War;
(3) Are CEOs of large companies really worth $26 million a year?
(4) The highest price cap on gasoline;
(5) Milk price support;
(6) Should gasoline taxes be raised?
(7) Playing slot machines at Foxwoods;
(8) The tire retail market;
(9) Neil Simon to Broadway;
(10) Asymmetric information in the fixed-line market;
(11) "Lemons" in pickup trucks and baseball players;
(12) Dillard's, McDonald's, and the importance of reputation.
7. The end-of-chapter problems have been increased, and many of the existing problems have been revised to make the discussion more up-to-date. From Chapter 1 to Chapter 19, changes have been made to figures, tables, text, and notes, and every sentence has been reviewed with a critical eye. Since its first publication in 1970, this book has been continuously revised and is now in its ninth edition. It provides a profound and systematic exposition of the fundamental principles and methods of microeconomics, reflecting the theoretical developments of recent decades. At the same time, it combines numerous examples and case studies to highlight the broad practical applications of microeconomics. It is a widely acclaimed intermediate microeconomics textbook in the West.