Ebook: The ABCs of political economy: a modern approach

"The ABCs of Political Economy is an accessible introduction to modern political economy. While informed by the work of Marx, Keyens, Veblen, Kalecki, Robinson, Minsky and other great political economists, the ABCs provides readers with essential tools needed to understand economic issues today from a modern perspective. Dispelling myths about financial liberalization, fiscal austerity, globalization and free markets, the ABCs offers a critical perspective on our present system and outlines clear alternatives for the future. This second edition applies the analytical tools developed to help readers understand the origins of the financial crisis of 2007, the ensuing Great Recession, and why government policies in Europe and North America over the past six years have failed to improve matters for the majority of their citizens. The second edition also applies tools developed to explain what is causing climate change and what will be required if it is to be resolved effectively and fairly"--Publisher's description.;1. Economics and liberating theory -- People and society -- The human center -- Natural, species, and derived needs and potentials -- Human consciousness -- Human sociability -- Human character Structures -- The relation of consciousness to activity -- The possibility of detrimental character structures -- The institutional boundary -- Why must there be social institutions? -- Complementary holism -- Four spheres of social life -- Relations between center, boundary, and spheres -- Social stability and social change -- Agents of history -- Applications -- 2. What should we demand from our economy? -- Economic justice -- Increasing inequality of wealth and income -- Different conceptions of economic justice -- Efficiency -- The Pareto principle -- The efficiency criterion -- Seven deadly sins of inefficiency -- Endogenous preferences -- Self-management -- Solidarity -- Variety -- Sustainability -- Weak versus strong versus environmental sustainability -- A workable definition of sustainable development -- Growth -- Conclusion -- 3. Efficiency and economic justice: a simple corn model -- Model 3.1: a domestic corn economy -- Situation 1: inegalitarian distribution of scarce seed corn -- Autarky -- Labor market -- Credit market -- Situation 2: egalitarian distribution of scarce seed corn -- Autarky -- Labor market -- Credit market -- Conclusions from the domestic corn model -- Generalizing conclusions -- Economic justice in the corn model -- Economic justice, exploitation, and alienation -- Occupy Wall Street -- Model 3.2: a global corn economy -- 4. Markets: guided by an invisible hand or foot? -- How do markets work? -- What is a market? -- The "law" of supply -- The "law" of demand -- The "law" of uniform price -- The micro "law" of supply and demand -- Elasticity of supply and demand -- The dream of a beneficent invisible hand -- The nightmare of a malevolent invisible foot -- Externalities: the auto industry -- Public goods: pollution reduction -- Green consumerism -- The prevalence of external effects -- Snowballing inefficiency -- Market disequilibria -- Conclusion: market failure is significant -- Markets undermine the ties that bind us -- 5. Microeconomic models -- Model 5.1: the public good game -- Model 5.2: the price of power game -- The price of patriarchy -- Conflict theory of the firm -- Model 5.3: climate control treaties -- Model 5.4: the Sraffa model of income distribution and prices -- The Sraffa model -- Technical change in the Sraffa model -- Technical change and the rate of profit -- A note of caution -- Producers and parasites -- 6. Macroeconomics: aggregate demand as leading lady -- The macro "law" of supply and demand -- Aggregate demand -- Consumption demand -- Investment demand -- Government spending -- The pie principle -- The simple Keynesian closed economy macro model -- Fiscal policy -- The fallacy of Say's Law -- Income expenditure multipliers -- Other causes of unemployment and inflation -- Myths about inflation -- Myths about deficits and the National Debt -- The balanced budget ploy -- Wage-led growth -- 7. Money, banks, and finance -- Money: a problematic convenience -- Banks: bigamy not a proper marriage -- Monetary policy: another way to skin the cat -- The relationship between the financial and "real" economies -- The financial crisis of 2008: a perfect storm -- 8. International economics: mutual benefit or imperialism? -- Why trade can increase global efficiency -- Comparative, not absolute, advantage drives trade -- Why trade can decrease global efficiency -- Inaccurate prices can misidentify comparative advantage -- Unstable international markets can cause macro inefficiencies -- Adjustment costs are not always insignificant -- Dynamic inefficiency -- Why trade usually aggravates global inequality -- Unfair distribution of the benefits of trade between countries -- Unfair distribution of the costs and benefits of trade within countries -- Why international investment could increase global efficiency -- Why international investment often decreases global efficiency -- Why international investment usually aggravates global inequality -- Open economy macroeconomics -- International currency markets -- Aggregate supply and demand in the open economy model -- Income expenditure multipliers in the open economy model -- Capital flows in the open economy model -- Monetary unions and the Eurozone -- 9. Macroeconomic models -- Model 9.1: Finance -- Bank runs -- International financial crises -- Conclusion -- Model 9.2: finance in real corn economies -- Banks in a domestic corn model -- Autarky -- Imperfect lending without banks -- Lending with banks when all goes well -- Lending with banks when all does not go well -- International finance in a global corn economy revisited -- Model 9.3: macroeconomic policy in a closed economy -- Model 9.4: macroeconomic policy in an open economy -- An IMF conditionality agreement with Brazil -- EC austerity policy and Greece -- Model 9.5: a political economy growth model -- The general framework -- A Keynesian theory of investment -- A Marxian theory of wage determination -- Solving the model -- An increase in capitalists' propensity to save -- An increase in capitalists' propensity to invest -- An increase in workers' bargaining power -- Wage-led growth -- 10. What is to be undone? The economics of competition and greed -- Myth 1: free enterprise equals economic freedom -- Myth 2: free enterprise promotes political freedom -- Myth 3: free enterprise is efficient -- Biased price signals -- Conflict theory of the firm -- Myth 4: free enterprise reduces discrimination -- Myth 5: free enterprise is fair -- Myth 6: markets equal economic freedom -- Myth 7: markets are fair -- Myth 8: markets are efficient -- What went wrong? -- Neoliberal capitalism in crisis -- 11. What is to be done? The economics of equitable cooperation -- Not all capitalisms are created equal -- Keynesian reforms -- Taming finance -- Reducing economic injustice -- Beyond capitalism -- Worker and consumer empowerment -- Worker-owned cooperatives -- Market socialism -- Democratic planning -- Participatory economics -- From here to there -- The future economy -- Conclusion -- A green new deal.