Microeconomics/ (Record no. 176135)
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| 000 -LEADER | |
|---|---|
| fixed length control field | 27817nam a2200145Ia 4500 |
| 020 ## - INTERNATIONAL STANDARD BOOK NUMBER | |
| International Standard Book Number | 9788131759400 |
| 040 ## - CATALOGING SOURCE | |
| Transcribing agency | CUS |
| 082 ## - DEWEY DECIMAL CLASSIFICATION NUMBER | |
| Classification number | 338.5 |
| Item number | DWI/M |
| 245 #0 - TITLE STATEMENT | |
| Title | Microeconomics/ |
| Sub title | theory and applications |
| Statement of responsibility, etc. | Dwivedi, D.N. |
| 250 ## - EDITION STATEMENT | |
| Edition statement | 2nd ed. |
| 260 ## - PUBLICATION, DISTRIBUTION, ETC. (IMPRINT) | |
| Place of publication, distribution, etc. | Delhi: |
| Name of publisher, distributor, etc. | Pearson, |
| Date of publication, distribution, etc. | 2012. |
| 300 ## - PHYSICAL DESCRIPTION | |
| Extent | xxvii,649p. |
| 505 ## - FORMATTED CONTENTS NOTE | |
| Formatted contents note | Part I Introduction<br/>1. Introduction to Microeconomics /<br/>What Is Economics?—3<br/>Economics Is a Social Science 4<br/>Why Economizing Behaviour? 4<br/>Two Major Branches of Economics 5<br/>What Is Microeconomics?—6<br/>Is Microeconomics a Positive or a Normative Science?—7<br/>Microeconomics As a Positive Science 7<br/>Microeconomics As a Normative Science 8<br/>Methodology of Positive Economics: Model Building andTheorization—8<br/>The Uses and Limitations of Microeconomic Theories—10<br/>The Uses of Microeconomic Theories 10<br/>Limitations of Microeconomic Theories 11<br/>Limitations Do Not Matter Much 12<br/>Review Questions and Exercises 12<br/>Endnotes 13<br/>Further Readings 14<br/>2, The Economy: Its Basic Problems<br/>and Working System 15<br/>What Is an Economy?—16<br/>Economic Activities Are Interrelated and Interdependent 16<br/>The Economic System Works Automatically 16<br/>How an Economy Works?—17<br/>The Circular Flow Model of a Simple Economy 17<br/>The Basic Problems of an Economy—19<br/>Problems in Maximizing Production and Optimizing Distribution 19<br/>Problems in Achieving Gro)wth, Full Employment and Stability 20<br/>V ...<br/>How Market Mechanism Solves the Basic Economic Problems?—21<br/>Drawbacks of the Free Enterprise System—22<br/>The Government and the Economy—24<br/>The Mixed Economy System Is the Order of the Day 25<br/>The Production Possibility Frontier—26<br/>Some Implications of PPF 28<br/>Shift in PPF 29<br/>Review Questions and Exercises 31<br/>Endnotes 32<br/>Further Readings 32<br/>Part II Market Mechanism: How Markets Work<br/>N<br/>3. The Market Forces: Demand and Supply 35<br/>The Concept of Market—36<br/>The Demand Side of the Market—36 ./<br/>Meaning of Demand 36<br/>The Law of Demand 37<br/>The Demand Schedule 37<br/>The Demand Curve 38<br/>The Factors Behind the Law of Demand 38<br/>Exceptions to the Law of Demand 40<br/>The Market Demand 40<br/>Determinants of Market Demand 42<br/>Demand Function 47<br/>Shift in Demand Curve 50<br/>The Supply Side of the Market—52 ^<br/>Market Supply 52 ^<br/>The Law of Supply 52<br/>The Supply Schedule and Supply Curve -52<br/>Shift in the Supply Curve 53<br/>Supply Function 55<br/>The Market Equilibrium: The Equilibrium of Demand and Supply-55<br/>Determination of Price in a Free Market 55<br/>The Concept of Market Equilibrium 55<br/>Detprmination of Market Price 56<br/>Market Mechanism: How Market Brings About Balance 56<br/>Graphical Illustration of Price Determination 57<br/>Price Determination by Demand and Supply Functions 58<br/>Shift in Demand and Supply Curves and Market Equilibrium—59<br/>Shift in Demand Curve 59<br/>Shift in Supply Curve 60<br/>Parallel Shift in Demand and Supply Curves 60<br/>Stability of Market Equilibrium—62<br/>Market Equilibrium Under Dynamic Conditions 62<br/>Conclusion—66<br/>Review Questions and Exercises 66<br/>Endnotes 69<br/>Further Readings 69<br/>4. Elasticity of Demand and Supply 70<br/>The Elasticity of Demand—71<br/>Price Elasticity of Demand—71<br/>The Arc and Point Elasticity 73<br/>Measuring Arc Elasticity 73<br/>Measuring Point Elasticity 75<br/>Price Elasticity Varies Along the Demand Curve 78<br/>The Slope of Demand Curve and Price Elasticity 80<br/>Determinants of Price Elasticity of Demand—84<br/>Measuring Price Elasticity from a Demand Function—85<br/>Measuring Price Elasticity from a Linear Demand Function 86 ^<br/>Price Elasticity from a Non-linear Demand Function 87<br/>Price Elasticity and Sales Revenue—88<br/>Price Elasticity and Marginal Revenue 89<br/>Relation Between MR and AR 90<br/>Price Elasticity and Total Revenue 92<br/>Price Elasticity and Consumption Expenditure—94<br/>Other Elasticities of Demand—95<br/>Cross-Elasticity of Demand 95<br/>Income Elasticity of Demand 96<br/>Application of Demand Elasticity—98<br/>Price Elasticity of Supply—98<br/>Definition and Measurement 98<br/>Determinants of the Price Elasticity of Supply 100 ^<br/>Review Questions and Exercises 100<br/>Endnotes 104<br/>Further Readings 104<br/>5. Application of Market Laws and Elasticities 105<br/>Excise Tax: Its Effects and Incidence—106<br/>Luifip-Sum and Ad Valorem Excise Tax 106<br/>The Effects of Excise Tax on Production and Price 107<br/>Who Bears the Tax Burden? 107<br/>Production Subsidy and Its Effects—109<br/>The Effect of Production Subsidy 110<br/>Who Benefits from Production Subsidy? 111<br/>Import Tariffs and Export Subsidies—111<br/>Import Tariffs 111<br/>Export Subsidy 112 ^<br/>Review Questions 113<br/>Endnotes 114<br/>Further Readings 114<br/>Part III Theory of Consumer Demand<br/>6, Theory of Consumer Demand: Cardinal<br/>Utility Approach 117<br/>Introduction—117<br/>Cardinal Utility Approach to Demand Analysis—118<br/>The Concept of Cardinal Utility and its Measurement 118<br/>The Total and Marginal Utility 119<br/>The Law of Diminishing Marginal Utility—119 • ^<br/>Numerical Example 120<br/>Graphical illustration 120<br/>Assumptions 120<br/>Consumers's Equilibrium; Cardinal Utility Approach—122 X<br/>Assumptions 122<br/>1 Consumer Equilibrium: A Single Commodity Case 122 ' - '<br/>Consumer Equilibrium: The Multiple Commodity 124<br/>Derivation of Demand Curve—125<br/>Drawbacks of Cardinal Utility Approach—127<br/>Review Questions and Exercises 127<br/>Endnotes 128<br/>Further Readings 129<br/>7. Theory of Consumer Demand: Ordinal %<br/>Utility Approach ^ 130<br/>Ordinal Utility Concept and Its Assumptions—131<br/>Assumptions of the Qrdinal Utility Theory 131<br/>Indifference Curve—132<br/>indifference Map 133<br/>The Concept of Marginal Rate of Substitution (MRS) 134<br/>Postulates of Diminishing MRS 135<br/>Why the MRS Declines 136<br/>Properties of Indifference Curves—137<br/>Indifference Curves Have a Negative Slope 138<br/>Indifference Curves Are Convex with Reference to the Origin 138<br/>indifference Curves Neither intersect Nor Are Tangential to<br/>One Another 138<br/>Higher indifference Curves Represent a Higher Level of Satisfaction<br/>Than the Lower Ones 139<br/>Other Types of Indifference Curves—140<br/>Perfect Substitutes 140<br/>Complementary goods 140<br/>Goods, Bads and Neuters—141<br/>What Are the Bads and the Neuters? 141<br/>Indifference Maps for Goods, Bads and Neuters 142<br/>Budgetary Constraint and the Budget Line—145<br/>What Causes Shifts in the Budget Line 146<br/>Slope of the Budget Line 146<br/>Consumer Equilibrium; The Ordinal Utility Approach—148<br/>Corner Solution: The Extreme Choice 150<br/>Composite Goods Case 151<br/>Changes in Income and Consumer Behaviour—152<br/>Income Effects on Consumer Behaviour Towards Normal Goods 152<br/>Inferior Goods 153<br/>Income and Consumption: The Engel Curve 154<br/>Engel and Demand Curves 155<br/>Engel Curve and Income Elasticity of Demand 156<br/>Changes in Prices and Consumer Behaviour—157<br/>Changes in Price and Consumer Behaviour: Case of Normal Goods 157<br/>Derivation of Consumer Demand Curve 158<br/>Graphical Derivation of Demand Curve 160 /<br/>Income and Substitution Effects of Price Change:<br/>Normal Goods Case—161<br/>Hicksian Approach 161<br/>Slutskian Approach 164<br/>Comparison of the Hicksian and Slutskian Methods 165<br/>Measurability of Income and Substitution Effects 166<br/>Income and Substitution Effects: Inferior Goods—167<br/>Effect of Rise in Money Income 167<br/>Income and Substitution Effects of Price Change:<br/>Case of Inferior Goods 167<br/>Giffen Paradox 169 ^<br/>Comparison of Cardinal and Ordinal Utility Approaches—171<br/>Similarity Between the Two Approaches 171<br/>Superiority of the Indifference Curve Approach 171<br/>Drawbacks of Indifference Curve Approach—172<br/>Appendix 173<br/>Review Questions and Exercises 174<br/>Endnotes 177<br/>Further Readings 179<br/>8. Application of Indifference Curve Analysis 180<br/>Introduction—180<br/>Measuring Welfare Effects of Income and<br/>Excise Taxes—181<br/>Choice Between Taxes 181<br/>Measuring Effects of Excise and Income Subsidies—182<br/>Measuring the Financial Cost of Excise Subsidy 182<br/>Measuring the Financial Cost of Lump-Sum Income Subsidy 183<br/>Making Choice of Policy 184<br/>Measuring Welfare Effect of Commodity Exchange<br/>Between Individuals—184<br/>Derivation of Labour Supply Curve—186<br/>Income-Leisure Choice 186<br/>Wage-Labour Offer Curve and Labour Supply Curve 188<br/>Evaluating Rationing of Consumer Good—190<br/>Rationing of One Commodity 190<br/>Rationing of More Commodities 191<br/>Review Questions and Exercises 193<br/>Endnotes 194<br/>Further Readings 194<br/>9. Revealed Preference Theory " ^ 195<br/>Introduction—195<br/>Revealed Preference: Assumptions and Axioms—196<br/>Assumptions 196 /<br/>Revealed Preference Axiom 196<br/>Decomposition of Substitution and Income Effects and<br/>Derivation of Demand Curve—198<br/>Derivation of Indifference Curve—199<br/>Appraisal of Revealed Preference Theory—201<br/>Review Questions and Exercises 202<br/>Endnotes 202<br/>Further Readings 202<br/>10. Consumer Surplus n 203<br/>Introduction—203 ><br/>Marshallian Concept of Consumer Surplus<br/>and Its Measurement—204<br/>Assumptions 205<br/>Critical Appraisal 205<br/>Hicksian Method of Measuring Consumer Surplus—206<br/>Measuring Consumer Surplus under Constant ML) of Money 206<br/>Measuring Consumer Surplus under Variable MU of Money 207<br/>Extentions of Hicksian Approach to Consumer Surplus—208<br/>Hicks'Four Concepts of Consumer Surplus 208<br/>Application of Consumer Surplus—211<br/>The Deadweight Loss of Commodity Taxation 212<br/>Deadweight Loss from Sales Tax: Tax on Consumers 212<br/>Measuring Gains of Subsidy 215<br/>Deadweight Loss of Price Control 216<br/>Deadweight Loss of Trade Barriers 217<br/>Review Questions 219<br/>Endnotes 219<br/>Further Readings 220<br/>Part IV Theory of Production and Analysis of Cost<br/>11. Theory of Production: Laws of<br/>Returns to a Variable Input 223<br/>Introduction—223<br/>Some Basic Concepts—224<br/>Meaning of Production 224<br/>Input and Output 224 f<br/>Short Run and Long Run 225<br/>Production Function—225<br/>Short-run and Long-run Production Function 227<br/>Assumptions 227<br/>Production with One Variable Input: The Short-run<br/>Laws of Production—228<br/>The Laws of Returns to Variable Input (Labour) 228<br/>' Assumptions 228<br/>Marginal Productivity of Labour 229<br/>Average Productivity of Labour 230<br/>The Three Stages in the Law of Diminishing Returns 230<br/>Factors Behind the Laws of Returns 231<br/>Applicability of the Law of Diminishing Returns 231<br/>Graphical Derivation of Marginal and Average Product Curves—231<br/>Derivation of Marginal Product Curve (MP^) 232<br/>Derivation of Average Product Curve (AP^^) 233<br/>The Three Stages of Production—233<br/>The Three Stages of Production and Production Decisions—235<br/>What About Stage II? 235<br/>Review Questions and Exercises 235<br/>Endnotes 237<br/>Further Readings 238<br/>12. Theory of Production: Laws of Returns to<br/>Two Variable Inputs 239<br/>Introduction—239<br/>The Isoquant Curve—240<br/>Derivation of Isoquant Curve—240<br/>Assumptions 240<br/>Properties of Isoquant Curves—241<br/>Isoquants Have a Negative Slope 242<br/>Isoquants Are Convex to the Origin 242<br/>Isoquants Do Not Intersect or Are Tangent to Each Other 242<br/>Upper Isoquants Represent a Higher Level of Output 243<br/>Marginal Rate of Technical Substitution (MRTS)—244<br/>Isoquant Map and Economic Region of Production—245<br/>IsoquantMap 245<br/>Economic Region of Production 246<br/>Other Forms of Isoquants—247<br/>Perfect Substitutes and Linear Isoquants 247<br/>The Fixed Factor Technology and L-shaped Isoquant 248<br/>The Kinked or Linear Programming Isoquants 249<br/>Elasticity of Technical Substitution—251<br/>The Laws of Returns to Scale—252<br/>Three Laws of Return to Scale 252<br/>The Law of Increasing Returns to Scale 253 ^ ^<br/>The Law of Constant Returns to Scale 254<br/>The Law of Decreasing Returns to Scale 255<br/>Production Function and Returns to Scale—256<br/>Cobb-Douglas Production Function and Returns to Scale 257 /<br/>Laws of Variable Proportions and Returns to Scale Compared—258<br/>Graphic Comparison 259<br/>Are the Laws of Returns Compatible? 260<br/>Can the Two Kinds of Laws Operate Simultaneously? 260<br/>Appendix 260<br/>Review Questions and Exercises 262<br/>Endnotes 264<br/>Further Readings 265<br/>13. Optimum Combination of Inputs ^ 266<br/>Introduction—266<br/>Derivation of Isocost—267<br/>The Least Cost Criteria of Optimum Input Combination—269<br/>Criterion in Value Terms 270<br/>Choice of Optimal Expansion path—271<br/>Effects of Change in Input Prices—272<br/>Change in Input Prices and Isocosts 272<br/>Change in Input Prices and Expansion Path 273<br/>Change in Relative Price of Inputs 273<br/>Substitution and Resource Effects of Change in Input Prices 274<br/>Review Questions and Exercises 276<br/>Further Readings 276<br/>14. Theory of Cost 278<br/>Introduction—278<br/>Cost Concepts—279 j<br/>Contents | xiii<br/>Accounting Cost Concepts 279<br/>Analytical Cost Concepts 280<br/>Policy Related Cost Concepts: Private and Social Costs 281<br/>Theory of Cost: An Overview—281<br/>Theory of Short-run Cost—282<br/>Short-run Cost Measures 282<br/>The Short-run Cost-Output Relationship 283<br/>Short-run Cost Function and Cost Curves—286<br/>Numerical Example 286<br/>Derivation of Behavioural Cost Equations 287<br/>Long-run Cost-Output Relationship—290<br/>Derivation of Total Long-run Cost (LTC) Curve 290<br/>Derivation of Long-run Average Cost (LAC) curve 292<br/>Derivation of Long-run Marginal Cost (LMC) Curve 293<br/>Optimum Size of the Firm in the Long Run 293<br/>Economies and Diseconomies of Scale: Factors<br/>Behind Cost Behaviour—294<br/>The Economies of Scale: Factors Causing Decrease in LAC 294<br/>Diseconomies of Scale: Why LAC Increases 296 /<br/>Modern Approach to the Theory of Cost—297<br/>Modern Approach to Short-run Cost Behaviour 298<br/>What Happens to the Average Variable Cost (AVC) ? 299<br/>The SAVC and SMC Curves 299<br/>The Short-run Average Cost (SAC) Curves 300<br/>Modern Approach to Long-run Cost Behaviour:<br/>The L-shaped Scale Curve 301<br/>Derivation of the LAC Curve 302<br/>Review Questions and Exercises 304<br/>Endnotes 305<br/>Further Readings 306<br/>Part V Theory of Firm: Determination of Price and<br/>Output<br/>15. The Objectives of Business Firms and<br/>Their Market Powers 311<br/>The Objectives of Business Firms—311<br/>Profit Maximization as Business Objective 312<br/>Profit-Maximization Conditions 312<br/>Numerical Illustration 314<br/>Graphical Instruction 315<br/>Controversy on Profit-Maximization Objective 317<br/>Alternative Objectives of Business Firms 318<br/>Conclusion 321<br/>The Market Structure and Power of Firms—321<br/>Perfect Competition 322<br/>Imperfect Competition 323<br/>f/lonopoly 323<br/>A Prelude to the Theory of Firm—324<br/>Review Questions and Exercises 324<br/>Endnotes 325<br/>Further Readings 325<br/>16. Price and Output Determination under<br/>Perfect Competition 327<br/>Characteristics of Perfect Competition—328<br/>Perfect versus Pure Competition 329<br/>Role of a Firm in a Perfectly Competitive Market—329<br/>What Are the Firm's Options 330 \<br/>Short-run Equilibrium of the Firm—330<br/>Assumptions 330<br/>Does a Firm Always Make Profit in the Short-run? 331<br/>Shut-down or Close-down Point 332 /<br/>Derivation of Supply Curve: A Digression—333<br/>Derivation of Firm's Supply Curve 333<br/>Derivation of Industry Supply Curve 334<br/>Short-run Equilibrium of Industry and Firm—334<br/>Link Between Short-run Equilibrium of the Industry<br/>and the Firm 335<br/>Long-run Equilibrium of the Firm and Industry—336<br/>Equilibrium of the Firm in the Long-run 336<br/>Equilibrium of Industry 337<br/>Long-run Supply Curve of a Competitive Industry—338 ^<br/>Constant Cost Industry 338<br/>Increasing Cost Industry 339 ><br/>Decreasing Cost Industry 340 ^ .<br/>Whether Decreasing Cost 341 '<br/>Conclusion—341<br/>Review Questions and Exercises 341<br/>Endnotes 343<br/>Further Readings 343<br/>17. Price iand Output Determination Under Monopoly 344<br/>Introduction—344<br/>Monopoly and Sources of Monopoly Power—345<br/>Definition and Features 345<br/>Sources and Kinds of Monopolies 346<br/>Cost and Revenue Curves Under Monopoly—346<br/>AR and MR Curves under Monopoly 347<br/>Short-run Equilibrium of the Monopoly: Price and Output<br/>Determination—348<br/>Monopoly Equilibrium by Total Revenue-Total Cost<br/>Approach 349<br/>Monopoly Equilibrium by MR-MC Approach 350<br/>Algebra of Profit Maximization: A Numerical Illustration 351<br/>Does a Monopoly Firm always Make Pure Profit? 352<br/>Profit Maximization by Using MC and Price Elasticity 354<br/>No Supply Curve Under Monopoly: A Digression—354<br/>Monopoly Equilibrium in the Long Run—355<br/>Capacity Utilization Under Monopoly—357<br/>Equilibrium of a Multi-plant Monopoly—358<br/>The Long-run Adjustments 359<br/>Price Discrimination Under Monopoly—361<br/>Price Discrimination 361<br/>Necessary Conditions for Price Discrimination 361<br/>Degrees of Price Discrimination 362<br/>Is Price Discrimination Desirable? 365 /<br/>The Gain to Monopolist from Price Discrimination 367<br/>Monopoly Vs. Perfect Competition—369<br/>Comparison of Long-run Price and Output 369<br/>The Deadweight Loss under Monopoly 370<br/>Some Other Monopoly-related Issues—373<br/>Incidence of Taxes and Effect of Subsidy Under Monopoly 373<br/>Peak-Load Pricing by a Monopoly 376<br/>Government Regulation of Monopoly Prices—378<br/>Measures of Monopoly Power—379<br/>Measures of Monopoly Power 379<br/>Appendix 381 ^ n<br/>Review Questions and Exercises 384 ^<br/>Endnotes 387<br/>Further Readings 388<br/>18. Price and Output Determination Under Monopolistic<br/>Competition 389<br/>Introduction—389<br/>Monopojistic Competition: Definition and<br/>Characteristics—390<br/>Definition of Monopolistic Competition 390<br/>Characteristics of Monopolistic Competition 391<br/>Chamberlin's Theory of Monopolistic Competition—392<br/>Basic Elements of Chamberlin's Theory 392<br/>Product Differentiation and Firm's Perceived Demand Curve 392<br/>Selling Costs and Firm's Cost Structure 394<br/>Concept of Industry and Product Groups 397<br/>Firm's Equlilbrlum Under Monopolistic Competition—397<br/>Assumptions 398<br/>Short-run Equilibrium of the Firm 398<br/>Long-run Equilibrium of the Firm 400<br/>Excess Capacity Under Monopolistic Competition—401<br/>Ideal Output and Excess Capacity 401<br/>Non-price Competition and Excess Capacity 403<br/>Selling Cost and Firm's Equilibrium: Non-price<br/>Competition—404<br/>Individual Equilibrium with Selling Cost 404<br/>Group Equilibrium 405<br/>Monopolistic Competition Versus Perfect Competition:<br/>A Comparison—407<br/>Criticism of Chamberlin's Theory of Monopolistic<br/>Competition—408<br/>Appendix 410<br/>Review Questions and Exercises 414<br/>Endnotes 416 y<br/>Further Readings 417 /<br/>19. Price and Output Determine Oligopoly 418<br/>Introduction—418<br/>Oligopoly: A Market of Few Sellers—419<br/>Definition of Oligopoly 419<br/>Factors Causing Oligopoly 419<br/>Features of Oligopoly 420<br/>The Oligopoly Models: An Overview—421<br/>Duopoly Models of Oligopoly—422<br/>Cournot's Duopoly Model 422 ><br/>Bertrand's Duopoly Model 427<br/>Edgeworth's Duopoly Model 428<br/>Stackelberg's Leadership Model 429<br/>Oligopoly Models—430<br/>Non-Collusive Models of Oligopoly 430<br/>Sweezy's Model of Oligopoly: Kinked-Demand Curve Model 432<br/>Collusive Model of Oligopoly—436<br/>What is a Cartel Form of Collusion? 436<br/>Price Leadership Models 441<br/>Price Leadership by a Low-Cost Firm 442<br/>Price Leadership by the Dominant Firm 445<br/>Tire Barometric Price Leadership 449<br/>Baumou's Theory of Sales Maximization: An Alternative<br/>Theory—449<br/>Baumol's Model without Advertising 450<br/>Baumol's Model with Advertising 451<br/>The Game Theory—453<br/>The Nature of the Problem: Prisoners' Dilemma 453<br/>Application of Game Theory to Oligopolistic Strategy 454<br/>Concluding Remarks—456<br/>Review Questions and Exercises 457<br/>Endnotes 459<br/>Further Readings 461<br/>Part VI Factor Market and Factor Pricing<br/>20. The Factor Market: Factor Demand and Supply 465<br/>Introduction—465<br/>The Theory of Distribution and Factor Pricing: An Overview—466<br/>Peculiarities of Factor Demand and Supply 467<br/>Development of Theories of Factor Pricing 467<br/>Factor Demand: Why a Factor is Demanded—467<br/>Factor Demand is a Derived Demand 468<br/>tvlarginal Revenue Productivity: The Basic Determinant of Facto/Demand 468<br/>Marginal Productivity and Factor Demand—469<br/>Factor Supply: Supply of Labour—470<br/>Derivation of Individual Labour Supply Curve 471<br/>fiAarket Labour Supply Curve 472<br/>Determination of Market Wage Rate: A Simple Theory—473<br/>Shift in Factor Market Equilibrium and its Stability 474<br/>Review Questions and Exercises 474<br/>Endnotes 475<br/>Further Readings 475<br/>21. Wage Determination under Perfect Competjtion 477<br/>Introduction—477<br/>Wage Determination in a Perfectly Competitive Market—478<br/>Derivation of Labour Demand Curve 478<br/>Derivation of Labour Demand Curve with Two Variable Inputs 483<br/>Industry Demand Curve for a Variable Factor: Labour 484<br/>Determination of Market Wage Rate 485<br/>Non-Homogeneous Labour and Wage Differentials—486<br/>Dynamic Wage Differentials 487<br/>Static Wage Differentials 487<br/>Wage Differentials due to Heterogeneity of Labour 487<br/>The Nature and Causes of Persisting Wage Differentials 489<br/>Summary—490<br/>Review Questions and Exercises 490<br/>Endnotes 491<br/>Further Readings 491<br/>22. Wage and Employment Determination under Imperfect<br/>Competition 493<br/>Introduction—493<br/>Wage Determination Under Product Monopoly and Perfect Competition in<br/>Labour Market—494<br/>Derivation of MRP^ Curve under Product Monopoly 495<br/>Expioitation of Labour by Monopoly 498<br/>Wage Determination Under Product Monopoly and Factor<br/>Monopsony—500<br/>Marginal Cost of a Variable Factor (Labour) 501<br/>Wages and Employment under Monopsony: Single Variable<br/>Factor (Labour) 502<br/>Factor Price and Employment under Monopsony: Two Variable Factors<br/>Case 502<br/>Perfect Competition In Commodity Market and Monopoly in Labour<br/>Market: The Case of Labour Union—505<br/>Wage Determination Under Bilateral Monopoly: The Case of Cpllective<br/>Bargaining—506<br/>Equilibrium under Bilateral Monopoly is Indeterminate 506<br/>Indeterminateness of Bilateral Monopoly 507<br/>Labour Union and Monopsonistic Exploitation 508<br/>Application of the Wage Determination Theory—509<br/>Effects of Minimum Wage Laws in Perfectly Competitive Markets 510<br/>Why is Minimum Wage Law Justified? 512<br/>Minimum Wage Laws, Monopsony and Trade Unions 512<br/>Review Questions and Problems 514<br/>Endnotes 514<br/>Further Readings 515 ><br/>23. Theory of Rent 516<br/>Introduction—516<br/>Land as a Factor of Production—516<br/>Historical Background of Rent Theory—517<br/>The Ricardian Theory of Rent—518<br/>Ricardian Definition of Rent 518<br/>Th§ Ricardian Theory of Rent 518<br/>Criticism 519<br/>Transfer Earning and Economic Rent: The Modern Approach—519<br/>Elasticity of Factor Supply and Economic Rent 520<br/>Quasi-rent: The Short-term Earning of Fixed Factors—522<br/>Graphical lliustration of Quasi-rent 522<br/>Is Rent Price Determined or Price is Rent Determined?—524<br/>— A Classical Controversy 524<br/>Modern View 524<br/>Rent Controls: An Application of Rent Theory—525<br/>Does This Happen in Reality? 526<br/>'Who Loses and Who Benefits?' 526<br/>Review Questions and Exercises 527<br/>Endnotes 527<br/>Further Readings 528<br/>24. Theories of Interest and Investment Decisions 529<br/>introduction—529<br/>Capital as a Factor of Production—530<br/>Some Early Thoughts on Interest Theory—530<br/>Theories of Interest—531<br/>Bohm-Bawerk's Theory of Interest 531<br/>Fisher's Theory of Interest: The Time Preference Theory 532<br/>Criticism 533<br/>The Classical Theory of Interest 534<br/>Keynes' Criticism of Classical Theory 535 /<br/>The Loanable Fund Theory of Interest 536<br/>Classical vs Neo-Classical Theory of Interest 536<br/>Criticism 537<br/>Interest and Investment Decisions—538<br/>The Time Value of Money 538<br/>Present Value and Investment Decisions 538<br/>NPV and Investment Decision 540<br/>\RR and Investment Decision 540<br/>IRRs vs Present Value 541<br/>Risk, Uncertainty and Investment Decisions—544<br/>Risk-Adjusted Discount Rate Approach 544<br/>Properties 545<br/>The Mean-Standard Deviation Method 545 .<br/>The Finite-Horizon Method 545 n n n<br/>Drawback 546<br/>The Probability Theory Approach 546<br/>Review Questions and Exercises 548<br/>Endnotes 549<br/>Further Readings 550<br/>25. Theories of Profit 551<br/>Introduction—551<br/>Meaning of Pure Profit—551<br/>Profit Theories: What Are the Sources of Profits?—552<br/>Walker's Theory of Profit: Profit Is Rent of Ability 552<br/>Clark's Theory of Profit: Profit Is Reward for Dynamic<br/>Entrepreneurship 553<br/>Hawley's Risk Theory of Profit: Profit Is Reward for Risk Bearing 555<br/>Knight's Theory of Profit: Profit Is a Return to Uncertainty Bearing 556<br/>Schumpeter's Innovation Theory of Profit: Profit Is Reward for<br/>Innovations 557<br/>Does Profit Enter the Cost of Production?—559<br/>Review Questions and Exercises 559<br/>Endnotes 560<br/>Further Readings 560<br/>26. Product Exhaustion Theorem 561<br/>Introduction—561<br/>The Adding-up Problem—562<br/>Euler's Theorem—562<br/>The Clark-Wicksteed-Walras Theorem—563 ^<br/>Change in Relative Factor Shares and Income Distribution—565<br/>The Elasticity of Factor Substitution and Relative Factor Shares 565<br/>Technological Progress and Income Distribution—567 ^<br/>Neutral Technological Progress 568<br/>Capital Deepening 568<br/>I Labour Deepening 568<br/>Review Questions and Exercises 569<br/>Endnotes 570<br/>Further Readings 570<br/>Part VII General Equilibrium and Welfare Economics<br/>27. General Equilibrium Analysis ^ 573<br/>introduction—573<br/>Interrelationship and Interdependence of Markets—574<br/>Interrelationship between the Markets 574<br/>Interdependence of Markets 575<br/>The Conditions of Static General Equilibrium—576<br/>The Condition for Consumers' General Equilibrium 576<br/>The Condition for Production General Equilibrium 577<br/>The Condition for Producers' General Equilibrium 577<br/>Thb Condition for Factor Qwners' General Equilibrium 577<br/>General Equilibrium in Exchange—577<br/>Edgeworth Box Diagram 578<br/>The Condition for General Equilibrium in Exchange 579<br/>Efficient Allocation of Goods 580<br/>General Equilibrium in Production—581<br/>The Condition for General Equilibrium in Production 582<br/>- Producer's Equilibrium in a Competitive Input Market 583<br/>The Production Possibility Frontier—584<br/>The Slope of PPF and Marginal Rate of Transformation (MRT) 585<br/>General Equilibrium in Competitive Product Market—586<br/>Review Questions and Exercises 587<br/>Endnote 588<br/>Further Readings 588<br/>28. Welfare Economics: Pareto Optimality 589<br/>introduction—589<br/>Definitions and Nature of Welfare Economics—590<br/>Definition of Welfare Economics 590<br/>is Welfare Economics a Positive or a Normative Science? 590<br/>The Concept and Measurement of Social Welfare—591<br/>Some Early Concepts of Welfare 591<br/>Pareto's Concept of Welfare 591<br/>Pareto's Welfare Economics—592<br/>Pareto Optimum: Definition 592 ^<br/>Pareto Optimality Conditions 593<br/>Assumptions 594<br/>Pareto Optimality in Exchange 594<br/>Pareto Optimality in Production: Optimum Aiiocation of Factor<br/>inputs 596<br/>Optimum Distribution of Goods Between Firms: Optimum Specialization of<br/>Firms 597<br/>Summary of Pareto Optimally Conditions 600<br/>Some Additional Conditions of Pareto Optimality 601<br/>Total Conditions of Pareto Optimality 601<br/>Perfect Competition and Pareto Optimality—601<br/>Efficiency in Exchange 602 ^<br/>Efficiency in Production 602 ^<br/>Efficiency in Production and Exchange 602<br/>Some Exceptions 603<br/>Externalities and Pareto Optimality—604<br/>Externalities in Production 604<br/>External Economies in Production 605<br/>External Diseconomies in Production 606<br/>Externalities in Consumption 607<br/>External Economies in Consumption 607<br/>Extdrnai Diseconomies in Consumption 608<br/>Externalities of Public Goods 609<br/>indivisibility and Pareto Optimality 610<br/>Conclusion—610<br/>Review Questions and Exercises 611<br/>Endnotes 613<br/>Further Readings 614<br/>29. New Welfare Economics 616<br/>Introduction—616 .<br/>The Kaidor-Hlcks Compensation Criterion—617 .<br/>Shortcomings of Kaldor-Hicks Criterion 618<br/>The Scitovsky Double Criteria—620<br/>The Bergson Criterion: The Social Weifare Function—620<br/>Weakness of Bergson Criterion 621<br/>Arrow's Theorem of Democratic Group Decision—622<br/>Problems in Arrow's Theorem 622<br/>Grand Utility Possibility Frontier and Welfare Maximization—623<br/>Derivation of Grand Utiiity Possibility Frontier 623<br/>Determination of the Point of Bliss: The Point of Maximum<br/>Social Welfare 624 \ //<br/>The Theory of Second Best—625<br/>Lipsey-Lancaster Refute the Second Best Theory 626<br/>Conclusion—626<br/>Review Questions and Problems 627 /<br/>Endnotes 627<br/>30. Market Failures and Public Goods 629<br/>Introduction—629<br/>Growth of Monopoly Power and Market Failure—630<br/>Imperfect Market Information—631<br/>. Existence of Public Goods—632<br/>What Are Public Goods? 632<br/>Characteristics of Pure Public Goods 633 ^ 'j<br/>Public Goods and Market Failures 634<br/>Externalities and Market Failure—635 ><br/>Public Provision of Public Goods—635 ,, •<br/>Externalities and Their Correction—636<br/>Treatment of External Costs 637 ''<br/>Treatment of External Benefits 638<br/>Review Questions and Exercises 639<br/>Endnotes 639<br/>^ Further Readings 640<br/>y<br/>Index Q41<br/>/ |
| 942 ## - ADDED ENTRY ELEMENTS (KOHA) | |
| Koha item type | AC Sinha Collection |
| Withdrawn status | Lost status | Damaged status | Not for loan | Home library | Current library | Shelving location | Date acquired | Full call number | Accession number | Date last seen | Date last checked out | Koha item type |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Central Library, Sikkim University | Central Library, Sikkim University | General Book Section | 29/08/2016 | 338.5 DWI/M | P31134 | 18/07/2023 | 05/07/2023 | General Books |