Moore McDowell Rodney Thom Robert Frank Ben Bernanke
ISBN: 0077108310 Copyright year: 2006
Preface
When we agreed with McGraw-Hill to prepare a European Edition of Frank and Bernanke, it
was with the experience of having used the original, U.S. text for two years in University
College Dublin. Both of us had found that the text was clear, easy to use, and, more important
in some ways, a source of constant challenge to our students. This challenge reflected
the emphasis on continually asking the reader to think about real-world phenomena and to
analyse them using the relevant concepts drawn from economics. The point was to make
clear to students that economics offers a powerful intellectual tool set that helps us understand
a much wider set of behaviours and institutions than would initially be thought of as
being matter for economic analysis. The end result being sought was an ability to look at the
world in a new way, and to understand its workings by applying an analytical approach that is
coherent and highly predictive.
We are, however, aware that there are significant risks in adding to, subtracting from and
modifying a book that has been very well received on the basis of its innovative approach to
introductory economics. Hence in preparing a European Edition we have attempted to maintain
the text’s analytical approach to economic principles but to place them in a context
which is relevant to the European reader. Apart from changes in language and spelling from
'American' to 'English English', there are several major content changes from the original
text. The most obvious revision was the need to recast the chapters dealing with central
banking, macroeconomic policy and exchange rates to reflect the European experience.
While the basic theory of macroeconomics remains the same, the practical aspects of fiscal
and monetary policy inside and outside the Euro zone required a re-write of key chapters in
the macroeconomic sections. We have also included two new chapters. Chapter 16 builds on
the existing trade chapter and contains both relevant theory and a historical account of the
process of economic integration in Europe while Chapter 30 discusses the economic rationale
for monetary integration and asks if the introduction of the euro can be justified on
purely economic grounds.
A second change is a slightly more rigorous treatment of theory in both the microeconomic
and macroeconomic sections. This reflects our view that if a text is to prepare
European students to continue with economics it should introduce some additional analytical
tools that are required for this purpose and should seek to familiarise students with the use of
simple algebraic approaches to theory. In the macroeconomics sections greater use is made of
algebra to develop the basic model of income determination as a complement to graphical
analysis. In the microeconomics sections the indifference curve approach to demand theory is
embodied in the main text, although it can be skipped. Calculus is used (sparingly) to derive
the familiar conditions for consumer and producer equilibrium and the treatment of competition
among the few has been extended to cover reaction functions at an elementary level.
2006 McGraw-Hill Education Europe