Part One Managing the Economy 1
Chapter 1 Measuring Economic Success 2
Economic Growth and Its Measurement 3
High Employment,Low Unemployment 7
Stable Prices 10
Satisfactory Balance of Payments 13
Potential Conflicts between Goals 13
Case Study Japan's Economic Performance Between 1960-1996 19
Chapter 2 Aggregate Demand and Supply 22
Aggregate Demand(AD) 23
Aggregate Supply 27
Interaction of AS and AD 32
Case Study The Two Supply Shocks in the 1970s 40
Chapter 3 Demand Management:Fiscal Policy and Monetary Policy 42
Fiscal Policy 43
Monetary Policy 48
The Effects of Stabilization Policy 56
Case Study China's Macroeconomic Policy in Recent Years 61
Chapter 4 Supply Management and Income Policies 64
Supply-side Policies 66
Income Policies 72
Case Study The Laffer-Curve and the Supply-Side Policy 79
Part two The Framework of World Trade 81
Chapter 5 Basic Theories of International Trade 82
Classical Theories of Trade 83
The Factor-Proportions Theory-HO Theory 84
Demand-Side Theories of Trade and Country-Similarity Theory 86
Technology-Based Theory of Trade 88
The Product Life-Cycle Model of Trade 89
Case Study The Theory behind the Antidumping 96
Chapter 6 Free Trade Versus Protectionism 98
The Gainsfrom Free Trade 99
Different Means of Protection 102
The Arguments for Trade Protection 106
Case Study The Growing U.S.Trade Imbalance with China 113
Chapter 7 Multilateralism Versus Regionalism 115
Multilateral Trade Liberalization-from GATT to WTO 116
Regional Trade Liberalization 120
Case Study Towards a Tripartite World 129
Chapter 8 The Changing Structure of World Output and Trade 131
The Post-War Growth of World Output 133
The Growth of World Trade and Changes in Commodity Composition 134
The Growth of Service Trade 139
Case Study China's Bid to Join the World Trade Organization 150
Part Three International Monetary Relations 152
Chapter 9 Balance of Payments 153
Accounting Principles 155
Balance of Payments Structure 158
Practical Issues:Problems and Solutions 164
Case Study Mexico's 1994 Balance of Payments Crisis 172
Chapter 10 Exchange-Rate Systems 174
Fixed Exchange Rates 175
Flexible Exchange Rates 179
Hybrid Exchange-Rate Systems 184
Case Study The Shift from a Fixed Exchange-Rate Regime to a Flexible Exchange-Rate Regime 195
Chapter 11 Macroeconomic Policy in an Open Economy 198
Economic Objectives of Nations 199
Policy Instruments 200
Policy Effects 203
International Economic Policy Coordination 211
Case Study Plaza Agreement of 1985 and Louvre Accord of 1987 216
Chapter 12 International Monetary System 219
The Gold Standard Era,1870-1914 220
The Inter-War Period(Flexible Rates and Controls),1918-1939 223
The Bretton Woods System and the International Monetary Fund(IMF),1944-1973 225
Managed Floating Since 1973 and the European Monetary System 231
Case Study The Gold Standard and the Great Depression 239
Part Four Global Competitive Environ-ment 241
Chapter 13 Managing Business Enterprises 242
Globalization-A Reality or An Illusion? 243
Historical Review of Globalization 246
Indicators of Increasing Integration 249
Has Globalization Gone Too Far?-Debate Over It 253
Case Study Disintegration of Production 261
Chapter 14 Competition and Competitive Advantage 263
Introduction to the Theory of Competitive Advantage-Concepts and Parameters 264
Complete Formulation of Competitiveness 268
Growing Impact of International Competitiveness 269
Case Study Free Competition 277
Chapter 15 Technological Innovation and Competitiveness 279
The Meaning of Innovation and The Development of Technological Innovation 280
Skill-Based or Resource-Based Competitiveness 283
Impact of technological innovation 286
Case Study Innovation-Key for Success 295
Chapter 16 Corporate Strategies and National Policies 297
Definition of Corporate Strategy And Its Historical Develop-ment 298
The Formulation of Corporate Competitive Strategies 303
National policies to help build up competitive edge 308
Bridging Corporate Strategy With The Nation's Wealth-Building Strategy 310
Case Study Strategies for Growth 319
Part five Other Relevant Environ-ment 321
Chapter 17 Political-Legal Environment 322
Political Environment 323
Legal Environment 328
Case Study The Big Gun 348
Chapter 18 Social-Cultural Environment 351
What Is Culture 352
Social Structure 354
Social Stratification 358
Religion 361
Language 368
Education 369
Culture and the Workplace 370
Cultural Change 373
Case Study Cultural differences at ABB 384
Key to Exercises 387