Economics for Policy Makers
by Gustavo Rinaldi (Author)

About the Author
Gustavo Rinaldi, Ph.D., is a lecturer in macroeconomics at the University of Turin, Italy, and an ILO consultant.

About this book
Certain key economic decisions taken by organizations and indeed countries are often not made by econo-mists but by businessmen, trade unionists, politicians and policy-makers. Those who employ people, those who represent workers, those who make laws and those who elect them need economics but may have little time or desire to study it.
This book makes economics easily available to everyone. The author’s use of simple language and avoidance of technical jargon provides non-econo-mists with a better understanding of economic reasoning and the tools "to know and to decide". The author achieves this through introducing key concepts in short presentations and arming the reader with selected press articles and recent research using these concepts. An analysis of these demonstrates how a general concept can be derived from a specific context and highlighted questions provide the basis for further debate. The reader can then focus on the parts most relevant to their own needs.
This book will have great appeal to employers, trade unionists and public officials attending courses organized by international institutions, professional training providers, as well as graduate students of courses where economics is an important element, especially in relation to its policy implications. Finally, it is invaluable for anybody who has wanted to learn the basics of practical economics but has been deterred by its technicalities.

Brief contents
Microeconomics
PART I Introduction 3
1 Economic profit 5
    1.1 The value of the best foregone alternative: the opportunity cost 5
    1.2 Sunk costs vs recoverable costs 7
    1.3 Accounting profit 13
    1.4 The economic profit: comparing two scenarios 14
    1.5 Different objectives of the firms 16
2 Value added 21
    2.1 Intermediate consumption and value added 21
    2.2 Value added and vertical integration 25
PART II Production and costs 29
3 Production and productivity 31
    3.1 Rigid and flexible production techniques 31
    3.2 The measurement of efficiency 35
    3.3 Marginal productivity 38
    3.4 The cornerstone of industrial negotiations: unit labour cost 41
4 Costs 48
    4.1 Fixed costs and variable costs 48
    4.2 Marginal and average costs 49
    4.3 Types of costs 52
    4.4 The Supply: is the firm ready to sell a certain quantity? At what price? 54
    4.5 A special cost: the cost of using the market or transaction cost 57
5 Economies of scale 63
    5.1 Reducing the average cost of a firm 63
    5.2 The causes of economies of scale 65
    5.3 The limits to economies of scale 67
    5.4 The minimum efficient size and concentration 68
PART III Customers and competitors 73
6 Demand for the products of an industry and of a monopolist 75
    6.1 An industry and the demand for its product 75
    6.2 Demand and supply 76
    6.3 Total revenue and marginal revenue 78
    6.4 Price-elasticity 82
    6.5 The effects of income on demand: income-elasticity 88
    6.6 Price cross-elasticity: complements and substitutes 89
7 Market environments 94
    7.1 Monopoly 94
    7.2 Perfect competition 97
    7.3 Oligopoly 99
    7.4 Monopolistic competition 103
Macroeconomics
PART IV Introduction to macroeconomics 109
8 Key words of national accounts 111
    8.1 Supply (sources) of goods: production (GDP) and imports 112
    8.2 Uses of goods: household consumption, private investment, government spending and export 113
9 Money and prices 120
    9.1 Money and other financial assets 120
    9.2 The demand for and supply of money and the interest rate 125
    9.3 Money supply and prices 128
    9.4 Banks are special 129
    9.5 How much inflation is “too much”? 135
PART V Foreign economic relations 141
10 The foreign trade of goods: exports and imports 143
    10.1 The quality of goods 143
    10.2 The (nominal) exchange rate and the exchange rate regimes 147
    10.3 The real exchange rate 152
    10.4 The determinants of imports 152
    10.5 The determinants of exports 154
11 Financial movements 159
    11.1 Main types of financial movements 159
    11.2 Advantages and disadvantages of foreign portfolio investments 161
    11.3 Advantages and disadvantages of foreign direct investment (FDI) 166
    11.4 The freedom of movement of capital 169
12 International accounts 174
    12.1 The current account of the balance of payments 174
    12.2 The capital account of the balance of payments 180
    12.3 The financial account of the balance of payments 181
    12.4 The international investment position (IIP) 183
PART VI Fiscal policy 191
13 Monetary transfers: taxes, benefits, subsidies and social contributions 193
    13.1 General taxation: taxes not earmarked to fund specific expenses 194
    13.2 Earmarked monetary transfers between private subjects and government: social contributions, pensions and benefits 197
    13.3 The macroeconomic effects of taxes (and social contributions) 201
14 Government spending on goods and services 211
    14.1 Public employment 211
    14.2 Public procurement 213
15 Public spending on education, training, research and development (R&D) 222
    15.1 Education and training 222
    15.2 Public expenditure in R&D 224
    15.3 Government expenditure in education and R&D and its macroeconomic effects 226
16 Public deficit and public debt 231
    16.1 The public budget and the public deficit 231
    16.2 The public debt and the market for sovereign bonds 238
    16.3 The sustainability of a public debt 240
PART VII Private demand 255
17 Household consumption: the main destination of goods and services 257
    17.1 The main features of household consumption 257
    17.2 The determinants of consumption 259
    17.3 Disposable income which is not consumed: savings 261
18 Private investment: supplying the private sector with new capital 265
    18.1 The net present value (NPV) method for firms’ investment decision 265
    18.2 The main features of investment 267
PART VIII The labour market and inequality 271
19 The labour market 273
    19.1 A basic description of labour market stocks and flows 273
    19.2 Key indicators of the labour market (KILM) 277
    19.3 The determinants of salaries 279
    19.4 Economic growth and unemployment 281
    19.5 Unemployment and prices 283
20 Income distribution and its effects 288
    20.1 The nature of inequality 288
    20.2 The change of inequality and its effects 293
    20.3 Causes of and remedies for inequality 300
Appendix – indexes of competitiveness 306
    A) Global Competitiveness Index (GCI) 306
    B) World Competitiveness Ranking (WCR) 310
    C) Doing Business Indicators (DBIs) 316
    D) Discussion 318
Index 326

Pages: 348 pages
Publisher: Routledge; 1 edition (May 3, 2019)
Language: English
ISBN-10: 1138388815
ISBN-13: 978-1138388819