Foundations of Economics: A Beginner's Companion

Yanis Varoufakis

Psychology Press, 1998 - Business & Economics - 396 pages

Foundations of Economics breathes life into the discipline by linking key economic concepts with wider debates and issues. By bringing to light delightful mind-teasers, philosophical questions and intriguing politics in mainstream economics, it promises to enliven an otherwise dry course whilst inspiring students to do well.
The book covers all the main economic concepts and addresses in detail three main areas:
* consumption and choice
* production and markets
* government and the State.
Each is discussed in terms of what the conventional textbook says, how these ideas developed in historical and philosophical terms and whether or not they make sense. Assumptions about economics as a discipline are challenged, and several pertinent students' anxieties ('Should I be studying economics?') are discussed.

Contents

• Introduction: 3
• 12 The birth of economics: 10
• Adam Smith: 16
• David Ricardo: 21
• Karl Marx: 25
• history and ideology: 28
• 13 Modern textbook economics or neoclassical economics: 30
• utility and the Equmargna Principle: 34
• 133 The imperialism of neoclassical or marginalist economics: 36
• 134 Economics and textbooks: 38
• Review textbooks on consumer and choice theory: 43
• 212 Utility and the Equimarginal Principle: 46
• 213 Consistent preferences as rationality: 53
• 214 Extending the Equimarginal Principle: 57
• 215 From the Equimarginal Principle to the theory of consumer demand: 62
• the Equimarginal Principle becomes ambitious: 66
• time and the supply of savings: 68
• the decision to sell ones labour: 71
• 224 The valuation of life: 73
• History of textbook models: 76
• 312 The birth of utilitarianism: 80
• 313 From Benthams utility to neoclassical economics: 82
• 32 Ordinal cardinal and expected utilities: 84
• 322 The limits of ordinal utility and the partial return of cardinal utility: 85
• the politics beneath the surface: 90
• 34 Summary: 93
• Critique do we maximise utility even subconsciously? Should we?: 94
• 422 Suspect desires and the threat of rational idiocy: 97
• 423 The utility machine: 102
• the fluidity of desires: 105
• looking for happiness is not like looking for gold: 107
• 43 Happiness freedom and creativity: 108
• 432 Creative selfmanipulation and identity: 110
• 433 Utility maximisation and freedom: 112
• 44 Conclusion: 113
• Review textbooks on firms production and markets: 121
• 512 The firms choice of input combinations: 124
• 513 The firms cost of production: 130
• 514 Profit maximisation: 131
• 52 Firms and markets: 133
• a duopoly: 134
• 523 Collusion cartels and monopoly: 137
• 524 Expanding competition: 138
• 525 Parted competition: 141
• 526 The significance of perfect competition: 144
• 53 Summary: 148
• History off textbook models The intellectual road to perfect competition: 149
• firms as blocks of capital: 150
• production as exchange: 155
• 62 Markets and competition: 158
• rivalry and profit equalisation: 160
• perfect competition as the ideal market: 162
• 63 Summary: 165
• Critique is the textbooks theory of production good economics good politics both or neither?: 166
• 712 Difficulties in distinguishing between work and leisure: 167
• 72 Production as exchange: 170
• the covert role of isoquants: 175
• 723 The covert politics of isoquants: 177
• 724 Consenting to exploitation: 178
• 73 The source of profit in competitive markets: 180
• 732 Profit as a just payment: 181
• 733 Capital as a social relation: 184
• 734 Saving capitalism from its neoclassical defence: 187
• 74 An alternative approach to production: 191
• 742 Wages prices and profit: 195
• 743 The strengths weaknesses and politics of the pure production model: 196
• 75 Conclusion: 200
• Review textbooks on markets and social wellbeing: 205
• the Equimarginal Principle and economic efficiency: 206
• the Production Possibility Frontier PPF: 213
• the Equimarginal Principle and redistribution: 215
• 815 The first two theorems and the distribution of utility amongst societys members: 218
• the impossibility of aggregate preferences: 222
• 817 A brief summary: 225
• 82 Market failures: 226
• 822 Exploitation of public and natural resources: 228
• 823 Nonprovision of public goods: 229
• externalities market failure and the freerider problem: 230
• 825 Market failures due to ignorance and uncertainty: 233
• 826 Monopoly as social failure: 237
• the compensation principle: 240
• neoclassical economics on rational societies: 244
• History off textbook models: 247
• efficiency versus equity: 250
• 922 Liberal thinkers and the efficiencyversusequity debate: 251
• 923 The efficiencyversusequity debate and the deadend of welfare economics: 253
• John Rawls theory of distributive justice: 254
• Rawls veil of ignorance: 256
• redistributing according to the Maximin Principle: 259
• 934 Rawls on the efficiencyversusequity dilemma: 261
• Rawls and the Good Society: 262
• Robert Nozicks entitlement theory of justice: 265
• 942 The three rights that individuals are entitled to in the Good Society: 266
• 943 Summary: 267
• an assessment: 268
• 952 Internal contradictions of Rawls and Nozicks theories: 270
• economists and their textbooks at the deep end: 275
• Critique can a capitalist society be good?: 279
• 1012 Economics as history: 281
• 1013 Economics and change: 288
• 102 Social justice and freedom FROM the market: 290
• 1022 Commodified information and the gift of knowledge: 295
• blood education and human remains: 299
• 103 Market failure or market nature?: 302
• 1032 Can the habitually failing labour market be corrected? Keynes answer: 304
• Marxs view: 308
• challenging the great liberal debate: 314
• 1042 A public interest has no meaning in an exploitative racist sexist society: 317
• 1043 Brief glimpses of the Good Society: 319
• Foundations and beyond: 322
• Money and the State: 323
• Wages and money illusion: 326
• International trade and the Third World: 328
• Does economic theory matter?: 335
• 112 The impossible task of separating the facts from the theory: 339
• 113 Why economic theories cannot be judged by the facts: 343
• 114 Three examples of untestable economic theories: 344
• the Equimorgna Principle in production: 345
• 115 How do we find out the truth when the facts are too compromised?: 346
• 116 So do economic theories matter?: 351
• The curse of economics: 354
• 122 Economics courses as indoctrination: 357
• teaching that value exists only if it can be quantified: 359
• the economists apology for inexcusable social failures: 360
• 123 The economics profession as a priesthood: 361
• economics departments in crisis: 370
• 125 In defence of economics: 371
• Further reading: 378
• References: 382
• Name Index: 386
• Subject Index: 388

About the author

Yanis Varoufakis is a Senior Lecturer in Economics at Sydney University. He is the co-author with Shaun Hargreaves-Heap, of Game Theory: A Critical Introduction, also published by Routledge.

Bibliographic information

• Title: Foundations of Economics: A Beginner's Companion; Beginner's Companion
• Author: Yanis Varoufakis
• Edition: illustrated, reprint
• Publisher: Psychology Press, 1998
• ISBN: 0415178916, 9780415178914
• Length: 396 pages
• Subjects: Business & Economics / Economics / General; Business & Economics / General; Business & Economics / Reference