This fully updated fourth edition explores microeconomic concepts, with a distinctive emphasis on 'the economic way of thinking' and its applicability to sharp managerial thinking, productivity, and good decision-making. It stands apart due to its strong focus on practical and applied knowledge from the business context and its unique structure (Part I of each chapter develops key economic principles; Part II draws on those principles to discuss organizational and incentive issues in management, focusing on solving the 'principal-agent' problem to maximize the profitability of the firm). There are plentiful real-life scenarios and provocative examples in each chapter. Accessible to MBA students, other graduate students and undergraduates, it is ideal as a core text for courses in Managerial Economics. Requiring an understanding of only basic algebra, this new edition is more concise with a wealth of online resources, including additional online chapters and an online appendix with more advanced mathematical applications.

Joseph Schumpeter, like Ludwig von Mises, thought of capitalism as a process that often, over time, turned luxuries into necessities. Schumpeter warned that assessments that ignored this process, which he termed creative destruction, would misconstrue the social results that arise from capitalism in practice. This article exposes the applicability of this warning to the analyses of positional-good consumption presented by Robert Frank which led him to conclude that a steeply progressive tax on consumption would constitute a free-lunch, bringing in “trillions of dollars” without the loss of “anything of enduring value.”

Ultraviolet (UV) irradiation to the skin downregulates lipid synthesis and adipokine production in subcutaneous fat. Recent evidence also suggests that UV exposure limits body weight gain in obesity models. However, it is still unclear how chronic UV irradiation modulates the energy metabolism of the whole body. High fat- or normal diet-fed female C57BL/6 mice were treated with UV or sham irradiation for 12 weeks. UV exposure stimulated food intake but prevented body weight gain. Leptin, an appetite-suppressing hormone, was significantly reduced in serum, skin, and inguinal subcutaneous fat of high fat diet-fed UV-irradiated mice. Besides, UV irradiation significantly promoted the orexigenic pathway involving neuropeptide Y and agouti-related peptide in hypothalamus. Mice with UV irradiation showed browning of subcutaneous white adipose tissues and increased thermogenesis without increased physical activity. Notably, liquid chromatography/mass spectrometer analyses in the skin revealed that norepinephrine was among the most significantly increased neurotransmitters in UV-irradiated mice, and downregulation of norepinephrine production by dopamine β-hydroxylase inhibitor nepicastat reversed the effects of UV on food intake and body weight. In conclusion, chronic UV irradiation induces NE release resulting in stimulating food intake due to the downregulation of the anorexigenic hormone leptin, but preventing weight gain through the elevation of energy expenditure.

When considering the probability of voters being decisive in presidential elections, public choice economists typically proceed as if the probability can reasonably be approximated by assuming that the winner is determined by simple majority vote. It is well known the Electoral College can cause presidential candidates to lose elections despite winning the popular vote (an election inversion). But the Electoral College’s ability to increase the probability of some voters being decisive effectively has been ignored, despite such increases having occurred in 10 of the last 49 presidential elections. By examining the influence of the Electoral College in most of the presidential elections from 1824 to 2016, I explain and give examples of how the probabilities of some voters being decisive were elevated above what they would have been under majority rule, with the increase being truly astounding in several cases. The examples do not weaken the importance of expressive voting, but our understanding of such voting is improved by considering the probability effects of the Electoral College on voter decisiveness.

Subcutaneous fat is now regarded as the pivotal regulator of metabolic homeostasis. Previously we demonstrated that ultraviolet (UV) irradiation to the skin induces loss of underlying subcutaneous fat, and also reduces the expression of adiponectin and leptin, which mediate further deterioration of extracellular matrix impairment in human skin. Here we investigated whether chronic UV irradiation modulates energy metabolism in high fat diet-fed mice in vivo. High fat diet-fed mice irradiated with UV for 12 weeks showed a significantly less increase in their body weights despite higher intake of diet and calories. Consistently, the hypothalamus from UV-irradiated mice showed significantly increased expression of orexigenic (appetite-stimulating) factors, while the expression of anorexigenic (appetite-suppressing) factors was decreased upon UV irradiation. On the other hand, the circulating level of anorexigenic hormone leptin was significantly down-regulated in mice irradiated with UV. Moreover, the expression of leptin was also significantly decreased and suppressor of cytokine signaling-3, which is implicated in the regulation of leptin signaling and resistance, was significantly increased in skin from UV-irradiated mice. Interestingly, UV also induced the expression of thermogenesis-related genes such as uncoupling protein 1 (UCP-1), β3-adrenergic receptor as well as that of cyclic AMP in mice. Collectively, our findings indicate that chronic UV irradiation induced changes in thermogenesis, appetite-regulating pathways, and energy metabolism via neuroendocrine factors and hormones, suggesting that UV irradiation may modulate whole-body energy homeostasis as well as subcutaneous fat metabolism.

This book presents a provocative defense of market dominance. In Defense of Monopoly offers an unconventional but empirically-grounded argument in favor of market monopolies. Authors McKenzie and Lee claim that conventional, static models exaggerate the harm done by real-world monopolies, and show why some degree of monopoly presence is necessary to maximize the improvement of human welfare over time. Inspired by Joseph Schumpeter's suggestion that market imperfections can drive an economy's long-term progress, In Defense of Monopoly defies conventional assumptions to show readers why an economic system's failure to efficiently allocate its resources is actually a necessary precondition for maximizing the system's long-term performance: the perfectly fluid, competitive economy idealized by most economists is decidedly inferior to one characterized by market entry and exit restrictions or costs. An economy is not a board game in which players compete for a limited number of properties; nor is it much like the kind of blackboard games that economists use to develop their monopoly models. As McKenzie and Lee demonstrate, the creation of goods and services in the real world requires not only competition, but the prospect of gains beyond a normal competitive rate of return.

Background/AimsHelicobacter pylori (H. pylori) infections, which cause a variety of gastrointestinal symptoms, are common in South Korea. Recent reports have shown a decline in the H. pylori eradication rates. β-caryophyllene is a natural bicyclic sesquiterpene that occurs in a wide range of plant species, such as cloves, basil, and cinnamon. β-caryophyllene has been reported to have anti-inflammatory and anti-bacterial effects. This study investigated the inhibitory effects of β-caryophyllene on H. pylori and its potential role as an alternative gastrointestinal drug.MethodsThis 8-week, randomized double-blind, placebo-controlled trial categorized subjects into a β-caryophyllene group (33 patients who received 126 mg/day of β-caryophyllene) and a placebo group (33 patients who received a placebo preparation). The inflammation level of H. pylori infiltration and the eradication rates were evaluated endoscopically and with the urea breath test (UBT) in both groups before and after administering the medication. The serum cytokine levels (tumor necrosis factor-α, and interleukin [IL]-1β and IL-6) were compared in both groups before and after administering the medication.ResultsComplete eradication was not observed in either group. Moreover, there was no significant change in the UBT and updated Sydney score. On the other hand, the β-caryophyllene group showed significant improvement in nausea (p=0.025) and epigastric pain (p=0.018), as well as a decrease in the serum IL-1β levels (p=0.038).Conclusionsβ-caryophyllene improves dyspepsia symptoms and can be considered a useful supplementary treatment for gastrointestinal disease.

This paper considers differences in how economists and novelists view the importance of good and evil in determining social outcomes. As opposed to novelists, economists see the possibility of achieving desirable outcomes through the pursuit of self-interest in markets with good and evil having little influence on that achievement. However, the paper also considers problems with relying on self-interest alone to generate publicly desirable outcomes through markets and points out limits to self-interest in markets. It is argued that novels and literature are a time-tested way of promoting the moral education necessary for well-functioning markets. Attention is turned to the similarities between Adam Smith's theory of moral sentiments and the novels of Jane Austen on the means by which people are able to transcend narrow self-interest in ways that improve both economic and social outcomes.

Labour, like all other things which are purchased and sold, and which may be increased or diminished in quantity, has its … market price. David Ricardo Professional football players earn more than ministers or nurses. Social workers with college degrees generally earn less than truck drivers, who may not have completed high school. Even the best full professor of history probably earns less than a mediocre assistant professor of accounting on most campuses. Why do different occupations offer different salaries? Obviously not because of their relative worth to us as individuals. Just as there is a market for final goods and services – calculators, automobiles, and dry cleaning – there is a market for labor as a resource in the production process. In competitive labor markets, supply and demand are major forces determining the wage rate workers receive in different sublabor markets. And accounting and history professors are in decidedly distinct sublabor markets, because neither can do the other's jobs (or else some (hardly all) history professors might seek an accounting professorship to double or even triple their salaries). By concentrating on the economic determinants of employment – those that relate most directly to production and promotion of a product – we do not mean to suggest that other factors are unimportant. Many noneconomic forces – such as social status, appearance, sex, race, and personal acquaintances – influence who is employed at what wage. Our purpose is simply to show how economic forces affect the wages paid and the number of employees hired. Such a model can show not only how labor markets work but also how attempts to legislate wages, such as minimum-wage laws, affect the labor market. As noted in Chapter 3, the general principles that govern product markets govern labor markets, and the general principles that govern labor markets also apply to the markets for other resources, principally land and capital. The use of land and capital has a price, called rent or interest , which is determined by supply and demand. Furthermore, land, capital, and labor are all subject to the law of diminishing marginal returns. Beyond a certain point and given a fixed quantity of at least one resource, more land, labor, or capital will produce less and less additional output.

What is the best tax structure? Neither pundits and politicians nor economists can say for certain. Many have suggestions, but in reality there is no one tax system that will work for every state, let alone every municipality. The reason is simple: The broader policy environments underlying tax systems change over time. This chapter offers a radical tax reform proposal to address the impending state fiscal crisis. Key takeaways: (1) Federal taxation should be replaced with “Tiebout taxation,” where all taxes would be collected by the states and a uniform percentage of the state revenue would be given to the federal government. (2) Tiebout taxation won’t reveal the ideal tax code, but it will create fiscal incentives that will help by decentralizing the power to tax.

Behavioral economists recognize that we are all subject to the cognitive biases they have observed and studied in laboratory experiments. Yet the leading behavioral economists exhibit far more interest in applying those biases to market decisions than to political decision-, and see irrational decisions making as another example of market failure which justifies correction by some form of government action. We treat this as a justification for comparing the distortions of cognitive biases on market decisions with the distortions of those biases on political decisions. We also make a distinction between the rationality of individual decisions and the collective rationality of those decisions, and question Thaler’s argument that people fail to learn much from the mistakes they make in markets. We conclude that behavioral economists would do more to increase economic rationality by making the case for eliminating government policies that are clearly economically irrational and destructive. Eliminating such policies would not necessarily increase the individual rationality of political or market decisions, but it would increase the collective rationality of both.

We consider a test of expressive voting developed by Brennan and Lomasky (1993). They point out that in presidential elections the probability of a tie, and casting a decisive vote, increases “multi-billionfold” as the election becomes increasingly close. They conjecture that if voters are instrumentally motivated there would be enormous increases in voter turnout for presidential elections as they became close. When they find no consistent relationship between closeness and turnout in presidential elections since 1940, they conclude their test justifies a “decisive rejection of the instrumental voter hypothesis.” As dramatic as such a “multi-billionfold” increase is, we argue it would not motivate voting if an instrumental payoff was the only motivation for doing so. The Brennan–Lomasky test does give the correct result, but not for the reason they emphasize. They do see reasons why voting turnout would be moderated other than the dramatic probability of a decisive vote in close elections. Furthermore, they close their test by indicating that one reason turnout might be higher in close elections is that they are more interesting, which is congenial to an expressive account. We agree. We also argue that the observed tendency for voters to confirm their biases rather than change their minds provides additional support for expressive voting.

Now in its third edition, this textbook develops the economic way of thinking through problems that MBA students will find relevant to their career goals. Theory and mathematics are kept as simple as possible and illustrated with real-life scenarios. The textbook package includes online video tutorials on key concepts and complex arguments, and topics likely to be assessed in exams. The distinguished author team has developed this textbook over twenty years of teaching microeconomics to MBA students. Chapters are clearly structured to support learning: Part I of each chapter develops key economic principles, whilst Part II draws on those principles to discuss organizational and incentive issues in management and focuses on solving the 'principal-agent' problem to maximize the profitability of the firm - lessons that can be applied to problems MBA students will face in the future. Economics and management are treated equally; this unique textbook presents economics as part of the everyday thinking of business people.

The passing of Robert D. (''Bob'') Tollison obviously was a great loss to the economics profession, to public choice and to his many friends and admirers.For those who knew Bob as a colleague, a close friend, and an inspiration, his death was a shock and will leave a lingering hurt.I knew Bob had some health issues, but who doesn't after having passed their three score and ten.But he went too suddenly for someone who was still a prodigious scholar, who had so much more to contribute and look forward to, and who projected such a sense of invincibility.It was his powers as an economist, the creativity and consistency exhibited in his scholarship, and his joy in his family and friendships, that are vivid in my memories of Bob.Bob was a brilliant scholar, but there was a methodological consistency in his work that is rare even among the best of them.Whether he, like Gordon Tullock, was a natural economist who grew up seeing self-interest as the overriding human motivation, or came to this view from his economics training, I can't answer.But I never saw any indication of Bob wavering in the slightest from the power of self-interest in explaining human behavior.Indeed, Bob would seize on opportunities to defend the assumption of self-interest even when most would have considered it safe to pass on such occasions, or to be more ''reasonable.''I remember one of the Wednesday night seminars at the Public Choice Center in Blacksburg when Jim Buchanan challenged a guest speaker (I don't remember who) for assuming self-interest when it was not, according to Buchanan, appropriate to do so.The issue may have been expressive voting, but again I don't remember.What I do remember is Bob challenging Jim with words to the effect that, I learned from you that people are just as motivated by self-interest when making political decisions as when making market decisions, and I'm sticking with that view whether you do or not.Being new to the Public Choice Center at the time, but having heard of Jim's temper, I was impressed with Bob's courage, and went on full alert.But Jim responded graciously, the seminar continued and my heart rate returned to normal.