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NINETEENTH
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Economics
Today
The Macro View
Roger LeRoy Miller

Research Professor of Economics,
University of Texas-Arlington
New York, NY

Dedication To Albert Starr,
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curiosity continue to amaze me
(and everyone else, too).
It’s an honor to know you.
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Cataloging-in-Publication Data is on file at the Library of Congress

1 16
ISBN 10: 0-13-447876-2

ISBN 13: 978-0-13-447876-0

BRI EF CON TENT S
Preface xvi
PART 1 Introduction
1 The Nature of Economics 1
2 Scarcity and the World of Trade-Offs 27
3 Demand and Supply 49
4 Extensions of Demand and Supply Analysis 75
5 Public Spending and Public Choice 100
6 Funding the Public Sector 124
PART 2 Introduction to Macroeconomics and Economic Growth

7 The Macroeconomy: Unemployment, Inflation, and Deflation 142
8 Measuring the Economy’s Performance 164
9 Global Economic Growth and Development 189
PART 3 Real GDP Determination and Fiscal Policy
10 Real GDP and the Price Level in the Long Run 212
11 Classical and Keynesian Macro Analyses 232
12 Consumption, Real GDP, and the Multiplier 253
13 Fiscal Policy 281
14 Deficit Spending and the Public Debt 303
PART 4 Money, Stabilization, and Growth

15 Money, Banking, and Central Banking 322
16 Domestic and International Dimensions of Monetary Policy 349
17 Stabilization in an Integrated World Economy 374
18 Policies and Prospects for Global Economic Growth 397
PART 8 Global Economics

32 Comparative Advantage and the Open Economy 710
33 Exchange Rates and the Balance of Payments 732
ix

C O NTENTS
Preface xvi
PART 1 Introduction
EXAMPLE
Microeconomic and Macroeconomic
1 The Nature of Economics 1
Implications of the Gig Economy 3 The Power of Economic Analysis 2 • The Three Basic Economic Questions and Two
Getting Directions 8
Opposing Sets of Answers 4
INTERNATIONAL POLICY WHAT IF… the government increases pharmaceutical companies’ costs but prevents them
EXAMPLE from raising their prices? 5
Greece Discovers That Higher Tax Rates The Economic Approach: Systematic Decisions 6 • Economics as a Science 7
Encourage More Tax Evasion 6 • Positive versus Normative Economics 10
BEHAVIORAL EXAMPLE YOU ARE THERE The Incentive to Understand Chickens’ “Speech” 11
Why Doesn’t Higher Pay Persuade Some ISSUES & APPLICATIONS Why More Highly Educated Women Are Having More
Women to Avoid Traditional Gender Children 12
Roles? 7
Summary: What You Should Know/Where to Go to Practice 13 • Problems 14
• References 17
APPENDIX A Reading and Working with Graphs 18
Direct and Inverse Relationships 18 • Constructing a Graph 19 • Graphing Numbers
in a Table 20 • The Slope of a Line (A Linear Curve) 22 • Summary: What You
Should Know/Where to Go to Practice 25 • Problems 26
EXAMPLE 2 Scarcity and the World of Trade-Offs 27

The Airline Industry Confronts the Law Scarcity 28 • Opportunity Cost, Trade-Offs, and Choices 30 • The Economic
of Increasing Additional Cost 36 Choices a Nation’s People Face 33 • Economic Growth, Production Possibilities, and
POLICY EXAMPLE the Trade-Off between Present and Future 37
Why the “Free File” Tax Service Is Not WHAT IF… the U.S. government continues to ratchet up required production of health care
Really “Free” 30 services? 39
INTERNATIONAL EXAMPLE Specialization, Comparative Advantage, and Trade 39
The Substantial Trade-Off of Satisfying YOU ARE THERE Reducing the Opportunity Cost of Waiting in Gridlocked Traffic, at a
U.N. Development Goals 34 Price 42
BEHAVIORAL EXAMPLE ISSUES & APPLICATIONS The U.S. Navy Expands Production Possibilities via a New
An Economic Explanation for Technology 42
Monogamy 32
• References 48
EXAMPLE 3 Demand and Supply 49

The Law of Demand in the Market for Demand 50 • Shifts in Demand 55 • Supply 59 • Shifts in Supply 62 • Putting
Cable TV Subscriptions 51 Demand and Supply Together 65
Altered Tastes and Preferences
Generate Lower Demand for Chewing
WHAT IF… the government requires buyers to pay a price that is above the equilibrium
Gum 57 price? 68
Long Lines at Restaurants Special- YOU ARE THERE The Breakfast Cereal Industry Confronts Changing Tastes and Prefer-
izing in Barbecued Brisket Signal a ences 69
Shortage 67
ISSUES & APPLICATIONS The U.S. Oil Gusher Produces Shortages of Oil Storage
POLICY EXAMPLE
Space 70
Policies Generate Higher Water Input
Costs and Cut Agricultural Commodity
Supplies 64
Should Shortages in the Ticket Market
Be Solved by Scalpers? 68

CONTENTS xi
INTERNATIONAL EXAMPLE Summary: What You Should Know/Where to Go to Practice 71 • Problems 72
A Global Substitution from Coal to • References 74
Natural Gas as an Energy Source 57
An Increase in the Supply of Automo-
biles in China 64
BEHAVIORAL EXAMPLE
Tips and Quality-Adjusted Prices 52
EXAMPLE 4 Extensions of Demand and Supply Analysis 75

Dramatic Responses to Cities’ The Price System and Markets 76 • Changes in Demand and Supply 77 • The
Minimum Wage Hikes: “Zeroing Out” Rationing Function of Prices 80 • Price Ceilings 82
Employment 88
WHAT IF… the government requires apartment owners to set rents based on tenants’ in-
POLICY EXAMPLE comes? 85
Rationing Water 81
Price Floors and Quantity Restrictions 85
Regulating the Raisin Reserve 93
YOU ARE THERE Price Rationing via Changes in the Number of Items Sold in a Package 90
INTERNATIONAL EXAMPLE
Why Are Global Ship Rental Prices ISSUES & APPLICATIONS Online Middlemen: Customer Sales Reps Move to the Web 90
Dropping? 80 Summary: What You Should Know/Where to Go to Practice 91 • Problems 92
INTERNATIONAL POLICY • References 95
EXAMPLE APPENDIX B Consumer Surplus, Producer Surplus, and Gains from Trade within a Price
Looking for Hard-to-Find Items in Ven- System 96
ezuela? Ask for the Bachaqueros 83 Consumer Surplus 96 • Producer Surplus 97 • Gains from Trade within a Price
The European Union Decides That the System 98 • Price Controls and Gains from Trade 99
Costs of Milk Quotas Outweigh the
Benefits 89
BEHAVIORAL EXAMPLE
Online Dating Sites and Virtual
Roses 77
EXAMPLE 5 Public Spending and Public Choice 100

Medicare’s “1 Percent” 112 Market Failures and Externalities 101
POLICY EXAMPLE WHAT IF… the government engages in policies that force down the price of an item subject to
That Noisy Drone Hovering by Your external benefits while leaving its supply curve’s position unchanged? 105
House? Your Property Rights Are The Other Economic Functions of Government 105 • The Political Functions
Unclear 102
of Government 108 • Public Spending and Transfer Programs 109 • Collective
Mixed Public Choice Incentives and Decision Making: The Theory of Public Choice 114
Policies for School Lunches 115
YOU ARE THERE Addressing Rail-Freight Transportation Externalities 116
INTERNATIONAL POLICY
EXAMPLE ISSUES & APPLICATIONS The U.S. Measles Threat––Once Nearly Eliminated but Less So
Is Regulation the Solution for Today 117
an Expanding Cloud of Orbital Summary: What You Should Know/Where to Go to Practice 118 • Problems 119
Pollution? 104 • References 122
BEHAVIORAL EXAMPLE
Funding Public Goods: Differences in
Valuations versus Competencies 108
EXAMPLE 6 Funding the Public Sector 124

The Progressive U.S. Income Tax Paying for the Public Sector: Systems of Taxation 125
System 126
WHAT IF… borrowing to fund public expenditures was illegal? 125
POLICY EXAMPLE The Most Important Federal Taxes 127 • Tax Rates and Tax Revenues 131
Inducing Disability Insurance • Taxation from the Point of View of Producers and Consumers 134
Recipients Not to Work Causes
Payouts to Exceed Taxes 130 YOU ARE THERE Mergers Move U.S. Firms Abroad and Reduce the U.S. Income Tax Base 136
Are Vehicle User Fees an Inevitable ISSUES & APPLICATIONS Will Taxing “Remote Sales” Be a Salvation for Sinking State
Replacement for Gasoline Excise Budgets? 137
Taxes? 131
North Carolina Cuts Tax Rates and
Expands a Tax Base, and Its Revenue
Increase 133

xii CONTENTS
BEHAVIORAL EXAMPLE Summary: What You Should Know/Where to Go to Practice 138 • Problems 139
Trying to Boost Government Tax • References 141
Receipts by Making Tax Delinquents
Feel Bad 134
PART 2 Introduction to Macroeconomics and Economic Growth
EXAMPLE 7 The Macroeconomy: Unemployment, Inflation, and

An Increase in the Duration Deflation 142
of Unemployment 146 Unemployment 143 • The Major Types of Unemployment 147
Why a Drop in “Routine Jobs” WHAT IF… the government requires businesses to provide their employees with a wider range of
Is Elevating the Natural Rate of benefits, such as broader health insurance and longer parental leaves? 147
Unemployment 148
Inflation and Deflation 149 • Anticipated Versus Unanticipated Inflation 153
POLICY EXAMPLE • Changing Inflation and Unemployment: Business Fluctuations 155
How High One’s Price-Level-Adjusted
YOU ARE THERE Is the Level of Prices Rising in Russia? Take a Look at the “Borscht
Income Is Depends on Where One
Lives 151
Index” 157
INTERNATIONAL EXAMPLE ISSUES & APPLICATIONS Interpreting Employment Data as the Gig Economy Grows 158
How Variations in Prices of Imported
Items Can Push Apart the PPI and
• References 163
CPI 152
BEHAVIORAL EXAMPLE
Animal Spirits and Business Fluctuations:
Can Fear Cause Recessions? 157
EXAMPLE 8 Measuring the Economy’s Performance 164

Correcting GDP for Price Index The Simple Circular Flow 165 • National Income Accounting 167 • Two Main
Changes, 2007–2017 178 Methods of Measuring GDP 171
POLICY EXAMPLE WHAT IF… a nation’s measure of aggregate economic activity were based on production using
Accuracy versus Precision in Measur- inputs that its residents own and operate in other countries? 173
ing Business Fixed Investment 172
• Other Components of National Income Accounting 176 • Distinguishing Between
INTERNATIONAL EXAMPLE Nominal and Real Values 178
Complications in Assessing the GDP YOU ARE THERE Redesigning GDP to Take into Account the Treatment of Natural
Effects of the “Free Web” 169
Resources? 181
Purchasing Power Parity Comparisons
of World Incomes 181 ISSUES & APPLICATIONS How Big Is the Underground Economy? 182
BEHAVIORAL EXAMPLE • References 188
Should an Economic “Dashboard”
Supplement or Replace GDP? 170
POLICY EXAMPLE 9 Global Economic Growth and Development 189

An Annual Quota on Importing Human How Do We Define Economic Growth? 190
Capital Fills Up in a Hurry 198
WHAT IF… from the perspective of the rule of 70, China and India were able to maintain their high
INTERNATIONAL EXAMPLE rates of per capita real GDP growth over the next couple of decades? 194
Growth Rates around the World 191 Productivity Growth, Saving, and New Technologies: Fundamental Determinants of
A Youth Shrinkage and Aging Capital Economic Growth 194 • Immigration, Property Rights, and Growth 199
Contribute to Secular Stagnation in • Economic Development 199 • Are Developed Nations Stuck with Stagnant Growth
Japan 205
Prospects? 203
BEHAVIORAL EXAMPLE YOU ARE THERE Does More Income Inequality Necessarily Harm Economic Growth? 206
Interpersonal Trust and Economic
Growth 197 ISSUES & APPLICATIONS Both Quality and Quantity of Regulations Matter for Economic
Growth 207
• References 211

CONTENTS xiii
PART 3 Real GDP Determination and Fiscal Policy

INTERNATIONAL EXAMPLE 10 Real GDP and the Price Level in the Long Run 212
China’s Long String of Rightward Output Growth and the Long-Run Aggregate Supply Curve 213 • Total Expenditures
Shifts in the LRAS Curve 215 and Aggregate Demand 215 • Long-Run Equilibrium and the Price Level 220
Inferring That South African Aggregate WHAT IF… there are steady and susteined decreases in the prices of key inputs in the production
Demand Growth Dropped after
of energy? 222
2008 224
Causes of Inflation 222
BEHAVIORAL EXAMPLE
Does The “Sentiment” of Consum-
YOU ARE THERE Watching a Crumbling U.S. River System Impede Growth of Aggregate
ers Generate Aggregate Demand Supply 225
Shifts? 219 ISSUES & APPLICATIONS The Implications of U.S. Secular Stagnation for Real GDP and the
Price Level 225
• References 231
EXAMPLE 11 Classical and Keynesian Macro Analyses 232

Why U.S. Nominal Wages Have Been The Classical Model 233 • Keynesian Economics and the Keynesian Short-
Slow to Adjust 239 Run Aggregate Supply Curve 238 • Shifts in the Aggregate Supply Curve 241
BEHAVIORAL EXAMPLE • Consequences of Changes in Aggregate Demand 243 • Explaining Short-Run
Variations in Credit-Market Sentiment Variations in Inflation 245
and Aggregate Demand Stocks 243 WHAT IF… a nation’s economy were to experience demand-pull and cost-push inflation simultane-
ously? 246
YOU ARE THERE A Japanese Economist Tells His Government, “I Told You So!” 247
ISSUES & APPLICATIONS A Minimum Wage Boost Causes a Puerto Rican Aggregate Supply
Shock 248
• References 252
EXAMPLE 12 Consumption, Real GDP, and the Multiplier 253

Why the U.S. Economy’s Saving Rate Determinants of Planned Consumption and Planned Saving 254 • Determinants of
Rises During Recessions 260 Investment 260 • Determining Equilibrium Real GDP 262 • Keynesian Equilibrium
INTERNATIONAL EXAMPLE with Government and the Foreign Sector Added 266
Diminished Rightward Shifts in WHAT IF… real incomes earned by residents of other nations were to increase? 268
Germany’s Investment Function 264
The Multiplier, Total Expenditures, and Aggregate Demand 268
BEHAVIORAL EXAMPLE YOU ARE THERE Inferring Low Real GDP Growth from “Restrained” Consumption
Habit Formation in Consumption Spending 273
Spending and the Multiplier
Effect 270 ISSUES & APPLICATIONS An Investment Spending Slowdown Holds Down U.S. Real
GDP 274
• References 279
APPENDIX C The Keynesian Model and the Multiplier 280
INTERNATIONAL POLICY 13 Fiscal Policy 281

EXAMPLE Discretionary Fiscal Policy 282 • Possible Offsets to Fiscal Policy 284
Higher Government Research and
Development Generates Offsetting
WHAT IF… a nation’s government were to find itself to the right of the top of the Laffer
Spending Cuts 288 curve? 289
Discretionary Fiscal Policy in Practice: Coping with Time Lags 289 • Automatic
BEHAVIORAL EXAMPLE
Stabilizers 291
Bounded Rationality and Variations
in the Effects of Fiscal Policy on Real YOU ARE THERE Why Are Several States Cutting the Duration of Unemployment
GDP 291 Compensation? 292
ISSUES & APPLICATIONS Which Governments Conduct Fiscal Stabilization Most
Effectively? 293
• References 299

xiv CONTENTS
APPENDIX D Fiscal Policy: A Keynesian Perspective 300

Changes in Government Spending 300 • Changes in Taxes 301 • The Balanced-
Budget Multiplier 301 • The Fixed Price Level Assumption 302 • Problems 302
POLICY EXAMPLE 14 Deficit Spending and the Public Debt 303

Increasing Costs of Student Loan For- Public Deficits and Debts 304 • Evaluating the Rising Public Debt 307
giveness Are Raising Federal Budget Growing U.S. Government Deficits: Implications for U.S. Economic
Deficits 306 Performance 311 • How Could the Government Reduce All of Its Red Ink? 313
INTERNATIONAL EXAMPLE WHAT IF… the rich were to respond to higher average and marginal income tax rates by engaging
What Nations’ Residents Have the in fewer activities subject to taxation? 314
Largest Holdings of the U.S. Public
Debt? 311 YOU ARE THERE Want a Balanced Budget? Sell Some Government Assets 316
BEHAVIORAL EXAMPLE ISSUES & APPLICATIONS Is Fiscal Policy Drowning in Accumulated Budgetary Red Ink? 316
Will Taxpayers Eventually Force Summary: What You Should Know/Where to Go to Practice 318 • Problems 319
Government Spending Cuts? 307 • References 321
PART 4 Money, Stabilization, and Growth

EXAMPLE 15 Money, Banking, and Central Banking 322
Customers Pay Fees to Hold Hundreds Functions and Measures of Money 323
of Billions in Deposits at Banks 330
WHAT IF… a type of asset that previously had been regularly exchanged in active trading suddenly
INTERNATIONAL EXAMPLE experiences a long period of hardly any transactions? 325
Why Bother with a Debit Card • Financial Intermediation and Banks 328 • The Federal Reserve System: The U.S.
When Payments Can Accompany Central Bank 332 • Fractional Reserve Banking, the Federal Reserve, and the Money
“Tweets”? 332 Supply 335 • Federal Deposit Insurance 339
INTERNATIONAL POLICY YOU ARE THERE In Europe, Some Borrowers Receive Bank Interest Payments on Their
EXAMPLE Loans 342
What Does Zimbabwe Now Use as
ISSUES & APPLICATIONS Why U.S. Taxpayers are Last-Resort Funders of Much of the
Money, and Why? 326
Financial Industry 343
BEHAVIORAL EXAMPLE Summary: What You Should Know/Where to Go to Practice 344 • Problems 346
Is Money Really Just for “Record • References 348
Keeping”? 324
EXAMPLE 16 Domestic and International Dimensions of Monetary

Interest Rate Movements and U.S.
Companies’ Cash Holdings 352
Policy 349
The Demand for Money 350 • How the Fed Influences Interest Rates 352 • Effects
BEHAVIORAL EXAMPLE of an Increase in the Money Supply 354
Can Behavioral Economics Explain the
WHAT IF… Federal Reserve policies generate a higher level of interest rates intended in part to
Federal Reserve’s Bad Forecasts? 359
influence bank lending? 356
Monetary Policy and Inflation 357 • Monetary Policy Transmission and Credit Policy
at Today’s Fed 359
YOU ARE THERE A Member of Congress Seeks a Fed Policy Rule, Irrespective of the Rule’s
Name 365
ISSUES & APPLICATIONS Do Federal Open Market Committee “Dot Plots” Chart
Confusion? 365
• References 370
APPENDIX E Monetary Policy: A Keynesian Perspective 371
Increasing the Money Supply 372 • Decreasing the Money Supply 372 • Arguments
against Monetary Policy 372 • Problems 372

CONTENTS xv
POLICY EXAMPLE 17 Stabilization in an Integrated World Economy 374
Policy Uncertainty and Reduced Total Active Versus Passive Policymaking and the Natural Rate of Unemployment 375
Planned Expenditures 378 The Phillips Curve: A Rationale for Active Policymaking? 379 • Rational
What Policy-Relevant Inflation Rate Expectations, the Policy Irrelevance Proposition, and Real Business Cycles 382
Should the Public Try to Predict? 388
WHAT IF… the Federal Reserve were to engage in a policy action that the public is unable to antici-
BEHAVIORAL EXAMPLE pate and therefore surprises all firms and households? 383
Do Distorted Beliefs Influence Modern Approaches to Justifying Active Policymaking 384 • Behavioral Economics
Real GDP and the Unemployment
and Macroeconomic Policymaking 388
Rate? 389
YOU ARE THERE Are National Inflation Rates Mysteriously “Too Low”? 390
ISSUES & APPLICATIONS Does the Usual Phillips Curve Consider the Wrong Unemployment
Rate? 391
• References 396
INTERNATIONAL POLICY 18 Policies and Prospects for Global Economic Growth 397
EXAMPLE Labor Resources and Economic Growth 398 • Capital Goods and Economic
Indian Farmers Confront “Dead Land” Growth 400 • A Recent Shift in Global Growth Trends 401 • Private International
Problems 401 Financial Flows as a Source of Global Growth 404 • International Institutions and
INTERNATIONAL EXAMPLE Policies for Global Growth 406
Myanmar Ends Monopolies’ Control of WHAT IF… the World Bank and the IMF were to face competition from new international lending
Financial Information to Spur Foreign institutions? 408
Investment 405
YOU ARE THERE Will Renewable Energy “Leapfrog” African Nations to Higher Economic
BEHAVIORAL EXAMPLE Growth? 409
Nudging the World’s Poor to Make
Different Choices 399 ISSUES & APPLICATIONS China’s One-Child Policy Relaxed––To Promote Economic
Growth 409
Summary: What You Should Know/Where to Go to Practice 410 • Problems 412 •
References 415
PART 8 Global Economics

POLICY EXAMPLE 32 Comparative Advantage and the Open Economy 710
Ending the U.S. Oil Export Ban 722 Why We Trade: Comparative Advantage and Mutual Gains from Exchange 711
INTERNATIONAL EXAMPLE • Arguments Against Free Trade 718 • Ways to Restrict Foreign Trade 721
How African Nations Are Developing • International Trade Organizations 724
Comparative Advantages in WHAT IF… joining a new regional trade bloc shifts existing trade to countries within that bloc and
Agriculture 716 away from countries in another regional trade bloc? 725
Why European Firms View
YOU ARE THERE Argentina Specializes in Oil Production to Protect Domestic Jobs 726
Chinese Tourists’ Parallel Imports
as a Threat 719 ISSUES & APPLICATIONS Drought Induces California Farmers to Double Down on a
Comparative Advantage 726
BEHAVIORAL EXAMPLE
Has Greater Financial Uncertainty
• References 731
Become an Impediment to Trade? 721
EXAMPLE 33 Exchange Rates and the Balance of Payments 732

Harley-Davidson’s Sales of The Balance of Payments and International Financial Flows 733 • Deriving the
Motorcycles Are Reduced by the Demand for and Supply of Foreign Exchange 738 • Determining Foreign Exchange
Strong Dollar 742 Rates 742 • Fixed Versus Floating Exchange Rates 745
BEHAVIORAL EXAMPLE WHAT IF… a central bank that fixes its nation’s exchange rate runs out of foreign exchange
Can Behavioral Economics Help reserves? 748
Nations Achieve Balanced Trade? 746
YOU ARE THERE Nigeria’s Central Bank Forces a Reduction in the Demand for Foreign
Exchange 749
ISSUES & APPLICATIONS A Year of an Appreciation, Lower Import Prices, and Higher Quantity
of Foreign Exchange Demanded 750
• References 754
Glossary G-1
Index I-1

PREFACE
How do we motivate students in economics? I believe that we should present them

with economic explanations for what is happening around them and throughout the
world. Theory may be the backbone of our discipline, but its application is the only
way we can help our students understand the importance of economics in their daily
lives and for their futures.
New and Increased Emphasis on Behavioral

Economics
The theory of bounded rationality forms the basis of behavioral economics. This
theory is expanded upon in the introductory chapter, and in many other chapters.
More importantly, in keeping with the desire to show the applicability of theory,
every single chapter in the 19th edition has a behavioral economics example.
New Additional End-of-Chapter Problems

In this 19th edition, you will find six to eight new problems at the end of each
chapter. Many are based on the interactive graphs within the chapter. They require
students to apply their critical thinking skills learned from the chapter.
New Questions in MyEconLab

With the 19th edition, we have added close to 500 new assignable questions
in MyEconLab, expanding the database of questions to an average of over 100
questions per chapter.
MyEconLab—Getting Better with Each Edition

• Figure Animations: Figure animations provide a step-by-step walk-through of
select figures. Seventy percent of all figures are animated. Figure animations have
been updated to reflect changes to the 19th edition.
• Concept Checks: Each section of each learning objective concludes with an on-
line Concept Check that contains one or two multiple-choice, true/false, or fill-in
questions. These checks act as “speed bumps” that encourage students to stop and
check their understanding of fundamental terms and concepts before moving on
to the next section. The goal of this digital resource is to help students assess their
progress on a section-by-section basis, so they can be better prepared for home-
work, quizzes, and exams.
• Graphs Updated with Real-Time Data from FRED®: Data graphs in the eText
are continually updated with the latest data from FRED®, which is a comprehen-
sive, up-to-date data set from the Federal Reserve Bank of St. Louis. Students can
display a pop-up graph that shows new data plotted in the graph. The goal of this
digital feature is to provide students with the most current macro data available
so that they can observe the changing impacts of these important variables on the
economy.
Assessments using current macro data help students understand changes in
economic variables and their impact on the economy. Real-time data analysis
exercises in MyEconLab also communicate directly with the Federal Reserve
Bank of St. Louis’s FRED® site and automatically update as new data are available.
xvi

PREFACE xvii
These exercises allow students to practice with data to better understand the current economic
environment.
42 PART 1 | INTRODUCTION
• Self Checks: Self Checks appear at the end of every Learning Objective section. Self Check ques-
tions allow students to check their understanding ofsomewhere else in the country,
the key concepts they just U.S.reademployment
beforewould moving decline. That has never
happened and never will.
on. All questions and answers are available in MyEconLab. When nations specialize in an area of comparative advantage and then trade with the
• Dynamic Study Modules: Dynamic Study Modules, restavailable
of the world,within MyEconLab,
the average standard of living continuously
in the world rises. In effect, interna-
S E L F CH E C K tional trade allows the world to move from inside the global production possibilities
assess student performance on key topics in real time, and provide additional and personalized
curve toward the curve itself, thereby improving worldwide economic efficiency. Thus,
Visit MyEconLab
practice content. Dynamic Study Modules exist for every chapter andinare
to practice
all countries that engage tradeavailable on all
can benefit from mobileadvantage, just as regions
comparative
problems and to get instant
devices for on-the-go studying.
feedback in your Study Plan.
in the United States benefit from interregional trade. MyEconLab Concept Check
MyEconLab Study Plan
• Digital Interactives: Digital Interactives are dynamic and engaging assessment activities that pro-
mote critical thinking and application of key economic principles. Each Digital Interactive has 3–5
progressive levels and requires
Y O Uapproximately
A R E T H E R E20 minutes to explore, apply, compare, and analyze
each topic. Many Digital Interactives include real-time data from FRED®, allowing professors and
Reducing the Opportunity Cost of Waiting in Gridlocked Traffic, at a Price
students to display, in graph and table form, up-to-the-minute data on key macro variables. Digital
Interactives can be assignedFourand graded
decades within
ago, Howard Becker,MyEconLab, or used
founder of Becker Automotive, Inc., as a lecture
including tool
clients, to encourage
personal assistants, or secretarial support staff.
started a Los Angeles business installing sound systems in homes Thus, buyers of Becker’s converted vans and limos can, while paying
engagement, classroom conversation, and group
and vehicles. His company work.
is still based in that area, but now it spe- chauffeurs to traverse the thick traffic, avoid sacrificing time that they
• Learning Catalytics®: Learning
cializes in Catalytics ® generates
reducing the opportunity cost of theclassroom discussion,
hours that people could devoteguides lectures,
to activities and
they otherwise would pursue at home or in an
spend traversing congested highways and surface roads. Becker’s office setting.
promotes peer-to-peer learning with real-time analytics. Now students can use any device to inter-
customers are individuals who had previously been among U.S. com-
act in the classroom, engage with
muters whocontent, and 7even
devote a combined billion draw
hours perand share graphs.
year self-driving CRITICAL THINKING QUESTIONS
• Enhanced eText for MyEconLab: The Pearson eText for MyEconLab1. gives
their vehicles slowly through nearly gridlocked traffic instead of pur- How muststudents access
the dollar values to
of the opportunity costs of time compare
suing other activities. for a typical purchaser of a vehicle converted by Becker Automotive,
their textbook anytime, anywhere.At prices In
that addition
typically start to note-taking,
at $150,000, Becker’s firmhighlighting,
converts Inc.,and
versusbookmarking, the them? Explain briefly.
commuters who do not purchase
Pearson eText offers interactive and sharing
chauffeur-driven features.
vans and limos into mobile offices or custom-built 2. Why do you suppose that economists have estimated the dollar value
homes away from home. Becker’s converted vehicles provide amenities of the combined opportunity costs of time that U.S. commuters spend
that include built-in touchscreen devices with remote access to cloud- in gridlocked traffic to be in excess of $150 billion per year? Explain
based information networks and home-film library systems, bathrooms, your reasoning.
and even exercise bicycles. Many vehicles provide sufficient seating—
Continuing Emphasis on Public Policy and, if desired, accessories and equipment—for several passengers, Sources are listed at the end of this chapter.
Public policy issues concern your students just as they concern everyone else. Much of the theory
throughout this text relates to exactly how changing public policies affect all of us.
• In Chapter 2, read-
ers will find out
why “free” tax-filing
ISSUES &
Specialist 2nd Class Kristopher Kirsop/Released
services from the IRS

really aren’t free.
APPLICATIONS
U.S. Navy photo by Mass Communication
• When water becomes

scarcer because of
droughts, how politi- The U.S. Navy Expands
cians respond affects
everyone, as your
Production Possibilities
students will read in via a New Technology
Chapter 4.
• Poorly defined prop- CONCEPTS APPLIED The U.S. Navy faces an on-going task of producing ship-borne weapons that
deliver explosive forces to remote targets. At the same time, the Navy is
erty rights to airspace Production Possibilities
seeking to expand its fleet of ships afloat. Consequently, the Navy faces an
occupied by drones is Production Possibilities economic problem involving production possibilities.
an issue addressed in Curve
Chapter 5 Technology
M02_MILL8777_19_SE_C02.indd 42 24/10/16 4:36 PM

THE CONTINUING QUEST TO KEEP
STUDENT INTEREST HIGH
From the very beginning, Economics Today was created to maintain high interest by its read-
ers. Many of the pedagogical devices developed in earlier editions have been perfected and
the content for this 19th edition is completely new. They include:
• A chapter-opening vignette about a serious application of each chapter’s theory
with a continuing Issues & Applications feature at the end of every chapter. All of
these are new to this edition.
• Learning Objectives accompany each major chapter section to help focus
6 Funding the Public Sector
student reading comprehension and allow for self-assessment to ensure that

students have grasped key concepts.
• A “grabber” Did You Know That … feature starts off every chapter. All of these
are new. | CHAPTER 6 Funding the Public Sector 137
ISSUES &
APPLICATIONS
imageegami/Fotolia
Will Taxing “Remote Sales”
imageegami/Fotolia
Be a Salvation for Sinking
A
few years ago, California began taxing remote
LEARNING OBJECTIVES
| State Budgets?
sales—revenues of firms based outside the
After reading this chapter, you should be state but with a sufficient physical presence
CHAPTER 32 Comparative Advantage and the Open Economy 711 able to: within the state to permit taxation of their California
6.1 Distinguish between average tax rates and sales under federal law. Some forecasts had indicated
CONCEPTS APPLIED marginal tax rates
For years, states rarely collected from sellers the sales taxes on out-of-state that the state would bring in about $450 million in
DID YOU KNOW THAT… purchases that consumers made by mail or via orders placed online.
tax system
6.2 Explain the structure of the U.S. income additional sales tax revenues via taxation of remote
the Midwestern U.S. states are endowed with 80 percent of the
Static Tax fresh
Analysis
Although many states technically required consumers to file6.3
special forms the
Understand to key factors influencing the
sales. In fact, the additional revenues generated by
extending sales taxes to California-based revenues of
water available in the United States and with 20 percent of the fresh water in existenceDynamic
on the Tax
planet? In
Analysis relationship between tax rates and the tax
pay “use taxes” on such purchases, few consumers followed through, and out-of-state firms amounted to closer to $100 million.
revenues governments collect
recent years, residents of these states have been developing techniques for transferring some of this water to states determined that the costs of collecting those taxes outweighed
6.4 Explainthe
how the taxes governments levy on
A number of other states recently have implemented
Tax Base their own remote sales taxes. Many of these states are,
people residing in other U.S. states and even to residents of other nations. By specializing in water- purchases of goods and services affect
extra revenues. Recently, however, a number of states have changed course like California several years ago, anticipating signifi-
market prices and equilibrium quantities
redistribution technologies, these Midwestern residents hope to engage in trade of fresh water for other goods and begun trying to collect sales taxes on the “remote sales” that out-of- cant increases in tax collections. In this chapter, you
MyEconLab helps you master each CHAPTER
objective and 3 | Demand
will learn whyand
mostSupply 51
economists predict that the states
and services with people living in locations hundreds and even thousands of miles away. state firms make to residents of their states. study more efficiently. See end of chapter for details.
are overestimating gains in revenues from taxation of
The law of demand is supported by millions of observations of people’s behavior in remote sales.
The Trend Toward Morethe marketplace.

State Taxation Theoretically,
of A key itinducement
can be derived from
for states an economic
to initiate efforts tomodel
tax based on
Remote Sales rational behavior, as was remotediscussed salesinhas
Chapter 1. Basically,
been estimates 124if nothing
of revenues “lost” else
fromchanges and
the price of a good falls, failure
the to doprice
lower so in the past. The
induces us National
to buy Council
more of Statewe can enjoy
because
Why We Trade: Comparative Advantage and
In recent years, state governments in California, Massa- Legislatures (NCSL), for instance, has estimated that not
32.1
chusetts, Michigan, New Jersey,additional
Explain
and New York net why
gains
have
nations
that werecan
moved unavailable at the higher price. If you examine your own
gain taxing remote sales has caused the fifty U.S. states to for-
thatfrom specializing in
Mutual Gains from Exchange
aggressively to tax remote sales behavior, you will
out-of-state see that
compa- goitangenerally follows$25
inf lation-adjusted thebillion
law ofperdemand.
year in lost reve-
production
nies make to their residents. A few How
states haveand
has aeven engaging
gone in
change a the in
quantity
nues. The NCSL of cable TV subscriptions
estimate, however, is based in mainly
responseon to a change
M06_MILL8777_19_SE_C06.indd 124 24/10/16 4:56 PM
step further by claiming that international

when
in theanprice
out-of-state
thesefirm
oftrade subscriptions accorded
static tax analysis thatwith the law
presumes of demand?
minuscule tax-base re-
• AYouvariety of been
have already examples
introduced are
to theprovided:
concept of specialization andanymutual
makes sales to gains
their states’ residents, it is subject to
other forms of taxation that the states impose on businesses
ductions for states if consumers respond to the imposi-
from trade in Chapter 2. These concepts are worth repeating because they are essen- tion of tax rates on remote sales by cutting their out-of-
located within their states.
tial to understanding why the world is better off on net because of more international
Tennessee, for example, recentlyEdecided L E out- state
X A MtoPsubject purchases. In fact, Yu Jeffrey Hu and Zhulei Tang of
the Georgia Institute of Technology have found evidence
trade. First, however, let’s take a look at the growing volumes ofof-state
international trade
companies that make sales of $500,000 or more to that the imposition of even a relatively low 4 percent sales
Tennessee residents to the state’s The Law of Demand
corporate-franchise tax. in the Market for Cable TV Subscriptions
undertaken by the world’s peoples in recent years.
DOMESTIC TOPICS AND EVENTS are presented
tax rate on previously untaxed remote sales induces con-
Hence, such firms must pay a tax rate of 0.25 percent on sumers to decrease out-of-state purchases by at least 15
their net worth, even if none of thatBetween 2000
net worth is and 2017,
located or thepercent.
inflation-adjusted
This factaverage
helps to nationwide
explain price
why otherFOR CRITICAL THINKING
dynamic-
through thought-provoking
The Worldwide Importance ofdiscussions, such as:
International Trade owned within Tennessee. The state
even imposed its business and occupation
of Washington
of a cable
tax same
During the
hasroseanalysis
TV subscription
on a trucking
from $30estimates
period, the nationwide
per monthoftothe
number
all fifty states
about
fromoftaxing
$67 perannual
potential
cable TV
month. revenue
subscriptions
remote
Is there
gainsanto inverse relationship between the price of cable TV
subscriptions
sales have ranged from and the number of subscriptions that people purchase?
firm simply because
Look at panel (a) of Figure 32-1. Since 1960, world output of goods and services it has trucks that have stopped at its
• The Law of Demand in the Market for Cable TV declined from more than 68 one-half
million to to one-sixth
just over 50 of the
million. NCSL
Thus, estimate. Explain.
consistent
highway weigh stations while making delivery trips that
(world real gross domestic product, or world real GDP) has increased almost
have crossed throughevery
the state. with the law of demand, a significant reduction in the number of cable
Subscriptions
year. It is now about 7 times what it was then. Look at the top line in panel (a) of
Figure 32-1. Even taking into account its recent dip, world tradeWillhas increased
Taxing Remote to Sales the inflation-adjusted
Boost
For Critical
TV subscriptions has taken place
Revenuesprice of 1. How
Thinking
in response
cable TV could
to a substantial increase in
subscriptions.
the legal expenses incurred inSources
establishing
are listed at the end of this chapter.
rights to assess remote taxes and the costs that states in-
• Analyzing
more than 16 Tweets
times its to
level in Predict
1960. Stock Market as Swings
Much
The United States has figured prominently in this expansion ofCourts
as
worldaretrade
States
in therelative
Hope?
process of sorting out whether all of the
cur in collecting such taxes cut further into dynamic-anal-
ysis estimates of the net revenue gains to states from im- MyEconLab Concept Check
jurisdictional claims of Tennessee, Washington, and other plementing the taxes?
to GDP. In panel (b) of Figure 32-1, you see annual U.S. imports and exports expressed
states are legally justifiable. A fundamental economic issue, The price
2. Why might pressures of an
to satisfy item maybudget
government also decrease simply because producers have reduced the item’s
constraints
as a percentage of the nation’s total annual yearly income (GDP). Whereas
however, imports
is whether all of these efforts to collect taxes related
Relative | Prices versus Money Prices
quality. incentives
Thus, when evaluating the sales
effects of price changes, we must always compare
give state governments to seek to tax remote
amounted to barely 4 percent of annual U.S. GDP in 1950, today they sales
to remote account for 64firms
of out-of-state really
PART 1 will enable states
INTRODUCTION even if they were
pricetoper
determine that actualunit.
constant-quality net revenues col-
to collect as many additional tax dollars as they anticipate.
The relative price of any commodity is itsbeprice
lected likely would in terms
less than originallyofestimated?
another commodity. The Relative price
more than 15 percent. International trade has become more important to the U.S.
Pprice
O L Ithat
C Y you
E XTABLE
A
payMinP3-1
Ldollars
E and cents for any good or service at any point in time is The money price of one commodity divided
economy, and it may become even more so as other countries loosen their trade by the money price of another commodity;
called its
Policies moneyHigher
Generate price.Water Input Costs and Cut Agricultural Commodity Supplies
restrictions. MyEconLab Concept Check Money Price versus the number of units of one commodity that
IMPORTANT POLICY QUESTIONS help students Large aRelative Price upMoney Price the cost of this key input. must
As be
Relative sacrificed to purchase one unit of
aPrice
THE quantities
RELATIVEofPRICE
number OFofAagricultural
HOUSE You commodities
mightareheargrownfrom
each your
pushed considerably
grandparents, “My first new another consequence,
commodity.
suppliesPrice Price Price Price
The Output Gains from Specialization year The money whoprices of both 6-terabyte cloud large portions
carincost
California.
onlyFarmers
thirty-two
servers
reside in this
hundred
and 6-terabyte
state provide
dollars.” The implication, of
ofagricultural
course, commodities
is that thehave declined in California.
price
cotton,external hard Last Year This Year Last Year This Year
understand
The best waypublic debates,
to understand such
the gains from tradeas:
M06_MILL8777_19_SE_C06.indd 137
among nations is first to understand
of the nation’s almonds,
of cars todaydrives
apples,
is outrageously
oranges,
high
have fallen. The relative
walnuts, and other commodities.
grapes, lemons, rice,
price ofbecause the average new car may
Cloud FOR CRITICAL THINKING $300
cost4:56$32,000.
24/10/16 PM Money price
The price$210
expressed in today’s dollars; also
That, however,
In recent years, both is
thenot
external
U.S. an
hard drives,accurate
however,
government
has comparison.
risen
andofthe servers What do$300
California govern- you suppose has $210
happened to $150 = 2.0of the supply curves
the positions = 1.50
in nominal price.
the output gains from specialization between individuals. Suppose that a creative called the absolute or
$140
• That Noisy Drone Hovering by Your House? Your
(or, conversely, the relative price cloud
ment What wasservers
have responded the price
to severe of the
droughts
has fallen).
averagelarge
by redirecting house during
volumes of that
the same
markets for year? Perhaps
commodities such asitalmonds,
was apples, cotton, oranges,
advertising specialist can come up with two pages of ad copy (written words) an hour only
water $19,000.
away from farmersByincomparison,
favor of city water then,
systems given
External
that
and to rivers the average
and grapes,$150 price
lemons, rice,of
andhouses
$140walnuts? today
$150 is
= 0.50
$140
= 0.67
Property Rights Are artUnclear
hard drives
or generate one computerized rendering per hour. At the same time, a computer closewith
streams to endangered
$190,000, theFarmers
fishes. current haveprice
had to payof much
a new car doesn’t sound so far out of
higher $300 line, $210
art specialist can write one page of ad copy per hour or complete one computerized art prices
doesto it?obtain water for their crops from private sources, which has Sources are listed at the end of this chapter.
• Ending the U.S. Oil ExportcanBan

rendering per hour. Here the ad specialist come up with more pages of ad copy per
COMPARING RELATIVE PRICES OF DIGITAL STORAGE DRIVES The point is that money prices
hour than the computer specialist and seemingly is just as good as the computer
during different time periods PRICEdon’t tell Why
EXPECTATIONS youAischange
a tip often an essential part of an overall quality-adjusted price paid for a service?
much. You
in the have to calculate
expectation of a future relative
relative price of a product
specialist at doing computerized art renderings. Is there any reason for the ad specialist
prices. Consider an example can ofaffect a producer’s
the price current cloud
of 6-terabyte willingnessserversto supply,
versus just theaspriceprice expectations affect
and the computer specialist to “trade”? The answer is yes because such trading will B EHAVIO R AL adrives EXAMPLE
consumer’s current
of 6-terabyte external hard from last yearwillingness
and this year. to purchase.
In TableFor 3-1,example,
we showsuppliers of portable
lead to higher output. the moneyTips prices of powerservers
cloud banks may and withhold
external fromhard the drives
market for part two of their years current supply if they
and Quality-Adjusted Prices
anticipate higher prices in the future. The current amount supplied at each and
during which they have both gone down.
BEHAVIORAL
THE SITUATION WITH NO EXAMPLES
TRADE Consider the introduce behavioral
scenario of no trading. Assume that during This means Alongside
thatthe
the drives.
inexplicit
provision of
today’s
everythat
prices price will decrease.
dollarsconsumers
we have paytoforpay
services
outsuchlessasfor both
are willing
cloud to payservers
for servicesandprovided in a satisfactory way. Firms that al-
each eight-hour day, the ad specialist and the computer whiz devote half of their day external hard If food
we atlook,
restaurants,
though, drinksatatthebars,relative
and taxi services,
prices low employees
suchofaspeople
cloud who provide
servers tax, and
such services to accept tips typically employ
ex-
economics examples
to writing ad copy with provocative
and half to computerized art rendering. questions
The ad specialist would
many consumers of such
ternal hard payments—to
drives, we those findwho
TAXES
that
AND SUBSIDIES
services
last year,
production
commonly extend
cloud
costs
deliver such services. and
Certain
servers
In manytherefore
taxes,
tips—additional
were
instances,reduce
a per-unit
twicetipping,
there- supply.
as expensive
If the
firms
are effectively
with hard-to-measure
asconsumers
supply
enable
exter-
curvetoispayS1a in
an addition
skills in providing
priceFigure
to By allowing
the services.
3-8,
consistent with the overall
nal hard drives, fore, thewhereas
overall pricesthis year they are only forone and itatohalf timesof theasservice
expensive.
such
create as:
(4 * 1).
eight pages of ad copy (4 hours * 2) and four computerized art renderings Subsidy
Conversely,
A negative tax; a paymentiftowe
turn tocompare
a producer
out be higher than
a per-unit
that
Every
consumers
external
tax
hard
producer
the services’
endincrease
up paying
posteddrives
prices. to
would
wouldtheseshift
getcloud
services
a “gift” servers,
3. A
Squality
from the last
ensures
per-unit
year
government
subsidy
the price
for each
a quality-adjusted
woulddodo
they actually
of unit
price
the opposite.
receive.
produced.
that consumers
That is, tipping behavior
are This
willing to pay for a
from external
the government, usually
hard drives in the
What accountsform of
was for per-unit
50thepercent subsidy
of theofprice
observed behavior wouldofshift
consumers cloud
who theservers,
include curve S2. today
tips todelivered
but service.the price of
• copy
Tips
During and Quality-Adjusted
that same Priceswould create four pages of ad
period, the computer specialist
(4 hours * 1) and four computerized art renderings (4 * 1). Each day, the com-
a cash grant per unit. within overall prices for many services? Some observers have suggested
external hard drives is about 67 percent of the price of cloud servers. In the one-year
FOR
period, although three possible rationales:NUMBER
both prices(1)have attemptsOFbyFIRMS
declined IN
in THE
consumers
money INDUSTRY
to build In the
their own self-
terms, shortCRITICAL
the relative run, when
price ofTHINKING
firms can change only the
exter-
• bined
Why Doesn’t
output Higher
for the ad specialist andPay
copy and eight computerized art renderings.
Persuade
the computer specialistSome
would be 12 pages of ad nal hard drives
esteem by rewarding others,
sense has
of obligation
(2) altruistic motives of consumers,
number of employees they use, we hold the number
risenbyinconsumers.
relation
stant. In Theto
keythat
the
of explanation
economic
long run,
cloud servers.
the for
or (3) a How
tipping, of offirms
number
could
services?
laws that ban tips cause
of firms inathe
may change. If the number of firms
reduction in the quality
industry con-of the delivery
Sometimes relative price changes occur because the qualitysuchtheof a productcurve improves,
Women to Avoid Traditional Gender Roles? thereby bringing
however, starts with
as food atabout
restaurants,
the increases,
fact
a decrease
mixed
that consumers
If thedrinks,
number
supply
inor the
taxiof
who purchase
will
item’s
services
firmsknow
products
increase,
effective
and
how muchprice
decreases, they per
supply
supply
constant-quality
Sources
will
will shift outward to the right.
are listed at the end ofunit.
decrease, and the this chapter.
supply curve will shift
inward to the left.
MyEconLab
How has a change in the number of firms in China’s automobile industry affected
Concept Check
the market supply of vehicles?
The Demand Schedule
xviii Let’s take a hypothetical demand situation to see how the inverse relationship be-
INTERNATIONAL EXAMPLE tween the price and the quantity demanded looks (holding other things equal). We
An Increase in the Supply of Automobiles in will consider the quantity of portable power banks—utilized with various digital
China
M32_MILL8777_19_SE_C32.indd 711 25/10/16 10:12 devices—demanded
AM per year. Without stating the time dimension, we could not
M03_MILL8777_19_SE_C03.indd make plants
In 2010, there51were fewer than 100 automobile-manufacturing senseinout given
of this demand
price than wasrelationship
the case in 2010.because
Thus, therethe
hasnumbers wouldin be differ-
been an increase 24/10/16 4:35 PM
China. Since then, a number of new vehicle-producing firms have we

ent if were talking
entered the supplyabout the quantity
of automobiles in China. demanded per month or the quantity
China’s auto market. The result has been an upsurge indemanded
the number of per decade.
plants, which currently exceeds 140. The larger number of autoInmanufac-
addition toFOR
implicitly
CRITICAL or explicitly
THINKING stating a time dimension for a demand rela-
turers operating in China now produce about 5 million moretionship,
vehicles atwe
anyare also implicitly
Has the referring
market supply curve in to constant-quality
China shifted rightwardunits of theExplain.
or leftward? good or service
in question. Prices are always expressed in constant-quality units in order to avoid the
problem of comparing commodities that are in fact not truly Concept
MyEconLab comparable.Check
In panel (a) of Figure 3-1, we see that if the price is $1 apiece, 50 portable
power banks will be bought each year by our representative individual, but if the
A01_MILL8760_19_SE_FM_Macro.indd 18 Changes in Supply
price versusonly
is $5 apiece, Changes in Quantity
10 portable power banks Supplied
will be bought each year. This 21/12/16 5:23 PM
ref lects the law of demand. Panel (a) is also called simply demand, or a demand
We cannot overstress the importance of distinguishing between a movement along the
industry have disappeared. Thus, U.S. app makers and Indian tablet manufacturers
are worse off.
Some people worry that the United States (or any country, for that matter) might
someday “run out of exports” because of overaggressive foreign competition. The CHAPTER 32 | Comparative Advantage and the Open Economy 725
analysis of comparative advantage tells us the contrary. No matter how much other
countries compete for our business, the United States (or any other32-6
FIGURE country) will
always have a comparative advantage in something that it can export. In 10The or 20
Percentage of World Trade within Regional Trade Blocs
years, that something may not be what we export today, but Asitthewill beofexportable
number
nonetheless because we will have a comparative advantage in producing
regional tradeit. Thus, the 40
agree-
Covered by Regional Agreements

significant f lows of world trade of exports and imports of bothments has increased
goods and services 35
since 1990, the share
Percentage of World Trade

shown in Figure 32-2 will continue because the United States and other
of world nations will 30
trade under-
retain comparative advantages in producing various goods and taken
services.
among nations
25
What new elements have enabled a growing number of Africanthatcountries
are membersto of develop
regional trade 20
comparative advantages in the provision of agricultural products?
blocs—involving the
15
European Union (EU),
the United States, 10
and developing
5
INTERNATION AL EXAMPLE nations—has also
increased. 0
How African Nations Are Developing Comparative Advantages in Agriculture Sources: World Bank
1990 1996 2002 2017
and author’s estimates. EU U.S. Developing countries only
INTERNATIONAL EXAMPLES AND

The African continent contains about half of the uncultivated but arable techniques. These developments have enabled African farmers to reduce
land in the world. It also contains many people who could, in principle, considerably the opportunity cost of agricultural products in terms of other
farm much of this land. Nevertheless, for many years, African countries
have imported most agricultural products.
goods and services. As the opportunity costs of African agricultural goods
have declined, new comparative advantages in producing these goods and INTERNATIONAL POLICY EXAMPLES
Regional Trade Agreements
During the past decade, a number of African nations have developed
comparative advantages in several varieties of corn and coffee. The conti-
gains from specialization and trade have followed.
Numerous other international trade organizations exist alongside the WTO.
emphasize the continued importance of
nent’s comparative-advantage turnaround has been assisted by adoption
of drought-resistant crop varieties. The key change, however, has been the
FOR CRITICAL THINKING
Why do you think that increased specialization groups
in specific
international perspectives
Sometimes known as regional trade blocs, these organizations are created by special
deals among of countries that grant trade preferences only to countries within
agricultural
Regional trade bloc
and
A group of nations that policy, such as:
grants members
their groups. Currently, special trade privileges.
widespread acquisition of additional physical and human capital. Afri- products has accompanied growth in African exports of those products?more than 475 bilateral or regional trade agreements are in
can farmers are using more machinery to plant and harvest their crops. • Looking for Hard-to-Find Items in Venezu-
effect around the globe. Examples include groups of industrial powerhouses, such as
Furthermore, they are acquiring training in how to apply modern farming Sources are listed at the end of this chapter. the European Union, the North American Free Trade Agreement, and the Association
of Southeast Asian Nations. Nations in South America with per capita real GDP ela? Ask for the Bachaqueros
nearer the world average have also formed regional trade blocs called Mercosur and
the Andean Community. In addition, less developed nations have formed regional
trade blocs, such as the Economic Community of West African States and the • How African Nations Are Developing
Community of East and Southern Africa.
Comparative Advantages in Agriculture
DO REGIONAL TRADE BLOCS SIMPLY DIVERT TRADE? Figure 32-6 shows that the formation of
regional trade blocs, in which the European Union and the United States are often
All of these are new to this edition and each has three references from
M32_MILL8777_19_SE_C32.indd 716
key participants, is on an upswing. An average African nation participates in four
25/10/16 A
separate regional trading agreements. 10:12 AM
typical Latin American country belongs to
which the information was obtained (these references can be found at the
eight different regional trade blocs.
In the past, economists worried that the formation of regional trade blocs could
mainly result in trade diversion, or the shifting of trade from countries outside a Trade diversion
back of each chapter). regional trade bloc to nations within a bloc. Indeed, a study by Jeffrey Frankel of
Harvard University found evidence that some trade diversion does take place.
Shifting existing international trade from
countries outside a regional trade bloc to
nations within the bloc.
Nevertheless, Frankel and other economists have concluded that the net effect of regional
trade agreements has been to boost overall international trade, in some cases considerably.
political process, but individually, we cannot determine how much service we pay for
WHAT I F… during any one year.
WHAT IF? FEATURES in each chapter aim to joining a new regional trade bloc shifts existing trade to countries within that bloc and away from
countries in another regional trade VERSUS SPENDING In the private market sector, a dollar voting system is in effect.
VOTINGbloc?
help students think critically about important This dollar voting system is not equivalent to the voting system in the public sector.
Theretrade
If joining a new regional trade bloc shifts existing are from
at least three
the old bloc differences:
bloc has failed to bring about an expansion of total world trade. Thus, the
real-world questions through the eyes of an to the new one, then formation of the new trade bloc has generated trade
1. In
diversion. The consequence is that formation a political
of the system,
new regional
aggregate amount of international trade will remain unaffected by forma-
trade onetion
person
of the gets one vote, whereas in the market system, each
new bloc.
dollar a person spends counts separately.
economist. All of these are new. Majority rule 2. The political system is run by majority rule, whereas the market system is run by
A collective decision-making system in proportional rule.
• What If…the government engages in policies which group decisions are made on the
basis of more than 50 percent of the vote. 3. The spending of dollars can indicate intensity of want, whereas because of the
that force down the price of an item subject In other words, whatever more than half of
the electorate votes for, the entire
all-or-nothing nature of political voting, a vote cannot.
to external benefits while leaving its supply electorate has to accept.

M32_MILL8777_19_SE_C32.indd 725
Proportional rule
Political outcomes often differ from economic outcomes. Remember that
economic efficiency is a situation in which, given the prevailing distribution of
25/10/16 10:12 AM
curve’s position unchanged? A decision-making system in which actions

are based on the proportion of the “votes”
income, consumers obtain the economic goods they want. There is no corresponding
situation when political voting determines economic outcomes. Thus, a political
cast and are in proportion to them. In a voting process is unlikely to lead to the same decisions that a dollar voting process
• What If… joining a new regional trade bloc market system, if 10 percent of the “dollar
votes” are cast for blue cars, 10 percent of
would yield in the marketplace.
Indeed, consider the dilemma every voter faces. Usually, a voter is not asked to
shifts existing trade to countries within that
automobile output will be blue cars.
decide on a single issue (although this happens). Rather, a voter is asked to choose
among candidates who present a large number of issues and state a position on each
bloc and away from countries in another SELF CHECK of them. Just consider the average U.S. senator, who has to vote on several thousand
different issues during a six-year term. When you vote for that senator, you are
Visit MyEconLab to practice
regional trade bloc? problems and to get instant
voting for a person who must make thousands of decisions during the next six years.
MyEconLab Concept Check
feedback in your Study Plan.
MyEconLab Study Plan
Y O U A R E T HE R E
YOU ARE THERE FEATURES demonstrate to Addressing Rail-Freight Transportation Externalities
students how real people in the real world react Noble Boykin, Jr., an attorney in Savannah, Georgia, is at his wit’s A growing number of U.S. communities are requiring rail firms to
end. Each day, about eight freight trains pass along a three-mile incur costs for the noise and delays they create. Some cities have
to changes in our economic environment and to stretch through the city near his law firm’s location. Locomotive
operators blast their horns at each of the 24 rail crossings along the
instructed their police forces to issue tickets assessing fines of
hundreds of dollars on rail firms each time their operations are
policy changes. All of these are new. route. If Boykin and other attorneys at the firms are in the midst of
recording depositions from clients or witnesses when trains pass,
judged to have created unjustifiable traffic delays. A few are even
requiring firms to erect walls beside portions of their track to pro-
• Addressing Rail-Freight Transportation they must halt for time-consuming “train breaks.” If a phone call
with a court official is in progress as a train approaches, Boykin has
vide sound buffers. In these ways, rail companies are being required
to take into account spillover effects of their activities in the market
a choice between apologetically postponing the call or quickly step- for freight transportation services.
Externalities ping into a closet. Boykin’s home also is located near the same
CRITICAL THINKING QUESTIONS
stretch of rails. Passing trains often delay his daily commutes, and
• Reducing the Opportunity Cost of Waiting in he sometimes is awakened during the night by the soundings of the
locomotives’ horns.
1. How does a city’s decision to assess substantial fines on rail
operators that persistently generate traffic congestion affect the
Gridlocked Traffic, at a Price The volume of items shipped by rail in the United States has risen
more than 10 percent since 2010. Trains contain more cars, and the
supply curve for rail services within the city?
2. Why do you think that the federal government requires rail opera-
greater weights pulled by locomotives also have slowed many trains tors to mount expensive horns and sound them—at prescribed
along their routes. Consequently, trains typically require more time to decibel levels—at all street crossings? (Hint: What significant
traverse distances than in past years. In many locales, the results negative spillovers can a train create at a street crossing?)
have been longer periods of noisy train operations and related traffic
delays for people such as Boykin. Sources are listed at the end of this chapter.
M05_MILL8777_19_SE_C05.indd 116 24/10/16 5:00 PM
MYECONLAB: PRACTICE, ENGAGE, AND ASSESS

MyEconLab is a powerful assessment and tutorial system that works hand-in-hand with Economics
Today. MyEconLab includes comprehensive homework, quiz, test, and tutorial options, allowing instructors to
manage all assessment needs in one program.
For the Instructor

• Instructors can select a prebuilt course option, which creates a ready-to-go course with homework and quizzes
already set up. Instructors can also choose to create their own assignments and add them to the preloaded
course. Or, instructors can start from a blank course.
xix

• All end-of-chapter problems are assignable and automatically graded in MyEconLab and, for most chapters,
additional algorithmic, draw-graph, and numerical exercises are available to choose among.
• Instructors can also choose questions from the Test Bank and use the Custom Exercise Builder to create their
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exercises covering fundamental math concepts geared for economics students. Aimed at increasing student
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• Real-Time Data Analysis Exercises are marked with and allow instructors to assign problems that use
up-to-the-minute data. Each RTDA exercise loads the appropriate and most currently available data from
FRED®, a comprehensive and up-to-date data set maintained by the Federal Reserve Bank of St. Louis. Exer-
cises are graded based on that instance of data, and feedback is provided.
• In the eText available in MyEconLab, select figures labeled Real-Time Data now include a pop-up graph up-
dated with real-time data from FRED®.
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issues has never been more convenient.
• Experiments in MyEconLab are a fun and engaging way to promote active learning and mastery of important
economic concepts. Pearson’s experiments program is flexible and easy for instructors and students to use.
–– Single-player experiments allow your students to play an experiment against virtual players from anywhere
at any time with an Internet connection.
–– Multiplayer experiments allow you to assign and manage a real-time experiment with your class.
In both cases, pre- and post-questions for each experiment are available for assignment in MyEconLab.
Digital Interactives help to facilitate experiential

learning through a set of interactives focused on core
economic concepts. Fueled by data, decision-making,
and personal relevance, each interactive progresses
through a series of levels that build on foundational
concepts, enabling a new immersive learning experi-
ence. The flexible and modular set-up of each interac-
tive makes digital interactives suitable for classroom
presentation, auto-graded homework, or both.
Learning Catalytics™ is a technology that has grown

out of twenty years of cutting-edge research, innova-
tion, and implementation of interactive teaching and
peer instruction. Learning Catalytics is a “bring your
own device” student engagement and classroom intel-
ligence system. With Learning Catalytics you can:
• Engage students in real time, using open-ended
tasks to probe student understanding.
–– Students use any modern Web-enabled device
they already have — laptop, smartphone, or tablet.
–– Eighteen different question types include: word
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–– Address misconceptions before students leave the classroom.
–– Understand immediately where students are and adjust your lecture accordingly.
xx

• Improve your students’ critical-thinking skills.
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• Learning Catalytics gives you the flexibility to create your
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library of Pearson-created questions.
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Dynamic Study Modules: Dynamic Study Modules continuously
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Study Modules exist for every chapter to provide additional
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For the Student

Students are in control of their own learning through a collec-
tion of tests, practice, and study tools. Highlights include:
• Two Sample Tests per chapter are preloaded in MyEconLab,
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SUPPLEM ENTAL R ESO UR CES
Student and instructor materials provide tools for success.

Test Bank (Parts 1, 2, and 3) offer more than 10,000 multiple-choice and short answer questions,
all of which are available in computerized format in the TestGen software. The significant revision
process by author Jim Lee of Texas A&M University–Corpus Christi and accuracy reviewer Conor
Molloy of Suffolk County Community College ensure the accuracy of problems and solutions in these
revised and updated Test Banks. The Test Bank author has connected the questions to the general
knowledge and skill guidelines found in the Association to Advance Collegiate Schools of Business
(AACSB) assurance of learning standards.
The Instructor’s Manual, prepared by Jim Lee of Texas A&M University–Corpus Christi, includes lecture-
ready examples; chapter overviews; objectives; outlines; points to emphasize; answers to all critical
analysis questions; answers to all end-of-chapter problems; suggested answers to “You Are There”
questions; and selected references.
PowerPoint lecture presentations for each chapter, revised by Jim Lee of Texas A&M University—Corpus
Christi, include figures, key terms, and concepts from the text.
Clicker PowerPoint slides allow professors to instantly quiz students in class and receive immediate
feedback through Clicker Response System technology.
The Instructor Resource Center puts supplements right at instructors’ fingertips. Visit
www.pearsonhighered.com/irc to register.
Economics Today, 19th edition, is available as an eBook and can be purchased at most eBook retailers.
xxi

Another random document with
no related content on Scribd:
de toute Engleterre, de sens, de force, d’eur, de
fortune, de haute emprise et de bon conseil; et par
25 especial li rois avoit son fil le prince recommendé à
lui et en sa garde. Là estoient li sires de Bercler,
messires James d’Audelée et messires Pières ses frères,
messires Bietremieus de Brues, li sires de le Ware,
messires Thumas et messires Guillaumes de Felleton,
30 li sires de Basset, messires Estievenes de Gonsenton,
[136] messires Edowars, sires Despensiers, li sires de Willebi,
messires Ustasses d’Aubrecicourt et messires
Jehans de Ghistelles, et pluiseur aultre que je ne puis
mies tous nommer.
5 Si me tairai dou prince et de ses gens, et ossi dou
duch de Lancastre qui ariva en Bretagne, et parlerai
dou roy d’Engleterre et de sen armée qui en ce temps
volt venir en Normendie sus la terre dou roy de
Navare.
10 § 346. Quant li rois d’Engleterre eut fait toutes

ses pourveances, il monta en mer ou havene de
Hantonne à tout deus mil hommes d’armes et quatre
mil arciers. Si estoient en se compagnie li contes
d’Arondiel, li contes de Norhantonne, li contes de
15 Herfort, li contes de Stafort, li contes de le Marce, li
contes de Hostidonne, li contes de Cornuaille, li
evesques de Lincolle et li evesques de Wincestre,
messires Jehans de Biaucamp, messires Rogiers de
Biaucamp, messires Gautiers de Mauni, li sires de
20 Manne, li sires de Montbray, li sires de Ros, li sires
de Persi, li sires de Nuefville, messires Jehans de
Montagut,
li sires de Grastoch, li sires de Clifort, messires
Symons de Burlé, messires Richars de Pennebruge,
messires Alains de Bouqueselle, et pluiseurs
25 aultres barons et chevaliers desquels je ne puis mies
de tous faire mention. Si s’adrecièrent li rois, ces
gens d’armes et ceste armée, devers Normendie pour
prendre terre à Chierebourch, où li rois de Navare
les attendoit.
30 Quant il furent entré en mer et il eurent singlé un
jour, il eurent vent contraire, et les couvint retourner
[137] en l’isle de Wiske, et là furent quinze jours. Et
quant il s’en partirent, il ne se peurent adrecier vers
Chierebourc, tant leur estoit li vens contraires; mais
prisent terre en l’isle de Grenesée, à l’encontrée de
5 Normendie, et là furent un grant temps, car il ooient
souvent nouvelles dou roy de Navare, qui se tenoit
à Chierebourch.
Bien estoit li rois de France enfourmés de ces armées
que li rois d’Engleterre en celle saison avoit
10 mis sus, et comment il tiroit à venir et ariver en
Normendie, et que li rois de Navare s’estoit alliiés à
lui, et le voloit et ses gens mettre en ses forterèces.
Si en fu dit et remoustret au roy de France, par
grant deliberation de conseil, que ceste guerre de
15 Normendie li pooit trop grever, ou cas que li rois de
Navare possessoit des villes et des chastiaus de le
conté d’Evrues, et que mieuls valoit que il se dissimulast
un petit et laissast à dire devers le roy de
Navare que donc que ses royaumes fust si malement
20 menés ne grevés.
Li rois de France, qui estoit de grant conception
hors de son aïr, regarda que ses consauls le consilloit
loyaument; si se rafrena de son mautalent et laissa
bonnes gens ensonniier et couvenir de lui et dou roy
25 de Navare. Si furent envoiiet à Chierebourch li evesques
de Bayeus et li contes de Salebruce, qui parlèrent
si doucement et si bellement au roy de Navare,
et li remoustrèrent tant de belles raisons coulourées,
que li dis rois se laissa à dire et entendi à raison,
30 parmi tant ossi qu’il desiroit le pais à son grant signeur
le roy Jehan de France. Mais ce ne fu mies si
tost fait; ançois y eut moult de parolles retournées
[138] ançois que [la] pais venist et que li rois de Navare volsist
renoncier as trettiés et as alliances qu’il avoit au
roy d’Engleterre. Et quant la pais entre lui et le roy
de France fu acordée et seelée, et qu’il renonça en
5 lui escusant moult sagement as alliances qu’il avoit
au roy d’Engleterre, si demora messires Phelippes de
Navare ses frères englès, et sceut trop mauvais gré au
roy son frère de ce qu’il avoit travilliet le roy
d’Engleterre de venir si avant, et puis avoit brisiet toutes
10 ses couvenences.
§ 347. Quant li rois d’Engleterre, qui se tenoit

sus les frontières de Normendie en l’isle de Grenesée
et estoit tenus bien sept sepmainnes, car là en dedens
il n’avoit oy nulles nouvelles estables dou roy
15 de Navare pour quoi il euist eu cause de traire avant,
entendi que li rois de Navare estoit acordés au roy
de France et que bonne pais estoit jurée entre yaus,
si fu durement courouciés; mès amender ne le peut
tant qu’à celle fois, et li couvint souffrir et porter les
20 dangiers son cousin le roy de Navare. Si eut volenté
de desancrer de là et de retourner en Engleterre,
ensi qu’il fist, et s’en revint o toute sa navie à Hantonne.
Si issirent là des vaissiaus et prisent terre li
rois et leurs gens, pour yaus rafreschir tant seulement,
25 car il avoient estet bien douze sepmainnes sus le mer,
dont il estoient tout travilliet. Si donna li rois
d’Engleterre grasce à ses gens d’armes et arciers de
retraire
vers Londres ou en Engleterre, là où le mieulz leur
plaisoit, pour yaus rafreschir et renouveler de vesteure,
30 d’armeures et de tous aultres ostilz neccessaires
pour leurs corps, car aultrement il ne donna
[139] nullui congiet, ançois avoit entention d’entrer en
France au lés devers Calais. Et fist li dis rois venir et
amener toute sa navie, où bien avoit trois cens vaissiaus,
uns c’autres, à Douvres et là arester.
5 Quant li rois d’Engleterre et li signeur se furent
rafreschi environ quinze jours sus le pays, il se traisent
tout en le marce de Douvres; si fisent passer
tout premierement leurs chevaux, leur harnois et
leur menues coses, et venir à Calais. Et puis passèrent
10 li rois et si doi fil, Lyons contes de Dulnestre et
Jehans contes de Ricemont, et se commençoient jà li
enfant à armer. Si vinrent à Calais, et se loga li rois
et si enfant ens ou chastiel, et tous li demorans en le
ville.
15 Quant li rois d’Engleterre eut sejourné en le ville
de Calais un petit de terme, si eut volenté de partir et
de chevaucier en France. Si fist connestable de
toute son host le conte de Sallebrin, et mareschaus
le signeur de Persi et le signeur de Nuefville. Si se
20 departirent de Calais moult ordonneement en grant
arroy, banières desploiies, et chevaucièrent vers
Saint Omer. Et passèrent devant Arde et puis devant
le Montoire, et se logièrent sus le rivière
d’Oske. Et à lendemain li marescal de l’host le roy
25 coururent devant Saint Omer, dont messires Loeis
de Namur estoit chapitains. Si vinrent jusques as
barrières, mès il n’i fisent aultre cose.
Li rois de France, qui bien avoit entendu que li
rois d’Engleterre toute celle saison avoit fait ses
30 pourveances grandes et grosses, et qu’il s’estoit tenus
sus mer, supposoit bien que li rois dessus nommés,
quoique les alliances de lui et dou roy de Navarre
[140] fussent brisies, ne se tenroit point à tant que
il n’emploiast ses gens où que fust. Et quant il sceut
que il estoit o toute son host arrivés à Calais, si envoia
tantost grans gens d’armes par toutes les forterèces
5 de Pikardie en le conté d’Artois. Et fist un
très grant et especial mandement par tout son
royaume que tout chevalier et escuier, entre l’eage
de quinze ans et de soissante, fuissent à un certain
jour que il y assist, en le cité d’Amiens ou là environ,
10 car il voloit aler contre les Englès et yaus combatre.
En ce temps estoit connestables de France li dus
d’Athènes, et mareschal messires Ernoulz d’Audrehen
et messires Jehans de Clermont.
Si envoia encores li dis rois de France devers ses
15 bons amis en l’Empire, et par especial monsigneur
Jehan de Haynau en qui moult se confioit de sens,
de proèce et de bon conseil. Li gentilz chevaliers ne
volt mies fallir à ce grant besoing le roy de France,
mès vint vers lui moult estoffeement, ensi que bien
20 le savoit faire, et le trouva en le cité d’Amiens.
Là estoient dalés le roy de France si quatre enfant:
premierement Charles l’ainnet, duch de Normendie
et dalphin de Viane, messires Loys, li secons
apriès, contes d’Ango et du Mainne, li tiers
25 messires Jehans contes de Poitiers, et li quars messires
Phelippes. Et quoique cil quatre signeur et enfant
fuissent avoech le roy leur père, il estoient
pour ce temps encores moult jone; mais li rois les y
menoit pour aprendre les armes. Là estoit li rois
30 Charles de Navarre, li dus d’Orliens frères dou roy
Jehan, li dus de Bourbon, messires Jakemes de Bourbon
contes de Poitiers ses frères, li contes de Forès,
[141] messires Jehans de Boulongne contes d’Auvergne, li
contes de Tankarville, li contes d’Eu, messires Charles
d’Artois ses frères, li contes de Dammartin, li contes
de Saint Pol, et tant de contes et de barons que grans
5 tanisons seroit à recorder.
Si eut li rois en le cité d’Amiens bien douze mil
hommes d’armes, sans les communautés dont il avoit
bien trente mil. Et quoique li dis rois de France
fesist son amas de gens d’armes et ses pourveances
10 si grandes et si grosses pour chevaucier contre les
Englès, pour ce ne sejournoit mies li rois d’Engleterre
d’aler toutdis avant ou royaume de France,
car nulz ne li aloit au devant; et chevauçoit vers
Hedin, dont il avoient si grant paour en le cité d’Arras,
15 que merveilles seroit à penser, car il cuidoient
que li rois d’Engleterre deuist mettre le siège devant
leur ville et leur cité.
Or vous lairons nous un petit à parler dou roy
d’Engleterre et dou roy de France, et vous parlerons
20 de une haute emprise et grande que messires Guillaumes
Douglas et li Escot fisent en Engleterre, entrues
que li rois Edowars estoit en ce voiage de
France.
§ 348. Messires Guillaumes de Douglas, cils bons

25 chevaliers d’Escoce, guerrioit toutdis à son pooir les
Englès, quoique li rois David d’Escoce fust prisonniers,
ensi que vous savés; et estoit chiés de tous les
Escos, leur confors et leur ralloiance, et se tenoit en
le forest de Gedours. Si avoit avoecques lui pluiseurs
30 chevaliers et escuiers d’Escoce et de France que li
rois Jehans y avoit envoiiés, liquel faisoient guerre
[142] avoecques lui as Englès. Et comment qu’il ne fuissent
c’un petit de gens, se donnoient il à faire moult
les Englès, et les ressongnoient durement cil dou
pays de Northombrelande. Cils messires Guillaumes
5 de Douglas, par proèce et par vasselage, depuis le
prise dou roy d’Escosse, avoit reconquis sus les Englès
sept bonnes forterèces qu’il tenoient des Escos,
et avoit mis chiaus de son pays assés au dessus de
leur guerre.
10 Or entendi il ensi que li royaumes d’Engleterre
estoit durement eswidiés de gens d’armes et d’arciers,
et que il estoient tout ou en partie avoecques le
roy d’Engleterre ou son fil prince de Galles, ou le
duch Henri de Lancastre. Si s’avisa li dessus dis messires
15 Guillaumes avoecques ses compagnons que il
feroient secretement une chevaucie en Engleterre et
venroient eschieller le fort chastiel de Rosebourch
qui siet sus le rivière de Tuide, et le ville et le
chastiel de Bervich seant sus celle meisme rivière.
20 Si fisent leur besongne et leur ordenance tout quoiement;
et s’en vinrent, pourveu d’eschielles et aviset
de leur fait, à un ajournement en deus batailles à
Rosebourch et à Bervich. Les gardes de Rosebourch,
qui estoient toutdis en doubte et en cremeur pour
25 les Escos, faisoient bon gait; et fallirent li Escot à
leur entente de prendre et eschieller Rosebourch.
Mais cil qui vinrent à Bervich ne fallirent mies; ançois
assenèrent de prendre et eschieller le chastiel et
tuèrent toutes les gardes qui dedens estoient.
30 Li chastiaus de Bervich siet au dehors de le cité,
et y a murs, portes et fossés entre deus. Et toutdis,
quoique on garde le chastiel de Bervich, ossi est
[143] on moult songneus de garder le cité. Si oïrent les
gardes de le porte l’effroy qui estoit ens ou chastiel;
si sallirent tantost sus et alèrent rompre les plances,
par quoi li Escot soubdainnement ne peuissent venir
5 plus avant. Et esvillièrent ceulz de le ville qui tantost
s’armèrent et alèrent celle part et deffendirent
leur ville. Jamais li Escot ne l’euissent eu, puisqu’il
en estoient mancevi. Toutes fois li chastiaus demora
as Escos.
10 Si eurent avis li bourgois de Bervich qu’il le segnefieroient
au roy d’Engleterre, car encores li sires de
Grastoch, uns grans barons de Northombrelande,
qui avoit tout ce pays en gouvrenance, estoit avoecques
le roy d’Engleterre en ce voiage en France. Si
15 escripsirent cil de Bervich lettres, et segnefiièrent ens
tout leur estat, et comment li Escot avoient esploitié,
desquelz messires Guillaumes Douglas estoit menères
et souverains. Ançois que ces lettres et ces nouvelles
venissent au roy d’Engleterre, fist li dis messires
20 Guillaumes une partie de son emprise, si com vous
orés compter ensiewant.
§ 349. Tant ala li rois d’Engleterre que il vint devant

Blangis, un biau chastiel et fort de la conté
d’Artois, et estoit pour le temps au jone duch de
25 Bourgongne. Si s’arresta li rois d’Engleterre par devant,
dont cil de Hedin furent tout esbahi, car c’est
marcissant à deus petites liewes priès. Et couroient
li Englès le pays à leur volenté jusques bien avant en
le conté de Saint Pol et d’Artois.
30 Entrues que li rois d’Engleterre se tenoit là, vint
en son host uns moult bons chevaliers de France des
[144] basses marces qui s’appelloit Bouchicaus, et estoit
prisonniers au roy d’Engleterre de le prise de Poito,
et avoit bien esté trois ans. Se li avoit li rois d’Engleterre
fait grasce d’estre retournés en France et en
5 son pays pour mettre ses besongnes à point; si devoit
dedens le jour Saint Michiel restre en le prison
dou roy dessus dit. Cilz messires Boucicaus estoit uns
vaillans homs, grans chevaliers et fors, et durement
bons compains, et bien en le grasce et amour dou
10 roy d’Engleterre et des Englès, tout par sens et par
biau langage qu’il avoit bien apparilliet. Si trouva
sus les camps d’aventure, entre Saint Pol et Hedin,
les mareschaus dou roy d’Engleterre qui tantost [le[293]]
recogneurent et qui li fisent grant cière, car il savoient
15 bien qu’il estoit prisonniers; se leur demanda
dou roy où il estoit. Il li respondirent qu’il l’i [menroient[294]]
tout droit, car ossi aloient il celle part. Si se
mist li dis messires Bouchicaus en leur compagnie;
et fisent tant qu’il vinrent devant Blangis où li rois
20 estoit logiés.
Messires Boucicaus se trest tantost devers le roy,
que il trouva devant son pavillon, et regardoit une
luitte de deus Bretons.
Messires Boucicaus se traist vers le roy, et l’enclina
25 tout bas, et le salua. Li rois, qui desiroit à oïr nouvelles
de son adversaire le roy Jehan, dist ensi: «A
bien viègne Boucicaus!» Et puis li demanda: «Et
dont venés vous, messire Boucicau?»—«Monsigneur,
respondi li chevaliers, je vieng de France et
[145] tout droit de le cité d’Amiens, où j’ay là laissiet le roy
monsigneur et grant fuison de noble chevalerie: dont
je espoir que vous orés temprement nouvelles.»
Li rois d’Engleterre pensa un petit, et puis dist:
5 «Messire Boucicau, qu’es cou à dire, quant mon adversaire
scet que je sui logiés en son pays, et ay jà
esté par trois jours à siège devant uns de ses chastiaus,
et si a tant de chevaliers que vous dittes, et si
ne me vient point combatre?» Messires Bouchicaus
10 respondi moult aviseement, et dist: «Monsigneur, de
tout che ne sai je riens, car je ne suis mies de son
secret conseil; mès je me vieng remettre en vostre
prison pour moy acquitter envers vous.»
Adonc dist li rois une moult belle parolle pour le
15 chevalier: «Messire Boucicau, je sçai bien que, se je
vous voloie plenté presser, j’aroie bien de vous deus
ou trois mil florins; mais je vous dirai que vous
ferés: vous en irés à Amiens devers mon adversaire,
et li dirés où je sui, et que je l’i ay attendu trois
20 jours, encores l’i attenderai je cinq, et que là en dedens
il traie avant; il me trouvera tout prest pour
combatre. Et parmi tant que vous ferés ce message,
je vous quitte vostre prison.» Messires Boucicaus fu
tous resjoïs de ces nouvelles et dist: «Monsigneur,
25 vostre message ferai je sans fallir bien et à point; et
vous me faites grant courtoisie: Diex le vous puist
merir!»
Assés tost apriès ces parolles, fu il heure de souper.
Si soupa li rois et si chevalier et messires Boucicaus
30 avoec yaus. Quant ce vint au matin, messires
Boucicaus monta à cheval et se mesnie, et se mist au
retour au plus droit qu’il peut devers Amiens, et fist
[146] tant qu’il y parvint. Si trouva là le roy de France et
grant fuison de dus, de contes, de barons et de chevaliers.
Si fu li bien venus entre yaus; et eurent grant
merveille de ce qu’il estoit si tost retournés: si leur
5 conta sen aventure. Et fist au roy tout premierement
son message, ensi que li rois d’Engeterre li mandoit;
et li dist, presens grant fuison de haus signeurs. Et
puis dist messires Bouchicaus tout en riant: «Li
lewiers de ce message est telz que li rois d’Engleterre
10 m’a quitté ma prison, qui me vient trop bien à
point.» Li rois de France respondi: «Bouchicau,
vous avés pris pour vous, et nous y entenderons
pour nous, quant bon nous samblera, non à l’aise
ne ordenance de nos ennemis.»
15 § 350. Ensi demora la cose en cel estat, et li rois

de France encores à Amiens; ne point ne se meut si
tretos pour le mandement dou roy d’Engleterre, car
toutdis li venoient gens et encores en attendoit il.
Quant li rois d’Engleterre, puis le departement de
20 monsigneur Boucicau, vei que li rois Jehans ne trairoit
point avant, et que li jour estoient passet que
ordonné il y avoit, il eut conseil de deslogier et de
lui retraire vers Calais, car pour celle saison il en
avoit assés fait. Si se desloga li dis rois, et se
25 deslogièrent toutes ses gens, et puis se misent au chemin
toute l’Alekine, un biau plain chemin que on dist
Leueline[295], qui s’en va tout droit devers Calais; si
passèrent parmi la conté de Faukemberghe.
Quant li rois de France, qui se tenoit à Amiens,
[147] sceut que li rois d’Engleterre s’en retournoit vers
Calais, o primes se desloga il; et fu tous courouciés
sur chiaus qui l’avoient là tant tenu, car on l’avoit
enfourmé que li rois d’Engleterre venroit mettre le
5 siège devant Arras, et là le voloit il trouver et combatre.
Si se hasta li dis rois durement et s’en vint
jesir ce premier jour à Saint Paul à Tierenois, et l’endemain
à Tieruane. Et li Englès estoient oultre à
Faukemberge, et l’avoient toute robée et pillie.
10 A l’endemain s’en parti li rois d’Engleterre et toute
son host, et passèrent à Liques et desous Arde, et
rentrèrent ce jour en le ville de Calais. Messires Ernoulz
d’Audrehen, qui alant et venant avoit toutdis
costiiet les Englès, et tenus si cours, que li arrieregarde
15 ne s’estoit onques oset dessouchier, poursievi
les Englès de si priès que, au rentrer en Calais, il se
feri en le kewe et parti à leur butin, et eut de leurs
chevaus et de leur pillage et bien dix ou douze prisonniers;
et puis s’en retourna en le bastide d’Arde,
20 dont il estoit chapitains.
Ce propre jour vint li rois de France jesir à Faukemberghe,
et toute son host là environ, où bien avoit plus
de cent mil hommes. Si se tinrent là li François celle
nuit. Et l’endemain au matin vint li mareschaus de
25 France, messires Ernoulz d’Audrehen, qui aporta
nouvelles au roy que li Englès estoit retrait en le
ville de Calais. Quant li rois de France entendi ces
nouvelles, si demanda conseil quel cose il feroit. On
li dist que de chevaucier plus avant contre les Englès
30 il perderoit se painne, mès se retraisist vers
Saint Omer et là aroit nouvel avis.
A ceste ordenance s’acorda li rois, et se retrest
[148] vers Saint Omer et toutes ses gens ossi. Et se loga li
dis rois en l’abbeye de Saint Bertin, qui est abbeye
royaus. Là manda li rois tous les barons et les plus
especiaulz de son conseil à savoir comment de ceste
5 chevaucie il poroit issir à son honneur, car il estoit
enfourmés que li rois d’Engleterre estoit encores arrestés
à Calais. Si fu adonc li rois consilliés qu’il envoiast
monsigneur Ernoul d’Audrehen et monsigneur
Bouchicau devers le roy d’Angleterre, lesquelz
10 deus chevaliers il cognissoit assés bien, et li
demandassent
bataille de cent à cent, ou de mil à mil, ou
de pooir à pooir, «et que vous li liverés place et
pièce de terre par l’avis de six de vos chevaliers et
de six des siens.»
15 Li rois tint ce consseil à bon; et montèrent li doi
chevalier, et se departirent de Saint Omer, et chevaucièrent
vers Calais. Et envoiièrent devant un hiraut
pour empetrer un saufconduit, pour aler parler
au roy d’Engleterre. Li hiraus s’esploita tant que le
20 saufconduit il leur raporta à Arde, dont chevaucièrent
li dessus dit chevalier oultre, et vinrent jusques
à Calais.
En ce propre jour au matin estoit arrivés ou havene
de Calais cilz qui aportoit les nouvelles de Bervich,
25 comment li Escot avoient pris le chastiel de
Bervich et volut eschieller Rosebourch. Si en estoit
encores li rois tous pensieus et merancolieus, et en
avoit parlé ireusement au signeur de Grastoch, qui la
terre de Bervich, le cité et le dit chastiel avoit en
30 garde, quant il s’en estoit partis, telement que il n’i
avoit mis si bonnes gardes que nulz damages ne l’en
fust pris, et de ce l’avoit il grandement blasmé. Mais
[149] li sires de Grastoch s’estoit à son pooir escusés, en
disant qu’il y avoit laissiet gens assés, mais qu’il en
euissent bien songniet. Si avoit li rois ordenet de retourner
en Engleterre et dit ensi que lui venut à Douvres,
5 il ne giroit jamais en une ville que une nuit, si
aroit esté à Bervich et atourné tel le pays que on diroit:
«Ci sist Escoce.»
Non obstant ce et l’ordenance que il avoit mis de
retourner en Engleterre, quant il sceut que li chevalier
10 de son aversaire le roy Jehan voloient parlementer
à lui, il cessa de sen ordenance tant que il les
euist oys, et les fist venir avant devant li. Et ne leur
fist nul samblant, en langage ne aultrement, que il
15 vosist partir si soudainnement ne retourner en
Engleterre.
§ 351. Quant messires Ernoulz d’Audrehen et messires

Boucicaus furent venu devant le roy, il l’enclinèrent
et saluèrent bien et à point, ensi que il le
sceurent bien faire et c’à lui apartenoit. Et puis li
20 remoustrèrent pourquoi il estoient là venu en requerant
la bataille, ensi que ci dessus est contenu et qu’il
estoient chargiet dou dire. Li rois d’Engleterre respondi
à ce briefment, en regardant sus monsigneur
Boucicau et leur dist: «Dou temps que j’ay chevaucié
25 en France et logiet devant Blangis bien dix jours, je
li mandai, ensi que vous savés, que je ne desiroie
aultre cose que la bataille. Or me sont venu aultres
nouvelles pourquoi je ne me combaterai mies à
l’ordenance de mes anemis, mès à le volenté de mes
30 amis.»
Ce fu la response finable que il en peurent dou
[150] roy avoir et porter. Si prisent congiet et se partirent
de Calais et retournèrent arrière à Saint Omer; et
recordèrent au roy de France et à son conseil la response,
tout ensi que il l’avoient entendu et retenu
5 dou roy d’Engleterre. Si eurent li François sur ce
avis, et veirent bien que pour celle saison il ne se
combateroient point as Englès. Si donna li rois de
France toutes manières de gens d’armes congiet, et
de communaultés ossi; si s’en retournèrent cescuns
10 en leurs lieus. Ilz meismes s’en retourna en France,
mais à son departement il laissa ens ès garnisons de
Pikardie grant fuison de bonnes gens d’armes. Et demora
messires Ernoulz d’Audrehen en le bastide
d’Arde, pour garder les frontières.
15 Si retourna messires Jehans de Haynau arrière en
le conté de Haynau, quant il eut pris congiet au roy
de France. Ce fu la darrainne chevaucie où li gentilz
chevaliers fu, car le quaresme ensievant, droitement
le nuit Saint Grigore, il trespassa de ce siècle en
20 l’ostel de Byaumont en Haynau; et fu ensepelis en
l’eglise des Cordeliers en le ville de Valenchiènes: là
gist il moult reveramment. Si furent hiretier de toute
sa terre li enfant le conte de Blois qui demora à
Creci, car il estoient enfant de sa fille: ce furent
25 Loeis, Jehans et Guis.
§ 352. Nous parlerons dou roy d’Engleterre qui

n’avoit mies mis en oubli le voiage d’Escoce, et
compterons comment il persevera. Il se departi
adonc de Calais à tout ses gens d’armes et arciers, et
30 entra en ses vaissiaus, et prist le chemin de Douvres.
A son departement, il institua le conte de Sallebrin
[151] à cent hommes d’armes et deus cens arciers, à demorer
en le ville de Calais, pour garder le ville contre
les François qu’il sentoit encores à Saint Omer.
Quant li rois d’Engleterre et ses gens furent arrivet à
5 Douvres, il issirent des vaissiaus et s’i tinrent ce jour
et le nuit ensievant, pour ravoir leurs chevaus et
leurs harnas hors des nefs. Et à l’endemain li dis
rois se parti et vint à Cantorbie, et fist là sen offrande
au corps saint Thumas. Et disna en le ville, et puis
10 passa oultre, et toutes ses gens ossi; et ne prist
mies le chemin de Londres, mès les adrèces pour
venir jusques à Bervich.
Or vous dirai d’une haute emprise et grande que
messires Gautiers de Mauni, cilz vaillans et gentilz
15 chevaliers, fist en ce voiage. Il prist congiet dou roy
et dist qu’il voloit chevaucier devant pour ouvrir les
chemins. Li rois li ottria assés legierement. Si chevauça
li dis messires Gautiers o chiaus de sa carge
tant, par nuit et par jour, qu’il vint devant Bervich
20 et entra en le ville, quant il eut passet le rivière de
Tuyde qui keurt devant. Et fu grandement conjoïs
de chiaus de Bervich et liement recueilliés. Si demanda
à chiaus qui là estoient dou couvenant des
Escos et de chiaus dou chastiel. On li dist que li Escot
25 tenoient le chastiel, mès il n’estoient point fuison de
gens dedens. «Et qui est leur chapitains?» dist messires
Gautiers de Mauni. «Il l’est, respondirent chil,
uns chevaliers escos, cousins au conte de Douglas,
qui s’appelle messires Guillaumes Asneton.»—«En
30 non Dieu, dist messires Gautiers, je le cognois
bien: c’est uns bons homs d’armes. Je voeil qu’il
sente, et ossi tout si compagnon, que je sui ci
[152] venus devant pour prendre les logeis dou roy
d’Engleterre.»
Adonc messires Gautiers de Mauni mist ouvriers
en oevre, et avoit usage que il menoit toutdis quarante
5 ou cinquante mineurs: si ques ces mineurs il
les fist entrer en mine à l’endroit dou chastiel. Cil
mineur n’eurent gaires minet quant, par dessous les
murs, ils trouvèrent uns biaus degrés de pière qui
avaloient aval et puis remontoient contremont par
10 desous les murs de le ville et aloient droitement ou
chastiel. Et euissent li Escot sans faute esté pris par
celle mine, quant il se perçurent que on les minoit.
Et furent segnefiiet ossi que li rois d’Engleterre o
tout son effort venoit. Si eurent conseil entre yaus
15 qu’il n’attenderoient mies ces deus perilz, l’aventure
de le mine et le venue dou roy d’Engleterre. Si toursèrent
tout ce que il avoient de bon une nuit, et
montèrent sus leurs chevaus, et se partirent dou
chastiel de Bervich et le laissièrent tout vaghe. Et
20 volentiers l’euissent ars au partir, et s’en misent en
painne, mais li feus ne s’i volt onques prendre. Ensi
reconquist messires Gautiers de Mauni le chastiel de
Bervich ançois que li rois ses sires i peuist venir et
l’en fist present des clés. Et li raconta sus les camps,
25 en venant celle part, comment il l’avoit reconquis
et l’aventure de le bonne mine qu’il avoit trouvé. Si
l’en seut li rois d’Engleterre grant gré, et le tint
pour grant vasselage. Si entra en le ville de Bervich
à grant ordenance de menestraudies. Si le recueillièrent
30 moult honnourablement li bourgois de le
ville.
[153] § 353. Apriès le reconquès de Bervich, si com

vous avés oy, et que li rois et ses gens se furent rafresci
en le cité et en le marce cinq jours, li dis rois
ordonna d’aler plus avant ou pays et dist que, ains
5 son retour, il arderoit tout le plain pays d’Escoce et
abateroit toutes les forterèces. Et pour ce mieus
esploitier, il avoit fait cargier sus le rivière de Hombre,
en grosses nefs, grant fuison d’engiens et d’espringalles
pour ariver en le mer d’Escoce, desous Haindebourch,
10 et tout premierement abatre le fort chastiel
d’Aindebourch. Et disoit li rois que il atourneroit
tèle Escoce qu’il n’i lairoit chastiel ne forte maison
en estant. Avoech tout ce, pour ce que li rois
d’Engleterre savoit bien que il ne trouveroient mies
15 pourveances à leur aise ens ou royaume d’Escoce,
car c’est pour gens d’armes aforains uns moult povres
pays, et que li Escot avoient tout retret ens ès
forès inhabitables, li dis rois avoit fait cargier bien
quatre vingt nefs de blés, de farines, de vins, de
20 chars, d’avaines et de chervoises, pour soustenir
l’ost, car il estoit jà moult avant en l’ivier.
Si se departirent li rois d’Engleterre et ses gens,
et chevaucièrent avant ou pays en approçant
Haindebourch.
Et ensi que il aloient, li mareschal de
25 l’host et leurs banières couroient, mais il ne trouvoient
riens que fourer. Si chevaucièrent tant li rois
et ses gens qu’il vinrent en Haindebourch et se logièrent
à leur volenté en le ville, car elle n’est point
fremée. Si se loga li rois en l’ostel de le monnoie,
30 qui estoit grans et biaus. Et demanda li rois se c’estoit
li hostelz dou bourgois d’Aindebourch qui avoit
dit qu’il seroit maires de Londres; on li dist: «oil.»
[154] Si en eut li rois bons ris, et dist là à ses chevaliers le
conte, ensi qu’il aloit.
«Quant li rois David d’Escoce entra en nostre
pays de Northombrelande, et il vint devant le Noef
5 Chastiel sur Thin, le temps que nous estions devant
Calais, il avoit avoecques li un homme qui estoit
sires de cel hostel; si disoit, et ossi disoient pluiseur
Escot, que il conquerroit tout nostre royaume d’Engleterre:
si que cilz homs demanda par grant sens
10 un don au roy d’Escoce, en remunerant les services
qu’il li avoit fais. Li rois d’Escoce li acorda et li dist
qu’il demandast hardiement, et qu’il li donroit, car
il estoit trop tenus à lui. Cilz homs dist: «Sire,
quant vous arés Engleterre conquis et vous departirés
15 les terres et les pays à vos gens, je vous pri que
je puisse estre vos maires de Londres, car c’est uns
moult biaus offisces. Et en toute Engleterre je ne
desir aultre cose.» Li rois d’Escoce li acorda legierement,
car ce lui coustoit peu à donner. Si fu pris
20 li rois, ensi que vous savés et qu’il gist encores en
nostre prison; mais je ne sçai que li homs est devenus,
s’il est mors ou vis: je le saroie volentiers.»
Li chevalier, qui avoient oy le conte dou roy, eurent
bon ris et disent: «Sire, nous en demanderons.»
25 Si en demandèrent et reportèrent au roy qu’il estoit
mors puis un an.
Si passa li rois oultre ce pourpos, et entra en un
aultre, que de faire assallir le fort chastiel d’Aindebourch
à l’endemain; mais ses gens, qui l’avoient
30 avisé et imaginé tout environ à leur pooir, l’en respondirent
que on s’en travilleroit en vain, et qu’il
ne faisoit mies à reprendre, fors par force d’engiens.
[155] § 354. Ensi se tint li rois d’Engleterre en Haindebourch

bien douze jours; et attendoit là ses pourveances,
vivres et artillerie, dont il avoient grant
necessité, car de bleds, de farines et de chars trouvoient
5 il petit ens ou pays. Car li Escot avoient
caciet tout leur bestail oultre le mer d’Escoce et le
rivière de Taye, où li Englès ne pooient avenir. Et
se il sentesissent que li Englès venissent avant, il
euissent tout caciet ens ès bois et ens ès forès. Et
10 avoient bouté le feu ens ès gragnes, et tout ars bleds
et avainnes, par quoi li Englès n’en euissent aise.
Pour celle deffaute convint le roy d’Engleterre et
ses gens retourner, car il n’avoient nul vivre, se il
ne leur venoient d’Engleterre, et la grosse navie dou
15 roy qui estoit cargie sus le Hombre, où bien avoit
quatre vingt gros vaissiaus de pourveances; mais
onques il ne peurent prendre terre en Escoce, là où
il tiroient à venir, car c’est uns dangereus pays pour
ariver estragniers qui ne le cognoissent. Et y eut, si
20 com je fui adonc enfourmés, par tempeste de mer,
douze nefs peries et desvoiies, et les aultres retournèrent
à Bervich.
Entrues que li rois d’Engleterre se tenoit en le
ville de Haindebourch, le vint veoir la contesse de
25 Douglas, une moult noble, frice et gentil dame, suer
au conte de Le Mare d’Escoce. La venue de la dame
resjoy moult le roy d’Engleterre, car il veoit volentiers
toutes frices dames. Et la bonne dame avoit jà
envoiiet le roy de ses bons vins, car elle demoroit à
30 cinq liewes de Haindebourch, en un fort chastiel
que on dist Dalquest: de quoi li rois l’en savoit bon
gré. La plus especiaulz cause pour quoi la bonne
[156] dame vint là, je le vous dirai. Elle avoit oy dire que
li rois d’Engleterre avoit fort maneciet d’ardoir à
son departement le plainne ville d’Aindebourch où
elle retournoit à le fois, car c’est Paris en Escoce,
5 comment que elle ne soit point fremée: si ques la
contesse Douglas, quant elle eut parlé au roy, et
li rois l’eut recueilliet et conjoy, ensi que bien le
savoit faire, elle li demanda tout en riant que il li
volsist faire grasce. Li rois li demanda de quoi,
10 qui jamais ne se fust adonnés que la dame fust là
venue pour tel cause. Et la dame li dist que il vosist
respirer de non ardoir le ville d’Aindebourch
pour l’amour de lui. «Certes, dame, respondi li rois,
plus grant cose feroi je pour l’amour de vous. Et je
15 le vous accorde liement que, pour moy ne pour mes
gens, elle n’ara jà nul mal.» Et la contesse l’en remercia
pluiseurs fois, et puis prist congiet au roy et
as barons qui là estoient; si s’en retourna en son
chastiel de Dalquest.
20 Saciés que messires Guillaumes Douglas ses maris
n’estoit mies là, mès se tenoit sus le pays ens ès bois,
à tout cinq cens armeures de fier, tous bien montés,
et n’attendoit aultre cose que le retour dou roy et
des Englès, car il disoit que il leur porteroit contraire.
25 Avoecques lui estoient li contes de Mare, li
contes de Surlant, li contes de Boskentin, li contes
d’Astrederne, messires Arcebaus Douglas ses cousins,
messires Robers de Versi, messires Guillaumes
Asneton et pluiseur bon chevalier et escuier d’Escoce
30 qui estoient tout pourveu de leur fait et savoient
les destrois et les passages, qui leur estoit grans
avantages pour porter contraire à leurs ennemis.
[157] § 355. Quant li rois d’Engleterre vei que ses

pourveances ne venroient point, et si n’en pooient
ses gens recouvrer de nulles ens ou royaume d’Escoce,
car il n’osoient chevaucier trop avant ou pays,
5 si eut conseil qu’il s’en retourneroit arrière en
Engleterre. Si ordonna à deslogier d’Aindebourch, et
de çascun mettre au retour. Ce fu une cose qui
grandement plaisi bien à la grignour partie des Englès,
car il gisoient là moult malaisiement. Et fist li
10 rois commander sus le hart que nulz ne fust si hardis,
qui au departement boutast ne mesist feu en le
ville de Haindebourh. Cilz commandemens fu
tenus.
Adonc se misent au retour li rois et ses gens pour
15 raler en Engleterre. Et vous di que il chevauçoient
en trois batailles et par bonne ordenance. Et tous
les soirs faisoient bons gais, car il se doubtoient
moult à estre resvilliet des Escos. Et bien supposoient
que li Escot estoient ensamble, mais il ne savoent
20 où ne de quel costé. Et avint un jour que, au
destroit d’une montagne où li Englès et toute leur
host devoient passer, li Escot qui cognissoient ce passage,
s’estoient mis en embusce. Et chevauçoient li
Englès par le destroit de le montagne et le malaisiu
25 chemin en pluiseurs routes; et ne cuidaissent jamais
que li Escot se fuissent mis sus ce chemin, mais si
estoient. Et savoient bien que li rois et toute sen host
devoient rapasser par là.
Ce propre jour faisoit lait et froit et plouvieus, et
30 si mauvais chevaucier, pour le vent et pour le froit,
que il ne pooit faire pieur. Li Englès, qui chevauçoient
par routes, ne savoient mies que li Escot fuissent
[158] si priès d’yaus mis en embusce. Et laissièrent li
Escot passer le première, le seconde et le tierce
route, et se boutèrent en le quarte, en escriant:
«Douglas! Douglas!» Et cuidoient certainnement
5 que li rois d’Engleterre fust en celle compagnie, car
leur espie leur avoit dit qu’il faisoit le quarte bataille.
Mais le soir devant, li Englès, par soutilleté,
avoient renouvelé leurs ordenances; et avoient fait
sept routes pour passer plus aise ces destrois, qu’il

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ECONOMICS TODAY The Macro View

• Practice—Algorithmically generated homework and study plan exercises

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• Dynamic Study Modules—With a focus on key topics, these modules work

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• NEW: Math Review Exercises in MyEconLab—MyEconLab now oﬀers an

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Roger LeRoy Miller

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Your vigor, stamina, and intellectual

Cataloging-in-Publication Data is on file at the Library of Congress

ISBN 10: 0-13-447876-2

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PART 2 Introduction to Macroeconomics and Economic Growth

PART 4 Money, Stabilization, and Growth

PART 8 Global Economics

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EXAMPLE 2 Scarcity and the World of Trade-Offs 27

EXAMPLE 3 Demand and Supply 49

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EXAMPLE 4 Extensions of Demand and Supply Analysis 75

EXAMPLE 5 Public Spending and Public Choice 100

EXAMPLE 6 Funding the Public Sector 124

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PART 2 Introduction to Macroeconomics and Economic Growth

EXAMPLE 7 The Macroeconomy: Unemployment, Inflation, and

EXAMPLE 8 Measuring the Economy’s Performance 164

POLICY EXAMPLE 9 Global Economic Growth and Development 189

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PART 3 Real GDP Determination and Fiscal Policy

EXAMPLE 11 Classical and Keynesian Macro Analyses 232

EXAMPLE 12 Consumption, Real GDP, and the Multiplier 253

INTERNATIONAL POLICY 13 Fiscal Policy 281

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APPENDIX D Fiscal Policy: A Keynesian Perspective 300

POLICY EXAMPLE 14 Deficit Spending and the Public Debt 303

PART 4 Money, Stabilization, and Growth

EXAMPLE 16 Domestic and International Dimensions of Monetary

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