Uni Reading List
Index / 001 EN
Principles of Economics cover

Economics

Economics

Principles of Economics

N. Gregory Mankiw

A widely used introductory textbook that presents microeconomics and macroeconomics through a small set of organising principles and a plain, example-driven writing style. Each chapter builds from everyday decisions to market outcomes and national policy, keeping the mathematics light so that the economic reasoning stays in view.

Prerequisites: No previous economics is assumed; basic algebra and the ability to read graphs are sufficient.

Difficulty Level
Beginner
Academic Level
Undergraduate
principles of economicsmicroeconomicsmacroeconomicsintroductoryTextbook

01 / Reading Guide

Reading Guide

Citation

Mankiw, N. G. (2024). Principles of Economics (10th ed.). Cengage Learning.

Chapter Summary

The tenth edition is a single volume of about 860 pages: thirty-seven chapters in thirteen parts, plus an appendix on how economists use data. Chapters 1–23 are microeconomics and Chapters 24–37 macroeconomics, so the book covers a full year of principles. Every chapter ends with Quick Quizzes, Questions for Review and Problems and Applications, and the boxed features named by the publisher are In the News, FYI, Case Study and Ask the Experts, the last reporting how the IGM panel of leading economists voted on a policy proposition. The publisher describes the aim as concentrating on the most important principles without overwhelming students with detail, written from the point of view of someone meeting economics for the first time.

Chapters 1–3: Ten Principles of Economics; Thinking Like an Economist; Interdependence and the Gains from Trade

Part I opens with the ten principles that organise the whole book, then turns to how economists think, and ends with interdependence and the gains from trade.

Chapters 4–6: The Market Forces of Supply and Demand; Elasticity and Its Application; Supply, Demand, and Government Policies

Part II, How Markets Work, builds the supply-and-demand model, adds elasticity and its applications, and applies the model to government policies.

Chapters 7–9: Consumers, Producers, and the Efficiency of Markets; Applications: The Costs of Taxation; Application: International Trade

Part III, Markets and Welfare, asks how well markets serve consumers and producers and whether they are efficient, then applies that welfare analysis to the costs of taxation and to international trade.

Chapters 10–13: Externalities; Public Goods and Common Resources; The Economics of Healthcare; The Design of the Tax System

Part IV covers the public sector: externalities, public goods and common resources, a chapter on healthcare, and the design of the tax system, one of the chapters the publisher lists as most extensively updated in this edition.

Chapters 14–18: The Costs of Production; Firms in Competitive Markets; Monopoly; Monopolistic Competition; Oligopoly

Part V, Firm Behavior and the Organization of Industry, moves from the costs of production to the four market structures, ending with oligopoly.

Chapters 19–21: The Markets for the Factors of Production; Earnings and Discrimination; Income Inequality and Poverty

Part VI turns to the labour market: factor markets, the determinants of earnings including discrimination, and inequality and poverty. Chapters 19 and 21 are among those the publisher identifies as most thoroughly updated.

Chapters 22–23: The Theory of Consumer Choice; Frontiers in Microeconomics

Part VII, Topics for Further Study, places the theory of consumer choice at the end of the micro half, followed by a chapter on frontiers of the field.

Chapters 24–25: Measuring a Nation's Income; Measuring the Cost of Living

Part VIII, The Data of Macroeconomics, covers GDP and price indexes; both chapters were extensively updated for this edition.

Chapters 26–29: Production and Growth; Saving, Investment, and the Financial System; The Basic Tools of Finance; Unemployment

Part IX, The Real Economy in the Long Run, covers production and growth, saving and investment through the financial system, the basic tools of finance, and unemployment before any short-run analysis appears.

Chapters 30–31: The Monetary System; Money Growth and Inflation

Part X, Money and Prices in the Long Run, introduces the monetary system and links money growth to inflation.

Chapters 32–33: Open-Economy Macroeconomics: Basic Concepts; A Macroeconomic Theory of the Open Economy

Part XI sets out the basic concepts of open-economy macroeconomics and then a macroeconomic theory of the open economy.

Chapters 34–36: Aggregate Demand and Aggregate Supply; The Influence of Monetary and Fiscal Policy on Aggregate Demand; The Short-Run Trade-off between Inflation and Unemployment

Part XII, Short-Run Economic Fluctuations, comes only after the long-run material: the AD–AS model, the influence of monetary and fiscal policy on aggregate demand, and the short-run trade-off between inflation and unemployment.

Chapter 37: Six Debates over Macroeconomic Policy

Part XIII, Final Thoughts, closes the book with six debates over macroeconomic policy.

Key Concepts

Chapters 1–9: Introduction, Markets and Welfare

  • Ten principles of economics: the short list of organising ideas with which the book opens.
  • Gains from trade: the benefits that interdependence and specialisation bring, between people and between countries.
  • Elasticity: the responsiveness of quantity demanded or supplied to changes in price and other conditions.
  • Efficiency of markets: the welfare standard used to judge market outcomes and the costs of taxation.

Chapters 10–23: Public Sector, Firms, Labour and Consumer Choice

  • Externalities and public goods: the main sources of market failure.
  • Market structures: competition, monopoly, monopolistic competition and oligopoly.
  • Factor markets and earnings: how factor incomes are determined, and how discrimination affects earnings.
  • Theory of consumer choice: the formal account of household decisions, placed among the topics for further study.

Chapters 24–37: Macroeconomics

  • GDP and the cost of living: measuring output and the price level.
  • Long-run growth and the financial system: production and growth over time, and the channelling of saving into investment.
  • Money growth and inflation: the long-run link between the money supply and prices.
  • Aggregate demand and aggregate supply: the short-run model of fluctuations and stabilisation policy.
  • Inflation–unemployment trade-off: the short-run relationship between the two.

Critical Analysis

Strengths

  • A clear organising framework. The ten principles of Chapter 1 give the whole book a set of reference points, and the publisher's stated aim is to keep the focus on the most important ideas rather than on exhaustive detail.
  • Long run before short run. Growth, saving and investment, unemployment and money all come before the AD–AS model, so the short-run analysis is built on a foundation of what determines output and prices over time.
  • Practice at three levels. Quick Quizzes check reading, Questions for Review test understanding, and Problems and Applications ask students to use the models; the publisher's homework system is aligned with the last of these.
  • Shows where economists agree and disagree. The Ask the Experts boxes report the IGM panel's views on policy propositions, and Chapter 37 lays out six debates over macroeconomic policy.

Limitations

  • Length and selection. At thirty-seven chapters and about 860 pages the book is far more than one semester, so instructors and self-learners have to choose.
  • Formal consumer theory comes late. The theory of consumer choice, which intermediate courses use from the start, appears only in Chapter 22, in a part labelled Topics for Further Study.
  • Digital resources at extra cost. The video lessons, adaptive test preparation and graphing tools described by the publisher are part of the paid MindTap platform.

Where It Fits in the Course

Three books on this list cover both halves of a principles course in one volume. Mankiw organises everything around ten principles and, by the publisher's account, keeps to the most important ideas. OpenStax's Principles of Economics also covers micro and macro and is free online, so students can use it alongside Mankiw for a second explanation of a difficult topic. Sloman, Garratt and Guest's Economics is a fuller first-year textbook written for UK and European courses, with more space for theory, evidence and policy. CORE Econ's The Economy 2.0: Microeconomics takes a different route, teaching through problems such as inequality, climate change and innovation and introducing models with the evidence that motivates them; it is a good companion for students who find the standard sequence abstract.

Samuel Bowles's Microeconomics: Behavior, Institutions, and Evolution is a graduate text built around social interactions and institutions, and belongs well after a principles course. The Microeconomics by Daron Acemoglu and co-authors integrates theory with empirical evidence and can serve as a more data-oriented complement to Mankiw's microeconomic chapters.

How to Use This Book

No previous economics is assumed; basic algebra and the ability to read graphs are sufficient.

  • Micro semester: Chapters 1–18, adding 19–21 if labour markets are covered. Read Chapter 22 if you are going on to intermediate microeconomics, because it introduces the consumer-choice framework intermediate courses use.
  • Macro semester: Chapters 1–3 for the framework, then 24–36. Chapters 26–31 (the long run) are the foundation; Chapters 34–36 build the short-run model.
  • Optional: Chapter 12 (healthcare), Chapter 23 (frontiers in microeconomics) and Chapter 37 (six debates) are natural candidates for reading on your own; Chapter 37 is a good review at the end of a macro course.
  • Practice: do the Quick Quizzes as you read and at least a selection of the Problems and Applications for each chapter; use the In the News and Ask the Experts boxes as starting points for discussion.

Revisit Chapter 1 at the end of the course: the ten principles serve as a compact summary of what the book has taught.