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Our book is built around economic topics, such as the income tax code, the social security system, the determination of monetary policy in Europe, and the contrasting economic health of different countries.
Throughout this book, we will emphasize the measurement and interpretation of economic data. Understanding how to read charts and tables of economic data is a critical skill for anyone who wants to be a sophisticated consumer of economic and political news. We also explain both policy tools and their links to economic outcomes. Understanding these links requires a model of the economy. We introduce models as needed, in the context of their applications. Mastering macroeconomics involves both understanding the tools that macroeconomists use and knowing how and when those tools should be applied. In this book, you will learn about these tools by example: you will see them in use as we study different questions in economics. At the same time, you will learn about many topics that should interest you as engaged and aware citizens of the world. We hope that, after reading this book, you will both better understand what it is that economists do and be better informed about the world in which we all live.
As you proceed through the chapters, you will often see reference to our toolkit. This is a collection of some of the most important tools that we use over and over in different chapters. Each tool is fully introduced somewhere in the book, but you can also use the toolkit as a reference when working through different chapters. In addition, it can serve as a study aid when you are preparing for quizzes and examinations.
We try to avoid getting too hung up on the mathematical expression of our theories (although the math will usually be lurking in the background where you can’t quite see it). In particular, our applications chapters contain very little mathematics. This means that you can read and understand the applications without needing to work through a lot of mathematics. Compared to our applications chapters, our toolkit contains slightly more formal versions of the frameworks that we develop. You will refer to the tools over and over again as we progress through the book, for the same tool is often used to shed light on all sorts of different questions.