Green type indicates global example
i
ii
iii
iv
v
THIRD EDITION
Paul Krugman Robin Wells
Princeton University
WORTH PUBLISHERS
A Macmillan Higher Education Company
vi
Vice President, Editing, Design, and Media Production: Catherine Woods
Vice President, Editorial—Sciences & Social Sciences: Charles Linsmeier
Publisher, Social and Behavioral Sciences: Kevin Feyen
Associate Publisher, Economics & Geography: Steven A. Rigolosi
Executive Development Editor: Sharon Balbos
Development Editor: Mary Walsh
Editorial Assistant: Fay Kelly
Marketing Manager: Thomas Digiano
Marketing Assistant: Tess Sanders
Executive Media Editor: Rachel Comerford
Media Editor: Lukia Kliossis
Director of Development for Print and Digital: Tracey Kuehn
Product Owner—LaunchPad: Marie McHale
Managing Editor: Lisa Kinne
Project Editor: Liz Geller
Art Director: Babs Reingold
Cover Designers: Lyndall Culbertson and Babs Reingold
Interior Layout: Paul Lacy
Interior Design: Charles Yuen
Photo Editor: Cecilia Varas
Photo Researcher: Elyse Rieder
Production Manager: Barbara Anne Seixas
Supplements Production Manager: Stacey Alexander
Supplements Project Editor: Edgar Bonilla
Composition and Illustration: TSI Graphics
Printing and Binding: RR Donnelley
See page vii for credits information. Page vii is an extension of this copyright page.
ISBN-13: 978-1-4641-3905-5
ISBN-10: 1-4641-3905-9
Library of Congress Control Number: 2014932841
©2014, 2012, 2006 by Worth Publishers
All rights reserved.
Printed in the United States of America
First printing
Worth Publishers
41 Madison Avenue
New York, NY 10010
vii
Photo Credits
Front cover City of Shanghai: iStockphoto/Thinkstock. Girl writing on graph: iStockphoto/Thinkstock. Currency: Shutterstock. Gas prices: © Laura Gangi Pond/iStockphoto/Thinkstock. Welder: Thinkstock. Archival Depression photo: Everett Collection/Shutterstock. Neon sign in Spanish: Mikeledray/Shutterstock. p. xii Young woman and young man in TV store: iStockphoto/Thinkstock. p. xii Cotton boll: iStockphoto/Thinkstock. p. xiii City of Shanghai: iStockphoto/Thinkstock. Bank of England: Thinkstock. p. xiv Crowd in Hong Kong: Red Chopsticks/Getty Images. Cash transaction: Media Bakery. p. xv Warehouse worker: Moodboard/Alamy. Need job sign: Thinkstock. p. xvi Tax return check: Shutterstock. Bank vault: Jund Lund/Getty Images. p. xvii Ben Bernanke: Britt Leckman/Official Federal Reserve Photo. Printing U.S. notes: Thinkstock. p. xviii Map/coins: © Sadik Demiroz/Thinkstock. Archival Depression photo (Looking for Work): Everett Collection/Shutterstock. p. xxxvi Portrait: Rubberball/Superstock. Young woman and young man in TV store: iStockphoto. Boeing 787 Dreamliner: UPI/Alan Marts/Boeing/Landov. Hong Kong/Made in China: Kees Metselaar/Alamy. p. 1 Crowd in mall: Dmitrijs Dmitrijevs/Shutterstock. p. 30 Portrait: Chris Gramly/iStockphoto. Women wearing denim jeans: Thinkstock. Cotton field: © Fábio Salles/Dreamstime.com. Flooded farmland: AP Photo/Khalid Tanveer. p. 31 Cotton boll: iStockphoto/Thinkstock. p. 94 Portrait: Rubberball/Superstock. Photo of Hooverville: American Stock/Getty Images. Calculator: Thinkstock. Crowd in an urban setting: SFC/Shutterstock. Shelves of boxes: Andersen Ross/Getty Images. Shopping cart: Corbis/Superstock. p. 95 City of Shanghai: iStockphoto/Thinkstock. p. 130 Portrait: Stockbyte/Getty Images. Cutting staff and employee job reduction concept: Lightspring/Shutterstock. Job seekers at a career fair: Frances Roberts/Alamy. Supermarket check: Oleg Doroshin/Shutterstock. Gas station sign: AP Photo/Paul Sakuma. p. 131 Bank of England: Thinkstock. p. 170 Portrait: Chris Schmidt/Getty Images. The Iron Foundry, Burmeister & Wain, 1885 by Peder Severin Kroyer: Prisma/UIG via Getty Images. Smelting of the metal in a foundry: Kaband/Shutterstock. Circuit board manufacturing: Kim Steele/Getty Images. Busy streets in Shibuya Tokyo 2006: FocusJapan/Alamy. p. 171 Crowd in Hong Kong: Red Chopsticks/Getty Images. p. 204 Portrait: Sherrie Nickol/age fotostock. Conceptual money symbols with large group of people: Shutterstock. Wall Street bull statue: © Michael Belardo/Alamy. Time is money: Shutterstock. U.S. Savings Bonds: NoDerog/Getty Images. Stock market: Tupungato/Thinkstock. p. 205 Facebook: Knut Knipser/Media Bakery. p. 240 Portrait: © Klaus Mellenthin/Westend61/Corbis. People window shopping: Thinkstock. People carrying shopping bags: Monkey Business Images/Shutterstock. People window shopping: Thinkstock. Logs on truck: Johner Images/Alamy. Worker checking inventory: Moodboard/Alamy. p. 241 Foreclosure bus tour: AP Photo/Chris O’Meara. p. 272 Portrait: Luis Alvarez/Getty Images. Man shopping for laptop: PhotoAlto/Alamy. Welder cutting track rail: Tristan Savatier/Getty Images. Store closing sale: Dorset Media Service/Alamy. p. 273 Need job sign: Thinkstock. p. 312 Portrait: Yuri Arcurs Media/Superstock. U.S. dollars: Shutterstock. Tax return check: Shutterstock. National Debt clock: Marmaduke St. John/Alamy. Payment by credit card: Dmitriy Shironosov/Alamy. p. 313 Highway sign: AP Photo/The Plain Dealer, Scott Shaw. p. 344 Portrait: Tom Fullum/Getty Images. Paper money: Shutterstock. Money pouring out of bank vault: Jund Lund/Getty Images. Federal Reserve building: Visions of America/JoeSohm/Getty Images. p. 345 Detail of dollar bill: © Anna Delaw/Alamy. p. 376 Portrait: © HBSS/Corbis. Meeting room: AP Photo/Britt K. Leckman, Federal Reserve. Janet Yellen: Drew Angerer/Bloomberg via Getty Images. Hands with money: Shutterstock. Money graph: Jezper/Shutterstock. p. 377 Ben Bernanke: Britt Leckman/Official Federal Reserve Photo. p. 412 Portrait: Luis Alvarez/Getty Images. Printing U.S. dollar banknotes: Thinkstock. Tokyo street scene: Tom Bonaventure/Photographer’s Choice RF/Getty Images. Businessman with umbrella: Igor Stevanovic/Shutterstock. p. 413 Zimbabwe money: Trevor Kelly/Shutterstock. p. 452 Portrait: Tim Kitchen/Getty Images. Map and coins: © Sadik Demiroz/Thinkstock. Currency exchange board: © Image Source Plus/Alamy. Travelex Currency Exchange: Greg Balfour Evans/Alamy. Stacks of British currency: Millennium Images/SuperStock. p. 453 Exterior of Swiss bank: © Prisma Bildagentur AG/Alamy. p. 488 Portrait: Justin Horrocks/Getty Images. Children carrying picket signs: © Minnesota Historical Society/CORBIS. Man holding sign: Thomas W. Elliott. President Obama with senior advisors: White House Photo/Alamy. p. 489 Roosevelt signing Social Security bill: Universal History Archive/Getty Images.
viii
ix