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Economics: Making Sense of the Modern Economy (The Economist) (9781118010426): The Economist, Saugato Datta: Books. Now in its third and radically revised edition, this highly readable, hugely popular guide to economics is aimed at everyone from students to statesmen who want to grasp how economic theory works in practice and make sense of the modern world.Part one considers what economics is about. It starts with debates about basic economic ideas, then covers the sources of economic growth such as investments in equipment and in people's skills; the role of central banks and fiscal policy in managing the ups and downs of the economic cycle; and the insights that economics provides into a vast variety of things, ranging from credit card fees to prostitution.Part two moves from the underlying theory to an overview of the world economy: the forces shaping the world economy, including the rise of emerging economies, global imbalances and the runaway world of finance; the recent great recession—why it happened, how it was dealt with, its effects, legacy, and the challenges before the global economy in the years ahead.Part three puts the usefulness of economics under the spotlight. It looks at the criticisms of the dismal science by those who think it needs to change to regain its relevance, and also at the ways in which economics is changing through the use by economists of new tools and techniques—sometimes borrowed from other disciplines—to help them understand the way the world works today.

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