Book reviews: Principles of microeconomics: An integrative approach

Principles of Microeconomics by Martin Kolmer is an economic book focusing on microeconomics that contributes to understanding the modern economy with an insight into economic theories linked with emerging social science and cultural issues. The current economy is driven by the digital era that has affected market forces and new research opportunities. In this regard, world economic issues such as comparative advantages, economic growth, price discrimination, and labour issues need to be explored (Donepudi et al., 2020; Murdock, 2020). Therefore, the book is a guiding resource for scholars engaged in economic issues. The book has fourteen (14) chapters, chapter 1 deals with introduction to economics, its scope and definitions. Describing the concept of opportunity cost in this chapter, author argues that individuals’ opportunity cost may also be irrational. The argument considers a behaviour like volunteering may substitute employment for the same job with effective use of money allocated to that job. Therefore, effective altruism is required. Chapter 2 (p. 25) discusses the theory of comparative advantage as a robust to the laws governing production. Chapter 3 covers market, market structure and contract law that support market institutions (Elsner et al., 2015: 49–53). Chapter 4 analyse the competitive market under the theories of supply and demand with inclusion of factors such as price of good, quantity, customers’ income (wealth), taste (preferences), resources for inputs, changes in technology and expectations (Berry and Haile, 2021). The author explores the interrelationship of these factors; however, there is a rare discussion given on how changes in taxes, regulations, employment and production could affect demand and supply. Chapter 5 and 6 emphasises the performance of market coordination in various economic activities with the influence of the institution’s role. In this chapter, Pareto efficiency was the main discussion elaborated as the first theorem of welfare economics (pp. 83–97). Chapter 7 discusses consumer behaviour, axioms with respective assumptions. Regarding this chapter, choices influence a firm’s decisions for a given cost analysis using substitution effects and indifference curves. Different costs and analyses were described in chapter 8 using the Cost treatment approach (p. 188). Chapter 9 elaborates on profit maximisation based on the supply behaviour of a firm, application of marginal and average cost functions. Several graphical representations were used to show a relationship between costs, revenue and marginal costs (Syverson, 2019). The monopolistic market behaviour of a firm has been discussed in chapter 10 with an in-depth clarification of price discrimination as an essential tool. The main argument is on brands are important for customers in a monopolistic market structure to increase competition in an economy. Meanwhile, chapter 11 is a game theory discussion. Chapter 12 elaborates different strategies to maximise utility with a description of the Cournot duopoly and Bertrand model (Elsner et al., 2015). However, the two models are the tip of the iceberg of the oligopolistic market behaviour models developed over the years. Chapter 13 presents a case study about the Aviation industry with a detailed discussion on the grounding of Swissair (p. 303). The author aimed to link different theories for the reader to understand complex economic and social issues. However, the author agreed it was challenging to have one sufficient case study that brings together the complexity of all economic issues related with scientific theories. Chapter 14 intricate mathematical linear functions to meet this relationship with a detailed discussion on price elasticities.