This new Australian edition of Macroeconomics is published 33 years after the first US edition and eleven years after the text was first adapted for Australia. Besides its use in the lecture rooms of many universities in the US and Australia, the text has been translated into numerous languages and used in many countries: from Canada to Argentina; all over Europe; in India, Indonesia and Japan; and from China and Albania to Russia. Even before the Czech Republic gained independence from communism, an underground translation was secretly used in macroeconomics seminars at Charles University in Prague.

The enormous success of both the international edition of Macroeconomics and of the first two Australian adaptations of the text suggests that there is much going for their general approach and for the macroeconomic and methodological framework therein. With these thoughts in mind, the focus on ‘Australianising’ the international edition of the textbook has been maintained, while keeping most of the basic structure intact. Additional Australian examples and data have been added, as well as details of Australian institutional features and policy issues.

In further adapting the text for Australia, we believe that the ongoing success of the textbook reflects the unique features it brings to the universe of undergraduate macroeconomics. These features can be summarised as follows:

• ‘Compassionate difficulty’ Through the years we have held the conviction that the best textbook is one written with an abiding respect for both student and instructor. What does this mean exactly? In practice it means that we explore more state-of-the-art research than is customary in undergraduate textbooks, allowing students a point of departure for deeper exploration of various topics and teachers the flexibility to emphasise topics in greater detail. At the same time, however, we have reduced the book’s level of difficulty by providing straightforward explanations, emphasising concepts over technique and fitting difficult material into a larger framework so students can see its relevance.
• Focus on models
  The best economists have a rich ‘toolbox’ of simple models they can use to analyse various facets of the economy and know when to apply the right model to answer specific questions. This textbook focuses on the presentation of a series of simple models relevant to particular issues. We strive to help students understand the importance of a model-based approach to macroeconomic analysis as well as how the various models are connected. The goal is to produce students who have the capacity to analyse current economic issues in the context of an economic frame of reference, namely, a set of macroeconomic models.
• International perspective
  It has always been important for students living in countries with open economies like Australia to understand the important links connecting foreign economies to their own. This is becoming increasingly true as goods and financial markets become more intertwined. Recognising this, we provide two detailed chapters discussing international linkages. The first, Chapter 11, provides a discussion of mainstream intermediate international macroeconomic topics. The second, Chapter 21, gives a more advanced exploration of modern theories of the determinants of exchange rates and the choice of exchange rate regimes. These chapters give instructors the flexibility to range from touching on a few international topics to a thorough discussion lasting several weeks.
• Focus on data
  We have strived to present updated data throughout the book, demonstrating key trends and thorough discussions of how such trends might be explained by traditional macroeconomic models. We also emphasise how empirical data can test macroeconomic theory by providing numerous illustrations using real-world data.
• Focus on changing times
  While it might be argued that the Australian economy has been very stable and relatively unchanged since the second Australian edition of the book was published in 2005, clearly there have been major structural changes to the domestic economy as well as significant developments in the international economic environment. The book now includes information on the increasing influence of China and how the reliance on mining exports is creating a ‘two speed economy’ in Australia. The housing bubble in the US and ensuing Global Financial Crisis are discussed together with the US Great Recession, and the slow labour market recovery there, and the spillover of this recession as a key driver of the ongoing European Debt Crisis. The implications for the operation of monetary and fiscal policy in this sort of economic environment are laid out.

I hope that the clear, comprehensive and up-to-date coverage achieved in this book makes it one that you will both enjoy studying now and one that you will keep as an important reference book on all matters macroeconomic.

Philip Bodman
University of Queensland