Issue 13, Spring 1997

William A. McEachern, Editor

Encarta 97 Economics

Microsoft's CD-ROM Encarta 97 Encyclopedia bills itself as "the ultimate information resource" with "state-of-the-art interactive features." In the Spring 1995 issue of The Teaching Economist, I reviewed the economic content of Encarta 95, the predecessor of Encarta 97. Since Encarta 95 was the best selling multimedia encyclopedia on the market, and since students have increasingly come to rely on these computer-based alternatives as learning resources, let's review Encarta 97, especially the economic content.

Like any encyclopedia, Encarta 97's coverage of economics is spotty. There are short biographies of some economists, and some entries have been written by economists, such as articles on "economics," "money," and "capital." But many fundamental ideas such as opportunity cost, marginal cost, and sunk cost get no mention. And some key ideas are confusing. For example, here's an explanation of comparative advantage: "the comparative advantage comes if each trading partner has a product that will bring a better price in another country than it will at home." Demand is defined as "the willingness of consumers to buy a product at a certain price, or the aggregate demand of all consumers for all products and services. " Marginal utility is defined as the "worth to a consumer of the last unit in a series of similar units of a good that the consumer believes is worth acquiring." Aggregate demand is identified as "total spending in the economy." Aggregate supply is not mentioned. Another source of confusion is the use of the term supply to mean both supply and quantity supplied, and demand to mean both demand and quantity demanded.

Many of the 31,100 so-called "articles" in Encarta 97 come from Funk & Wagnall's New Encyclopedia. Some are as short as a sentence, mere definitions. About one-third involve multimedia -- that is, they involve one or more media beyond the electronic word. In 80% of the cases, the multi of the media is a picture. In terms of economics, the multimedia aspect of Encarta 97 is largely useless. For example, there were no sound clips that relate to economics and no videos or animations that developed any economic ideas. When economics is pictured, the focus is often one of pathology, such as pictures from the Great Depression. Grainy black-and-white portraits of long-dead economists make economics seem irrelavant. Most tables and charts are dated. There are a few graphs with captions (such as the market for -- what else -- widgets), but students wishing to make a copy must print graph and caption on separate pages.

So students won't find much here they can't find in any encyclopedia. What students do get with Encarta 97, however, is an improved electronic index. By entering a word or words, students can identify all the articles in Encarta 97 where the word or words appear. Encarta 97 can find adjacent word strings (Encarta 95 could find only individual words located within a few lines of one another), so students can look up terms such as division of labor (which appears in 21 articles), supply-side economics (four articles), absolute advantage (two articles), and rational expectations (a no-show). Adam Smith shows up in 27 articles, John Maynard Keynes in 15, and Alfred Marshall, Milton Friedman, and John Kenneth Galbraith in three articles.

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