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WCN 02-200-203
Fourteenth Edition
MACROECONOMICS
PRINCIPLES and POLICY
William J. Baumol
New York University and Princeton University
Alan S. Blinder
Princeton University
John L. Solow
University of Iowa and University of Central Florida
Australia • Brazil • Mexico • Singapore • United Kingdom • United

States Copyright 2020 Cengage Learning. All Rights Reserved.
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WCN 02-200-203

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Macroeconomics: Principles and Policy,
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Print Number: 01 Print Year: 2019

WCN 02-200-203

and/or eChapter(s).
To our wonderful wives, Madeline Blinder and Catherine Solow.

WCN 02-200-203

and/or eChapter(s).
BRIEF CONtENtS
Preface xix
About the Authors xxi
Part 1
Getting Acquainted with Economics 1
Chapter 1 What Is Economics? 3
Chapter 2 The Economy: Myth and Reality 19
Chapter 3 The Fundamental Economic Problem: Scarcity
and Choice 36
Chapter 4 Supply and Demand: An Initial Look 54
Part 2
The Macroeconomy: Aggregate Supply and Demand 81
Chapter 5 An Introduction to Macroeconomics 83
Chapter 6 The Goals of Macroeconomic Policy 103
Chapter 7 Economic Growth: Theory and Policy 128

Chapter 8 Aggregate Demand and the Powerful Consumer 147
Chapter 9 Demand-Side Equilibrium: Unemployment or Inflation? 169
Chapter 10 Bringing in the Supply Side: Unemployment and
Inflation? 193
Part 3
Fiscal and Monetary Policy 213
Chapter 11 Managing Aggregate Demand: Fiscal Policy 215
Chapter 12 Money and the Banking System 235
Chapter 13 Monetary Policy: Conventional and Unconventional 257
Chapter 14 The Financial Crisis and the Great Recession 277
Chapter 15 The Debate Over Monetary and Fiscal Policy 292
Chapter 16 Budget Deficits in the Short and Long Run 312
Chapter 17 The Trade-Off Between Inflation and Unemployment 331
Part 4
The United States in the World Economy 349
Chapter 18 International Trade and Comparative Advantage 351
Chapter 19 The International Monetary System: Order or
Disorder? 372
Chapter 20 Exchange Rates and the Macroeconomy 391
iv
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Brief Contents
Part 5
The Economy Today 405
Chapter 21 Contemporary Issues in the U.S. Economy 407
Appendix 416
Glossary 428
Index 434

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tABLE OF CONtENtS
Preface xix
About the Authors xxi
Part 1
Getting Acquainted with Economics 1
Chapter 1 What Is Economics? 3
1-1 Ideas for Beyond the fInal exam 3
1-1a
Idea 1: How Much Does It Really Cost? 4
1-1b
Idea 2: Attempts to Repeal the Laws of Supply and Demand—The

Market Strikes Back 4
1-1c
Idea 3: The Surprising Principle of Comparative Advantage 5

1-1d
Idea 4: Trade Is a Win–Win Situation 5
1-1e
Idea 5: Government Policies Can Limit Economic Fluctuations—But

Don’t Always Succeed 5
1-1f
Idea 6: The Short-Run Trade-Off between Inflation and

Unemployment 6
1-1g
Idea 7: Productivity Growth Is (Almost) Everything in the Long Run 6
1-1h Epilogue 6
1-2 InsIde the economIst’s tool KIt 7
1-2a
Economics as a Discipline 7
1-2b
The Need for Abstraction 7
1-2c
The Role of Economic Theory 8
1-2d
What Is an Economic Model? 10
1-2e
Reasons for Disagreements: Imperfect Information and Value
Judgments 11
Summary 12
Key Terms 12
Discussion Questions 12
APPendix Using Graphs: A Review 12
Graphs Used in Economic Analysis 12
Two-Variable Diagrams 13
The Definition and Measurement of Slope 13
Rays through the Origin and 45° Lines 15
Squeezing Three Dimensions into Two: Contour Maps 16
Summary 17
Key Terms 17
Test Yourself 18
Chapter 2 The Economy: Myth and Reality 19
2-1 the amerIcan economy: a thumBnaIl sKetch 19
2-1a
A Private-Enterprise Economy 21
2-1b
A Relatively “Closed” Economy 21

2-1c
A Growing Economy . . . 22
2-1d
But with Bumps along the Growth Path 23
2-2 the Inputs: laBor and capItal 23
2-2a
The American Workforce: Who Is in It? 23
2-2b
The American Workforce: What Does It Do? 27
2-2c
The American Workforce: What Does It Earn? 27
2-2d
Capital and Its Earnings 28
vi

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Table of Contents
vii
2-3 the outputs: What does amerIca produce? 29
2-4 the central role of BusIness fIrms 30
2-5 What’s mIssIng from the pIcture? government 31
2-5a
The Government as Referee 32
2-5b
The Government as Business Regulator 32
2-5c
Government Expenditures 32
2-5d
Taxes in America 33
2-5e
The Government as Redistributor 33
2-6 conclusIon: It’s a mIxed economy 34
Summary 35
Key Terms 35
Chapter 3 The Fundamental Economic Problem: Scarcity and

Choice 36
Issue: What to Do about the Federal Budget? 36
3-1 scarcIty, choIce, and opportunIty cost 37
3-1a
Opportunity Cost and Money Cost 38
3-1b
Optimal Choice: Not Just Any Choice 38
3-2 scarcIty and choIce for a sIngle fIrm 39
3-2a
The Production Possibilities Frontier 39
3-2b
The Principle of Increasing Costs 41
3-3 scarcIty and choIce for the entIre socIety 41
3-3a
Scarcity and Choice Elsewhere in the Economy 42
Issue RevIsIteD: Agreeing on a Federal Budget 43
3-4 the three coordInatIon tasKs of any economy 43
3-5 the concept of effIcIency 43

3-6 tasK 1. hoW the marKet fosters effIcIent resource allocatIon 45
3-6a
The Wonders of the Division of Labor 45
3-6b
The Amazing Principle of Comparative Advantage 45
3-6c
The Arithmetic of Comparative Advantage and Trade 46
3-6d
The Graphics of Comparative Advantage and Trade 48
3-7 tasK 2. marKet exchange and decIdIng hoW much of each good
to produce 49
3-8 tasK 3. hoW to dIstrIBute the economy’s outputs among

consumers 50
3-9 looKIng ahead 51
Summary 51
Key Terms 52
Test Yourself 52
Chapter 4 Supply and Demand: An Initial Look 54
Puzzle: What Happened to Oil Prices? 54

4-1 the InvIsIBle hand 55
4-2 demand and QuantIty demanded 56
4-2a
The Demand Schedule 56
4-2b
The Demand Curve 57
4-2c
Shifts of the Demand Curve 57
4-3 supply and QuantIty supplIed 60
4-3a
The Supply Schedule and the Supply Curve 61
4-3b
Shifts of the Supply Curve 61
4-4 supply and demand eQuIlIBrIum 63
4-4a
The Law of Supply and Demand 65
4-5 effects of demand shIfts on supply-demand eQuIlIBrIum 65

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viii
Table of Contents
4-6 supply shIfts and supply-demand eQuIlIBrIum 67
Puzzle ResOlveD: those volatile Oil Prices 68
4-6a
Application: Who Really Pays That Tax? 69
4-6b Speculation 70
4-7 BattlIng the InvIsIBle hand: the marKet fIghts BacK 71
4-7a
Restraining the Market Mechanism: Price Ceilings 71
4-7b
Case Study: Rent Controls in New York City 72
polIcy deBate Economic Aspects of the War on Drugs 72
4-7c
Restraining the Market Mechanism: Price Floors 73

4-7d
Case Study: Farm Price Supports and the Case of Sugar Prices 74
4-7e
A Can of Worms 75
4-8 a sImple But poWerful lesson 76
Summary 76
Key Terms 77
Test Yourself 77
Part 2
The Macroeconomy: Aggregate Supply and Demand 81
Chapter 5 An Introduction to Macroeconomics 83
Issue:
How Did the Housing Bust lead to the Great Recession? 83
5-1 draWIng a lIne BetWeen macroeconomIcs and mIcroeconomIcs

84
5-1a
Aggregation and Macroeconomics 84
5-1b
The Foundations of Aggregation 84

5-1c
The Line of Demarcation Revisited 85
5-2 supply and demand In macroeconomIcs 85
5-2a
A Quick Review 85
5-2b
Moving to Macroeconomic Aggregates 86
5-2c Inflation 86
5-2d
Recession and Unemployment 86
5-2e
Economic Growth 86
5-3 gross domestIc product 87
5-3a
Money as the Measuring Rod: Real versus Nominal GDP 88
5-3b
What Gets Counted in GDP? 88
5-3c
Limitations of the GDP: What GDP Is Not 89
5-4 the economy on a roller coaster 91

5-4a
Growth, but with Fluctuations 91
5-4b
Inflation and Deflation 92
5-4c
The Great Depression 93
5-4d
From World War II to 1973 95
5-4e
The Great Stagflation, 1973–1981 96
5-4f
Reaganomics and Its Aftermath 96
5-4g
Clintonomics: Deficit Reduction and the “New Economy” 97
5-4h
Tax Cuts and the Bush Economy 97
5-4i
Obamanomics and the Great Recession 98
5-4j
What Is Trumponomics? 98
Issue RevIsIteD: How Did the Housing Bust lead to the Great
Recession? 98
5-5 the proBlem of macroeconomIc staBIlIzatIon: a sneaK prevIeW

99
5-5a
Combating Unemployment 99
5-5b
Combating Inflation 99
5-5c
Does It Really Work? 100
Summary 100
Key Terms 101
Test Yourself 101

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Table of Contents ix
Chapter 6 The Goals of Macroeconomic Policy 103
6-1 the goal of economIc groWth 104
Issue:
Is Faster Growth Always Better? 105
6-2 the capacIty to produce: potentIal gdp and the productIon

functIon 105
6-3 the groWth rate of potentIal gdp 107
Issue RevIsIteD: Is Faster Growth Always Better? 108
6-4 the goal of loW unemployment 109
6-5 the human costs of hIgh unemployment 109
6-6 countIng the unemployed: the offIcIal statIstIcs 111
6-7 types of unemployment 112
polIcy deBate Does the Minimum Wage Cause Unemployment? 112
6-8 hoW much employment Is “full employment”? 113
6-9 unemployment Insurance: the InvaluaBle cushIon 113
6-10 the goal of loW InflatIon 114
6-10a
Inflation and Real Wages 114

6-10b
The Importance of Relative Prices 116
6-11 InflatIon as a redIstrIButor of Income and Wealth 117
6-12 real versus nomInal Interest rates 117
6-13 InflatIon dIstorts measurements 118
6-13a
Confusing Real and Nominal Interest Rates 118
6-13b
The Malfunctioning Tax System 119
6-14 other costs of InflatIon 119
6-15 the costs of loW versus hIgh InflatIon 120
6-16 loW InflatIon does not necessarIly lead to hIgh InflatIon 121
Summary 122
Key Terms 123
Test Yourself 123
APPendix How Statisticians Measure Inflation 124
Index Numbers for Inflation 124
The Consumer Price Index 124
Using a Price Index to “Deflate” Monetary Figures 125

Using a Price Index to Measure Inflation 125
The GDP Deflator 126
Summary 126
Key Terms 126
Test Yourself 126
Chapter 7 Economic Growth: Theory and Policy 128
Puzzle:
Why Does College education Keep Getting More expensive?

129
7-1 the three pIllars of productIvIty groWth 129
7-1a Capital 129
7-1b Technology 130
7-1c
Labor Quality: Education and Training 130
7-2 levels, groWth rates, and the convergence hypothesIs 131
7-3 groWth polIcy: encouragIng capItal formatIon 133
7-4 groWth polIcy: ImprovIng educatIon and traInIng 136
7-5 groWth polIcy: spurrIng technologIcal change 137
7-6 recent productIvIty performance In the unIted states 138
7-6a
The Productivity Slowdown, 1973–1995 138
7-6b
The Productivity Speed-up, 1995–2010 140
7-6c
The Productivity Slowdown Since 2010 141
Puzzle ResOlveD: Why the Relative Price of College tuition

Keeps Rising 141

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Table of Contents
7-7 groWth In the developIng countrIes 142
7-7a
The Three Pillars Revisited 142
7-7b
Some Special Problems of Developing Countries 144
7-8 from the long run to the short run 145
Summary 145
Key Terms 145
Test Yourself 146
Chapter 8 Aggregate Demand and the Powerful Consumer

147
Issue:
Demand Management and the Ornery Consumer 148
8-1 aggregate demand, domestIc product, and natIonal Income 148
8-2 the cIrcular floW of spendIng, productIon, and Income 149
8-3 consumer spendIng and Income: the Important relatIonshIp 151
8-4 the consumptIon functIon and the margInal propensIty to

consume 154
8-5 factors that shIft the consumptIon functIon 155
polIcy deBate Using the Tax Code to Spur Saving 157
Issue RevIsIteD: Why temporary tax Cuts Have Only Modest

effects on spending 157
8-6 the extreme varIaBIlIty of Investment 158
8-7 the determInants of net exports 159

8-7a
National Incomes 159
8-7b
Relative Prices and Exchange Rates 160
8-8 hoW predIctaBle Is aggregate demand? 160
Summary 161
Key Terms 161
Test Yourself 162
APPendix National Income Accounting 162
Defining GDP: Exceptions to the Rules 162
GDP as the Sum of Final Goods and Services 163
GDP as the Sum of All Factor Payments 164
GDP as the Sum of Values Added 165
Summary 167
Key Terms 167
Test Yourself 167
Chapter 9 Demand-Side Equilibrium: Unemployment or

Inflation? 169
Issue:
Why Does the Market Permit High unemployment? 169
9-1 the meanIng of eQuIlIBrIum gdp 170
9-2 the mechanIcs of Income determInatIon 171
9-3 the aggregate demand curve 174
9-4 demand-sIde eQuIlIBrIum and full employment 176
9-5 the coordInatIon of savIng and Investment 178
9-6 changes on the demand sIde: multIplIer analysIs 179
9-6a
The Magic of the Multiplier 179
9-6b
Demystifying the Multiplier: How It Works 181
9-6c
Algebraic Statement of the Multiplier 182
9-7 the multIplIer Is a general concept 183
9-8 the multIplIer and the aggregate demand curve 185
Summary 186
Key Terms 186
Test Yourself 187

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Table of Contents xi
APPendix A The Simple Algebra of Income Determination and the

Multiplier 188
Test Yourself 189
APPendix B The Multiplier with Variable Imports 190
Summary 192
Test Yourself 192
Chapter 10 Bringing in the Supply Side: Unemployment and

Inflation? 193
Puzzle:
What Causes stagflation? 193
10-1 the aggregate supply curve 194

10-1a
Why the Aggregate Supply Curve Slopes Upward 194
10-1b
Shifts of the Aggregate Supply Curve 195
10-2 eQuIlIBrIum of aggregate demand and supply 197
10-3 InflatIon and the multIplIer 198
10-4 recessIonary and InflatIonary gaps revIsIted 199
10-5 adjustIng to a recessIonary gap: deflatIon or unemployment?

201
10-5a
Why Nominal Wages and Prices Won’t Fall (Easily) 201
10-5b
Does the Economy Have a Self-Correcting Mechanism? 203
10-5c
An Example from Recent History: Deflation Worries in the United

States 203
10-6 adjustIng to an InflatIonary gap: InflatIon 203
10-6a
Demand Inflation and Stagflation 204
10-6b
A U.S. Example 204

10-7 stagflatIon from a supply shocK 205
10-8 applyIng the model to a groWIng economy 206
10-8a
Demand-Side Fluctuations 208
10-8b
Supply-Side Fluctuations 209
Puzzle ResOlveD: explaining stagflation 210
10-9 a role for staBIlIzatIon polIcy 210
Summary 211
Key Terms 211
Test Yourself 211
Part 3
Fiscal and Monetary Policy 213
Chapter 11 Managing Aggregate Demand: Fiscal Policy 215
Issue:
Did the u.s. Need a tax Cut in 2018? 215
11-1 Income taxes and the consumptIon schedule 216
11-2 the multIplIer revIsIted 217
11-2a
The Tax Multiplier 217
11-2b
Income Taxes and the Multiplier 217
11-2c
Automatic Stabilizers 219
11-2d
Government Transfer Payments 219
Issue RevIsIteD: the tax Cut Debate in 2017 220
11-3 plannIng expansIonary fIscal polIcy 220
11-4 plannIng contractIonary fIscal polIcy 221
11-5 the choIce BetWeen spendIng polIcy and tax polIcy 221
Issue ReDux: Aggregate Demand and the tax Cuts of 2017

222
11-6 some harsh realItIes 223
11-7 the Idea BehInd supply-sIde tax cuts 223
11-7a
Some Flies in the Ointment 225
Issue:
the Partisan Debate Once More 226
11-7b
Toward an Assessment of Supply-Side Economics 226

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xii
Table of Contents
Summary 227
Key Terms 228
Test Yourself 228
APPendix A Graphical Treatment of Taxes and Fiscal Policy 229
Multipliers for Tax Policy 231
Summary 231
Key Terms 231
Test Yourself 232

APPendix B Algebraic Treatment of Taxes and Fiscal Policy 232
Test Yourself 234
Chapter 12 Money and the Banking System 235
Issue:
Why Are Banks so Heavily Regulated? 235
12-1 the nature of money 236
12-1a
Barter versus Monetary Exchange 237
12-1b
The Conceptual Definition of Money 237
12-1c
What Serves as Money? 238
12-2 hoW the QuantIty of money Is measured 240
12-2a M1 240
12-2b M2 240
12-2c
Other Definitions of the Money Supply 241
12-3 the BanKIng system 241
12-3a
How Banking Began 241
12-3b
Principles of Bank Management: Profits versus Safety 243
12-3c
Bank Regulation 244
12-3d
Deposit Insurance 244
12-3e
Bank Supervision 245
12-3f
Reserve Requirements 245
12-4 systemIc rIsK and the “too BIg to faIl” doctrIne 245
12-5 the orIgIns of the money supply 247
12-5a
How Bankers Keep Books 247
12-6 BanKs and deposIt creatIon 248
12-6a
The Limits to Deposit Creation by a Single Bank 248
12-6b
Multiple Deposit Creation by a Series of Banks 249

12-6c
The Process in Reverse: Multiple Contraction of Bank Deposits 251
12-7 Why the deposIt-creatIon formula Is oversImplIfIed 252
12-8 the need for monetary polIcy 253
Summary 254
Key Terms 255
Test Yourself 255
Chapter 13 Monetary Policy: Conventional and

Unconventional 257
Issue: Why Resort to “unconventional” Monetary Policies?

257
13-1 money and Income: the Important dIfference 258
13-2 amerIca’s central BanK: the federal reserve system 258
13-2a
Origins and Structure 258
13-2b
Central Bank Independence 259
13-3 ImplementIng monetary polIcy In normal tImes: open-marKet
operatIons 260
13-3a
The Market for Bank Reserves 261
13-3b
The Mechanics of an Open-Market Operation 262

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Table of Contents xiii
13-3c
Open-Market Operations, Bond Prices, and Interest Rates 264
13-3d
Which Interest Rate? 264
13-4 other Instruments of monetary polIcy 266
13-4a
Lending to Banks 266
13-4b
Changing Reserve Requirements 268
13-4c
Quantitative Easing 268
13-5 hoW monetary polIcy WorKs In normal tImes 269
13-5a
Investment and Interest Rates 269
13-5b
Monetary Policy and Total Expenditure 270
13-6 money and the prIce level 271
13-7 applIcatIon: Why the aggregate demand curve slopes

doWnWard 272
13-8 unconventIonal monetary polIcIes 273
13-9 from fInancIal dIstress to recessIon 273
13-10 from models to polIcy deBates 275
Summary 274
Key Terms 275
Test Yourself 275
Chapter 14 The Financial Crisis and the Great Recession 277
Issue: Did the Fiscal stimulus Work? 277

14-1 roots of the crIsIs 278
14-2 leverage, profIts, and rIsK 279
14-3 the housIng prIce BuBBle and the suBprIme mortgage crIsIs
280
14-4 from the housIng BuBBle to the fInancIal crIsIs 282
14-5 from the fInancIal crIsIs to the great recessIon 285
14-6 hIttIng Bottom and recoverIng 289
Issue RevIsIteD: Did the Fiscal stimulus Work? 289
14-7 lessons from the fInancIal crIsIs 289
Summary 290
Key Terms 291
Test Yourself 291
Chapter 15 The Debate Over Monetary and Fiscal Policy 292
Issue:
should We Forsake stabilization Policy? 292
15-1 velocIty and the QuantIty theory of money 293
15-1a
Some Determinants of Velocity 295
15-1b
Monetarism: The Quantity Theory Modernized 295
15-2 deBate: should the fed use unconventIonal monetary polIcIes?

296
polIcy deBate: Does Money Growth Always Cause Inflation? 296
15-3 deBate: should polIcymaKers fIght asset prIce BuBBles? 299
15-4 deBate: should We rely on fIscal or monetary polIcy? 300
15-5 deBate: the shape of the aggregate supply curve 302
15-6 deBate: should the government Intervene at all? 304
15-6a
Lags and the Rules-versus-Discretion Debate 305
15-7 dImensIons of the rules-versus-dIscretIon deBate 305
15-7a
How Fast Does the Economy’s Self-Correcting Mechanism Work? 206
15-7b
How Long Are the Lags in Stabilization Policy? 306
15-7c
How Accurate Are Economic Forecasts? 306
15-7d
The Size of Government 306
15-7e
Uncertainties Caused by Government Policy 307
15-7f
A Political Business Cycle? 307
Issue RevIsIteD: What should Be Done? 309

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xiv
Table of Contents
Summary 309
Key Terms 310
Test Yourself 310
Chapter 16 Budget Deficits in the Short and Long Run 312
Issue:
Is the Federal Government Budget Deficit too large? 312
16-1 should the Budget alWays Be Balanced? the short run 313
16-2 the Importance of the polIcy mIx 314
16-2a
The Multiplier Formula Revisited 315
16-2b
The Government Budget and Investment 315
16-3 defIcIts and deBt: termInology and facts 317
16-3a
Some Facts about the National Debt 317
16-4 InterpretIng the Budget defIcIt or surplus 319
16-4a
The Structural Deficit or Surplus 319
16-4b
Conclusion: What’s Happened to the Deficit? 320
16-5 Why Is the natIonal deBt consIdered a Burden? 321
16-6 Budget defIcIts and InflatIon 322
16-6a
The Monetization Issue 323
16-7 deBt, Interest rates, and croWdIng out 324

16-7a
The Bottom Line 325
16-8 the maIn Burden of the natIonal deBt: sloWer groWth 326
Issue RevIsIteD: Is the Budget Deficit still too large? 327
16-9 the economIcs and polItIcs of the u.s. Budget defIcIt 328
Summary 329
Key Terms 330
Test Yourself 330
Chapter 17 The Trade-Off Between Inflation and

Unemployment 331
Issue:
Is the trade-Off between Inflation and unemployment a Relic

of the Past? 331
17-1 demand-sIde InflatIon versus supply-sIde InflatIon: a revIeW

332
17-2 orIgIns of the phIllIps curve 333
17-3 supply-sIde InflatIon and the collapse of the phIllIps curve 335
17-3a
Explaining the Fabulous Late 1990s 335
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DISEASES AND INJURIES.
With ordinary care in cleanliness, freedom from cold damp drafts,

and a well-regulated food supply, canaries are subject to few ills. In
fact, most of their troubles may be traced to some untoward
circumstance in handling them. Their diseases are very little
understood and correct diagnosis is difficult, and though much has
been written regarding them this has served mainly to reveal general
ignorance on the subject. Present knowledge does not warrant an
exhaustive account of diseases, but in the following notes
information is given on the more usual complaints of canaries.
When canaries become sick the first care should be to see that the
diet is proper and to examine into the general sanitary conditions
under which the birds are living. If canaries are confined in company
with others, sick birds must be removed at once to a separate cage,
since their companions will continually peck and worry them. Where
numbers of canaries are kept, as a precaution to prevent spread of
contagious or infectious diseases ailing birds should be removed
from the bird room. It is always well to move a sick bird to a warm
place. Heat and protection from drafts work wonders with ailing
canaries and often are sufficient alone to restore them to health.
When medicine is necessary it is best to administer it in the
drinking water. If this can not be done it may be given directly in the
bill by means of a quill or a medicine dropper. In administering
medicines it must be remembered that a canary is small and that a
single drop in most cases is a large dose. Indiscriminate dosing of
birds with various remedies is to be avoided.
The few instructions that follow are not to be regarded as infallible,
but they may be of assistance in simple ailments. When a bird is
seriously ill there is usually little chance of its recovery.
BROKEN LIMBS.
In case of bad fractures or injuries it is perhaps best for all
concerned to end the trouble by killing the bird. If a valuable bird
breaks a leg, a slender splint of wood wrapped in a slight wisp of
cotton and held by a bandage may be applied with care. This
support must not be touched for two or three weeks, but then it may
be removed entirely. When the break occurs in the lower leg (tarsus)
a small quill makes a simple support. The quill is split and cut down
until it fits snugly around the part affected. It is then padded inside
with a few shreds of cotton and tied carefully in place with silk
thread.
Broken wings should be allowed to heal without outside
interference. All high perches should be removed from the cage, and
food and water made easily accessible. A bird with a broken wing
must be kept as quiet as possible in order that the fracture may heal.
LOSS OF FEATHERS ABOUT HEAD.
Baldness is sometimes occasioned by mites or bird lice and may

be treated best by removing the cause. Loss of feathers about the
head, however, may indicate old age or general debility. At the
natural time of molt the growth of feathers on the bare spots may be
aided by warmth and a well-regulated diet. In addition to the usual
food, twice a week give a little bread moistened with milk which has
been dusted with a mixture of two parts of sulphur to one of
potassium chlorate. At the same intervals rub a little carbolized
petrolatum on the bare places. Baldness is said to arise at times,
particularly in spring, through failure to provide the canary with
lettuce, apple, or other green food. In such cases improvement may
be made by supplying this need.
RESPIRATORY TROUBLES.
The fact that canaries are injured by cold drafts can not be too
strongly emphasized, and it may be said that a large proportion of
their common ailments come from such exposure. In many cases
exposure is followed by congestion in the intestinal region, and death
ensues in a very short time. In ordinary colds there is difficulty in
breathing and some liquid discharge from the nose. Frequently this
is accompanied by coughing. A bird thus affected should be kept in a
warm room free from all drafts and protected from irritating dust,
vapor, or tobacco smoke. The symptoms are increased as the cold
progresses and becomes acute, and the bird sits with feathers
puffed out, seeming really ill. Breathing is difficult and rapid. If there
is enough catarrhal secretion partly to block the respiratory passages
a slight bluish tint is noticed beneath the transparent sheath of the
bill. As a remedy, place in the drinking cup 1 ounce of water to which
have been added 20 drops of sirup of tolu, 10 of sweet spirits of
niter, and 10 of glycerin.
Pneumonia in cage birds often follows exposure and is nearly
always fatal. The symptoms, rapid and difficult breathing with little
catarrhal discharge, appear suddenly. The bird becomes very weak
at once and usually dies in from two to seven days. Little can be
done beyond sheltering the bird, as noted above, and providing an
easily assimilated food, as egg food and bread moistened in milk.
Asthma is a chronic affection, in which there is difficulty in
expiration of air in breathing. In severe cases a contraction of the
abdominal muscles is evident in forcing the air from the lungs.
Asthma is more in evidence at night, and often birds apparently free
from it during the day will wheeze when at rest. There is practically
nothing that can be done for it. Sometimes a semblance of asthma is
caused by indigestion from overeating. Fanciers consider asthma
hereditary and do not recommend birds so affected for breeding
purposes.
INTESTINAL COMPLAINTS.
Intestinal troubles in canaries arise in most cases from the food or

water supply and are avoided by cleanliness and proper care. Dirty
water cups with foul water, decayed or soured fresh or soft foods, or
a poor seed supply lead inevitably to trouble. Should the canary
contract diarrhea, remove all green and soft foods from the cage for
a time and give only the normal seed supply. As a remedy, add a
small quantity of Epsom salts to the drinking water for a day. If there
is no improvement, feed the bird a bit of moist bread, with the
surface covered lightly with bismuth (subnitrate), or place an ounce
of water in the drinking cup, to which have been added three or four
drops of tincture of opium. For constipation, the addition of lettuce,
apple, chickweed, or other green food to the regular menu is usually
sufficient; if not, a pinch of Epsom salts may be added to the drinking
water. The quantity of the purgative should be enough to impart a
faintly saline taste to the solution. Castor oil is not a good corrective
remedy for small birds.
Occasionally birds in confinement “go light,” or waste away until
they are far below their normal standard of plumpness, without
marked symptoms of disease. In such cases change the seed
supply, making sure that the seed is fresh and wholesome, and vary
the diet with green foods, and with bread softened with milk. It is also
beneficial to change the location of the cage; if possible, place the
cage where it will receive the sun for a few hours each day, except in
the heat of midsummer. Make sure that the canary is not infested
with mites.
When worms are present, as sometimes happens, small
fragments of these internal parasites may be seen in the droppings
when the cage is cleaned. As a remedy, place in the drinking cup 8
or 10 drops of tincture of gentian in an ounce of water. This may be
given for two days, and, in addition, two drops of olive oil may be
administered in the bill by means of a medicine dropper.
For more serious complaints than those enumerated it will be well,
if possible, for the amateur to seek the advice of some person with
experience in handling cage birds.
BIBLIOGRAPHY.
For the benefit of those who may wish further information on the
care of canaries a short list of standard works on the subject is
appended. (None of these is available for free distribution by the
United States Department of Agriculture.)[4]
BOOKS.
Battye, H. W.
Yorkshire Canaries, How to Breed, Manage, and Exhibit.
80 pp., ill. F. Carl, 154 Fleet St., London, E. C.
Boaler, G. H.
Seeds, Foods, and Wild Plants for Cage Birds. 97 pp., ill.
F. Carl, 154 Fleet St., London, E. C.
Brunskill, E.
Canary Culture for Amateurs. F. Carl, 154 Fleet St.,
London, E. C.
Church, T. A.
The Roller; Concerning Its Health, Habits, Feeding, etc.
223 pp., ill. Stuyvesant Press, New York, N. Y.
Crandall, L. S.
Pets; Their History and Care. Ill. H. Holt & Co., New York,
N. Y.
——
Pets and How to Care for Them. Ill. Pub. by New York
Zoological Park, New York, N. Y.
Creswell, W. G.
The Hygiene of Bird Keeping. F. Carl, 154 Fleet St.,
London, E. C.
House, C. A.
Canary Manual. 130 pp., ill. F. Carl, 154 Fleet St., London,
E. C.
——
Norwich Canaries. 48 pp., ill. F. Carl, 154 Fleet St,
London, E. C.
Lewer, S. H.
Canaries, Hybrids, and British Birds in Cage and Aviary.
424 pp., 26 pls. (color), and other ills. Waverly Book
Co., 7 and 8 Old Bailey, London, E. C.
Norman, H.
Aviaries, Bird Rooms, and Cages. F. Carl, 154 Fleet St.,
London, E. C.
Page, W. T.
Foreign Birds for Beginners. 60 pp., ill. F. Carl, 154 Fleet
St., London, E. C.
Ramsden, J. W.
The Colour Feeding of Canaries and Other Birds. F. Carl,
154 Fleet St., London, E. C.
St. John, C.
Our Canaries: A Thoroughly Practical and Comprehensive
Guide to the Successful Keeping, Breeding, and
Exhibiting of Every Known Variety of the
Domesticated Canary. 32 pls. (color) and many ills.
Pub. in 16 parts, 1910-11. F. Carl, 154 Fleet St.,
London, E. C.
Verrill, A. H.
Pets for Pleasure and Profit. 359 pp., 152 ills. 1915.
Charles Scribners’ Sons, New York, N. Y.
PERIODICALS.
Avicultural Magazine. Pub. for the Avicultural Society,

by Stephen Austin & Sons, 5 Fore St., Hertford,
England.
Cage Birds and Bird World. Pub. weekly by F. Carl,
154 Fleet St., London, E. C.
Roller Canary. Pub. monthly at 2144 Sacramento St.,
San Francisco, Calif.
FOOTNOTES:
[4] Addresses of dealers in cage birds and cage-bird supplies

may be obtained on application to the Biological Survey, U. S.
Department of Agriculture.
ORGANIZATION OF THE UNITED STATES DEPARTMENT OF
AGRICULTURE.
Secretary of Agriculture Henry C. Wallace.

Assistant Secretary C. W. Pugsley.
Director of Scientific Work E. D. Ball.
Director of Regulatory Work ——.
Weather Bureau Charles F. Marvin, Chief.
Bureau of Agricultural Economics Henry C. Taylor, Chief.
Bureau of Animal Industry John R. Mohler, Chief.
Bureau of Plant Industry William A. Taylor, Chief.
Forest Service W. B. Greeley, Chief.
Bureau of Chemistry Walter G. Campbell, Acting Chief.
Bureau of Soils Milton Whitney, Chief.
Bureau of Entomology L. O. Howard, Chief.
Bureau of Biological Survey E. W. Nelson, Chief.
Bureau of Public Roads Thomas H. MacDonald, Chief.
Fixed Nitrogen Research
F. G. Cottrell, Director.
Laboratory
Division of Accounts and
A. Zappone, Chief.
Disbursements
Division of Publications Edwin C. Powell, Acting Chief.
Library Claribel R. Barnett, Librarian.
States Relations Service A. C. True, Director.
Federal Horticultural Board C. L. Marlatt, Chairman.
Insecticide and Fungicide Board J. K. Haywood, Chairman.
Packers and Stockyards
Administration Chester Morrill, Assistant to the
Grain Future Trading Act Secretary.
Administration
Office of the Solicitor R. W. Williams, Solicitor.
This bulletin is a contribution from the—

Bureau of Biological Survey E. W. Nelson, Chief.
Division of Food Habits Research W. L. McAtee, in Charge.
ADDITIONAL COPIES
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