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... • The faster the growth of the labor force, the lower will be the economy’s steady-state capital-output ratio – the larger the share of current investment that must go to equip new workers with the capital they need ...
... • The faster the growth of the labor force, the lower will be the economy’s steady-state capital-output ratio – the larger the share of current investment that must go to equip new workers with the capital they need ...
Class Conflict and the Cambridge Theory of
... increase in capitalists’propensity to save shifts the IS left, lowering the equilibrium pro…t rate and rate of capacity utilization. An exogenous decrease in the level of competition increases the mark-up and shifts the M M schedule up. This also lowers the equilibrium pro…t rate and rate of capacit ...
... increase in capitalists’propensity to save shifts the IS left, lowering the equilibrium pro…t rate and rate of capacity utilization. An exogenous decrease in the level of competition increases the mark-up and shifts the M M schedule up. This also lowers the equilibrium pro…t rate and rate of capacit ...
Chapter 8 homework and notes
... 2. The multiplier concept can be demonstrated effectively by a role-playing exercise in which you have students pretend that one row (group) of students are construction workers who benefit from a $1 million increase in investment spending. (Some instructors use an oversized paper $1-million bill.) ...
... 2. The multiplier concept can be demonstrated effectively by a role-playing exercise in which you have students pretend that one row (group) of students are construction workers who benefit from a $1 million increase in investment spending. (Some instructors use an oversized paper $1-million bill.) ...
Investment Hangover and the Great Recessionâ
... asymmetric recovery. Our key observation is that the housing bubble was an investment bubble as much as an asset price bubble. Overbuilding during the bubble years created excess supply of housing capital by 2007, especially certain types of capital such as owner occupied housing. Between 1996 and 2 ...
... asymmetric recovery. Our key observation is that the housing bubble was an investment bubble as much as an asset price bubble. Overbuilding during the bubble years created excess supply of housing capital by 2007, especially certain types of capital such as owner occupied housing. Between 1996 and 2 ...
Review Quiz Answers Econ 103
... United Kingdom) have tended to remain constant. Other Western European nations and the former Communist countries of Central Europe have fallen slightly farther behind the United States. The gap between the United States and most nations in Africa, and Central and South America has widened. But some ...
... United Kingdom) have tended to remain constant. Other Western European nations and the former Communist countries of Central Europe have fallen slightly farther behind the United States. The gap between the United States and most nations in Africa, and Central and South America has widened. But some ...
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... Thus, only when planned investment equals saving will there be equilibrium. FIGURE 8.7 The S = I Approach to Equilibrium ...
... Thus, only when planned investment equals saving will there be equilibrium. FIGURE 8.7 The S = I Approach to Equilibrium ...
Equilibrium Technology Diffusion, Trade, and Growth
... The third comparative static focuses on scale effects. We keep the parameterization of the model the same, but double the number of countries to understand how the scale or size of the economy matters. We show that the relationship between growth and openness is unchanged when we increase the scale ...
... The third comparative static focuses on scale effects. We keep the parameterization of the model the same, but double the number of countries to understand how the scale or size of the economy matters. We show that the relationship between growth and openness is unchanged when we increase the scale ...
Answers to Homework #4
... c. When the economy moves from point E to point C we know from inspection of the graph that labor is not changing and, by our assumption of fixed technology, that technology is not changing. Looking at the graph we see that capital is changing from K to K’ where K’ must be greater than K since at e ...
... c. When the economy moves from point E to point C we know from inspection of the graph that labor is not changing and, by our assumption of fixed technology, that technology is not changing. Looking at the graph we see that capital is changing from K to K’ where K’ must be greater than K since at e ...
riezman ge08 6483674 en
... We assume initially the source country exports the manufactured good to the local country, referred to as the export regime. We then identify under what circumstances the equilibrium switches from the status quo to the outsourcing regime. We show that with a su¢ ciently high initial capital stock, t ...
... We assume initially the source country exports the manufactured good to the local country, referred to as the export regime. We then identify under what circumstances the equilibrium switches from the status quo to the outsourcing regime. We show that with a su¢ ciently high initial capital stock, t ...
research paper series Research Paper 2006/26
... in intermediate goods trade (usually referred to by the term international outsourcing), theoretical explanations have so far predominately focussed on two other sources: technological progress and/or organisational change (see Galor and Moav, 2000; Aghion, Howitt and Violante, 2002; and Egger and G ...
... in intermediate goods trade (usually referred to by the term international outsourcing), theoretical explanations have so far predominately focussed on two other sources: technological progress and/or organisational change (see Galor and Moav, 2000; Aghion, Howitt and Violante, 2002; and Egger and G ...
Household and Firm Behavior in the Macroeconomy: A Further Look
... Households: Consumption and Labor Supply Decisions The Labor Supply Decision Households make consumption and labor supply decisions simultaneously. Consumption cannot be considered separately from labor supply, because it is precisely by selling your labor that you earn income to pay for your consum ...
... Households: Consumption and Labor Supply Decisions The Labor Supply Decision Households make consumption and labor supply decisions simultaneously. Consumption cannot be considered separately from labor supply, because it is precisely by selling your labor that you earn income to pay for your consum ...
Chapter 7
... The GDP Deflator: A Better Measure? In principle, the GDP deflator is not subject to the biases of the CPI because it uses the price change and the public response to those price changes in the basket of goods and services produced in the current year and the preceding year. In practice, the GDP de ...
... The GDP Deflator: A Better Measure? In principle, the GDP deflator is not subject to the biases of the CPI because it uses the price change and the public response to those price changes in the basket of goods and services produced in the current year and the preceding year. In practice, the GDP de ...
Fiscal Policy in an Unemployment Crisis
... output displays constant returns to scale. Thus, as long as firms take prices as given, all factors of production are paid their respective marginal product; profits are zero; and the number of firms is undetermined. Labor, nt , then refers to workers per units of land, where the latter quantity can ...
... output displays constant returns to scale. Thus, as long as firms take prices as given, all factors of production are paid their respective marginal product; profits are zero; and the number of firms is undetermined. Labor, nt , then refers to workers per units of land, where the latter quantity can ...
2 - Economics | Bilkent University
... could produce contraction.2 Hirschman (1949) points out that currency depreciation from an initial trade deficit reduces real national income and may lead to a fall in aggregate demand. Currency depreciation gives with one hand, by lowering export prices, while taking away with the other hand, by ra ...
... could produce contraction.2 Hirschman (1949) points out that currency depreciation from an initial trade deficit reduces real national income and may lead to a fall in aggregate demand. Currency depreciation gives with one hand, by lowering export prices, while taking away with the other hand, by ra ...
Technical Appendix 1 to accompany Working
... computer services companies, and then to carry this figure forwards and backwards using the growth rates of indicator series. For the earlier years, the growth of total billings by the computer services industry was used. Years after 1995 used the growth of the wage bill of full-time programmers, c ...
... computer services companies, and then to carry this figure forwards and backwards using the growth rates of indicator series. For the earlier years, the growth of total billings by the computer services industry was used. Years after 1995 used the growth of the wage bill of full-time programmers, c ...
MEASURING PRODUCTION AND INCOME, Chapter 2
... thereby private investment, aggregate demand and output. 9.1.2B. The small open economy with its own currency. The interest rate is fixed but the exchange rate is flexible. Main lesson: Fiscal policy is less effective in a small open economy. Increased government spending or lower net taxes increase ...
... thereby private investment, aggregate demand and output. 9.1.2B. The small open economy with its own currency. The interest rate is fixed but the exchange rate is flexible. Main lesson: Fiscal policy is less effective in a small open economy. Increased government spending or lower net taxes increase ...
(2011): DELFI: DNB`s Macroeconomic Policy Model of the Netherlands
... The production sector of DELFI consists of profit-maximizing firms that transform the inputs of labour, capital services and energy into final goods. The presence of energy as a separate factor of production is an important feature of the model, allowing producers to react to changes in energy price ...
... The production sector of DELFI consists of profit-maximizing firms that transform the inputs of labour, capital services and energy into final goods. The presence of energy as a separate factor of production is an important feature of the model, allowing producers to react to changes in energy price ...
Productive Government Expenditure and Economic
... the equilibrium growth rate depends on the “number” of household-producers, i. e., there is a scale effect. The latter occurs since individual firm productivity depends on aggregate spending (G = θG Y ). Then, with more firms the externality is more pronounced.5 An interesting question is how the si ...
... the equilibrium growth rate depends on the “number” of household-producers, i. e., there is a scale effect. The latter occurs since individual firm productivity depends on aggregate spending (G = θG Y ). Then, with more firms the externality is more pronounced.5 An interesting question is how the si ...
2006 Prentice Hall Business Publishing Macroeconomics, 4/e
... Note two characteristics of ZZ: Because it’s assumed that the consumption and investment relations in Equation (5.2) are linear, ZZ is, in general, a curve rather than a line. ZZ is drawn flatter than a 45-degree line because it’s assumed that an increase in output leads to a less than one-for-o ...
... Note two characteristics of ZZ: Because it’s assumed that the consumption and investment relations in Equation (5.2) are linear, ZZ is, in general, a curve rather than a line. ZZ is drawn flatter than a 45-degree line because it’s assumed that an increase in output leads to a less than one-for-o ...