Notes 11: Examples of Fiscal Policy
... G, decreases the IS curve (and the AD curve – they are both the same – just drawn in different spaces) will fall. This causes interest rates to fall (as does output). A lower level of output will decrease the demand for money (we need less money in the economy because there is less stuff to buy). Th ...
... G, decreases the IS curve (and the AD curve – they are both the same – just drawn in different spaces) will fall. This causes interest rates to fall (as does output). A lower level of output will decrease the demand for money (we need less money in the economy because there is less stuff to buy). Th ...
The role of Monetary Policy in Post-Keynesian Stock-Flow
... (in the simple case in which their previous stock of money deposits was zero). Households then spend their money buying goods produced by firms (during the period), so their deposits decrease along with the outstanding debt of firms, which use the money to reimburse at least part of the initial loan ...
... (in the simple case in which their previous stock of money deposits was zero). Households then spend their money buying goods produced by firms (during the period), so their deposits decrease along with the outstanding debt of firms, which use the money to reimburse at least part of the initial loan ...
Demand effects of financialisation and changes in functional income
... Let us now turn to the empirical picture. Stockhammer et al. (2011), Onaran and Galanis (2014) and Onaran and Obst (2015) provide evidence that the Euro area overall is in a wage-led demand regime.3 Individual European countries, in particular ones with small open economies may be profitled, because ...
... Let us now turn to the empirical picture. Stockhammer et al. (2011), Onaran and Galanis (2014) and Onaran and Obst (2015) provide evidence that the Euro area overall is in a wage-led demand regime.3 Individual European countries, in particular ones with small open economies may be profitled, because ...
Dynamics of the Mixed Economy
... part of its present and future income. Only if the private sector income rises proportionally faster than the national debt and tax burden, and only if it owes this rise to the "pump-priming" activ ities of government, can it be said that government-induced produc tion serves private capital as we ...
... part of its present and future income. Only if the private sector income rises proportionally faster than the national debt and tax burden, and only if it owes this rise to the "pump-priming" activ ities of government, can it be said that government-induced produc tion serves private capital as we ...
Welfare Economics Economic Systems Pareto Optimality General
... At least one person prefers his/her individual allocation in A Everyone else is indi¤erent between what he/she receives in A and B 2. We say that an allocation A is Pareto-Optimal if there is no feasible and Pareto-Preferred alternative allocation to it. Equivalently: ...
... At least one person prefers his/her individual allocation in A Everyone else is indi¤erent between what he/she receives in A and B 2. We say that an allocation A is Pareto-Optimal if there is no feasible and Pareto-Preferred alternative allocation to it. Equivalently: ...
economics notes
... * planned & actual, demand & supply = firms plan to maximise their profits but if customers don't demand, actual output is different! The concept of spare capacity makes the firm responsive in the short term. DEMAND FOR CONSUMER GOODS. * consumption function = depends on how much money people have & ...
... * planned & actual, demand & supply = firms plan to maximise their profits but if customers don't demand, actual output is different! The concept of spare capacity makes the firm responsive in the short term. DEMAND FOR CONSUMER GOODS. * consumption function = depends on how much money people have & ...
Grad8
... consumption levels in economies where people exhibit a higher propensity to consume are potentially more volatile. To be more precise, we can say that a higher marginal propensity to consume makes employment, output, and consumption more sensitive to autonomous changes is spending. To conclude this ...
... consumption levels in economies where people exhibit a higher propensity to consume are potentially more volatile. To be more precise, we can say that a higher marginal propensity to consume makes employment, output, and consumption more sensitive to autonomous changes is spending. To conclude this ...
Quantity Demanded
... factor markets. Through trade, households and businesses exchange what they have in surplus (often gained through the efficiency of specialization) and trade for the resources that they need. Combined together, these interactions determine what goods and services will be produced, how, and for whom. ...
... factor markets. Through trade, households and businesses exchange what they have in surplus (often gained through the efficiency of specialization) and trade for the resources that they need. Combined together, these interactions determine what goods and services will be produced, how, and for whom. ...
The Income-Expenditure Model
... • The Income-Expenditure model, also known as the Keynesian Cross model, was first developed by the Depression-era economist named John Keynes. • The goal was to develop a model that could explain how an economy could become permanently “stuck” at a high-unemployment level. ...
... • The Income-Expenditure model, also known as the Keynesian Cross model, was first developed by the Depression-era economist named John Keynes. • The goal was to develop a model that could explain how an economy could become permanently “stuck” at a high-unemployment level. ...
Optimal Monetary Policy in a Two Country Model with Firm
... terms of trade and reducing the monetary distortion which depends on the size of the monopoly distortion. The terms of trade channel just described generates one conflict of interest between the two countries. However, this conflict is not the only basis for policy competition because monetary policy ...
... terms of trade and reducing the monetary distortion which depends on the size of the monopoly distortion. The terms of trade channel just described generates one conflict of interest between the two countries. However, this conflict is not the only basis for policy competition because monetary policy ...
How Solid Is Economic Growth in the East African Community?
... Prediction is very difficult, especially if it’s about the future, as physicist Nils Bohr famously remarked. The economics profession’s ability to forecast economic growth beyond the next year or so is particularly weak; and it is abysmal at forecasting turning points in the economic cycle (Loungani ...
... Prediction is very difficult, especially if it’s about the future, as physicist Nils Bohr famously remarked. The economics profession’s ability to forecast economic growth beyond the next year or so is particularly weak; and it is abysmal at forecasting turning points in the economic cycle (Loungani ...
mancosa internationa..
... Government policy is often shaped by a consideration of the costs and benefits of FDI Resource transfer effects - FDI can make a positive contribution towards a host economy by supplying capital, technology, and management resources ...
... Government policy is often shaped by a consideration of the costs and benefits of FDI Resource transfer effects - FDI can make a positive contribution towards a host economy by supplying capital, technology, and management resources ...
Saving
... downward). • This is the case since people save to accumulate wealth. • As wealth increases, no need to save as much as before. • This is called “wealth effect”. ...
... downward). • This is the case since people save to accumulate wealth. • As wealth increases, no need to save as much as before. • This is called “wealth effect”. ...
Outline of Lecture 1 – Basic Economics Concepts
... Definition of theory of liquidity preference: Keynes’s theory that the interest rate adjusts to bring money supply and money demand into balance. Teaching advice ...
... Definition of theory of liquidity preference: Keynes’s theory that the interest rate adjusts to bring money supply and money demand into balance. Teaching advice ...
Session 9 GDP and Growth - Federal Reserve Bank of Dallas
... Macroeconomics • Big picture not individual decisions • Think about… – Consumer expenditures, not Coke vs. Pepsi – Prices of all goods, rather than a single item ...
... Macroeconomics • Big picture not individual decisions • Think about… – Consumer expenditures, not Coke vs. Pepsi – Prices of all goods, rather than a single item ...
Getting interventions right: how South Korea and Taiwan grew rich
... once the bias against manufacturing for export was removed. The high profitability also depended on a relatively well-educated hard working docile labour force which was, apart from the natural rate of increase, fed by a large movement out of agriculture High profits and increased earnings for recru ...
... once the bias against manufacturing for export was removed. The high profitability also depended on a relatively well-educated hard working docile labour force which was, apart from the natural rate of increase, fed by a large movement out of agriculture High profits and increased earnings for recru ...
Chapter 3: THE ECONOMIC OUTLOOK
... The Treasury estimates the trend growth rate of potential output by using a wide range of survey and other information to estimate points in time at which there was no upward or downward pressure on inflation, and when actual output must therefore have been equal to potential output. Over past econo ...
... The Treasury estimates the trend growth rate of potential output by using a wide range of survey and other information to estimate points in time at which there was no upward or downward pressure on inflation, and when actual output must therefore have been equal to potential output. Over past econo ...
Ch20 Economic Growth Multiple Choice Questions 1. During the last
... Explanation: A first argument is based on diminishing marginal returns. Even though deepening human and physical capital will tend to increase per capita GDP, the law of diminishing returns suggests that as an economy continues to increase its human and physical capital, the marginal gains to econom ...
... Explanation: A first argument is based on diminishing marginal returns. Even though deepening human and physical capital will tend to increase per capita GDP, the law of diminishing returns suggests that as an economy continues to increase its human and physical capital, the marginal gains to econom ...
THE KEYNESIAN CROSS Preliminaries Macro Dynamics Aggregate
... - an increase in consumer confidence (raises C0) - a stock market or real estate bubble (raises consumer wealth, thus C0) - tax rebate/autonomous cut/rise in exemption (fall in TX0) - introduction of a new government transfer program (TR, can be positive or negative - increase in government spending ...
... - an increase in consumer confidence (raises C0) - a stock market or real estate bubble (raises consumer wealth, thus C0) - tax rebate/autonomous cut/rise in exemption (fall in TX0) - introduction of a new government transfer program (TR, can be positive or negative - increase in government spending ...
E-commerce
... We must aim for a precise definition of e-commerce in order to conduct identical measurements in all countries. This will allow us to make international comparisons of satisfactory quality. The Canadian example shows that statisticians can quantify e-commerce. The OECD’s work should be concluded qui ...
... We must aim for a precise definition of e-commerce in order to conduct identical measurements in all countries. This will allow us to make international comparisons of satisfactory quality. The Canadian example shows that statisticians can quantify e-commerce. The OECD’s work should be concluded qui ...
lseGC_pessoa_performance
... outperformed only by Germany. Although data from the most recent years is likely to be revised, even if the UK’s 2008-2011 growth was much worse than recorded, it’s relative position over the entire post 1997 period is unlikely to dramatically change (other countries will also have their data revise ...
... outperformed only by Germany. Although data from the most recent years is likely to be revised, even if the UK’s 2008-2011 growth was much worse than recorded, it’s relative position over the entire post 1997 period is unlikely to dramatically change (other countries will also have their data revise ...
ECN 4861 Word Document (Fall 2001)
... (opposite of flow approach - which depends on relative prices) Let i rise (Hold all else constant!): results in an decrease in domestic money demand, which results in e - depreciation Results are diametrically opposed to flow approach - where capital flow is emphasized by r capital flow in D$ ...
... (opposite of flow approach - which depends on relative prices) Let i rise (Hold all else constant!): results in an decrease in domestic money demand, which results in e - depreciation Results are diametrically opposed to flow approach - where capital flow is emphasized by r capital flow in D$ ...
Ragnar Nurkse's balanced growth theory
The balanced growth theory is an economic theory pioneered by the economist Ragnar Nurkse (1907–1959). The theory hypothesises that the government of any underdeveloped country needs to make large investments in a number of industries simultaneously. This will enlarge the market size, increase productivity, and provide an incentive for the private sector to invest.Nurkse was in favour of attaining balanced growth in both the industrial and agricultural sectors of the economy. He recognised that the expansion and inter-sectoral balance between agriculture and manufacturing is necessary so that each of these sectors provides a market for the products of the other and in turn, supplies the necessary raw materials for the development and growth of the other.Nurkse and Paul Rosenstein-Rodan were the pioneers of balanced growth theory and much of how it is understood today dates back to their work.Nurkse's theory discusses how the poor size of the market in underdeveloped countries perpetuates its underdeveloped state. Nurkse has also clarified the various determinants of the market size and puts primary focus on productivity. According to him, if the productivity levels rise in a less developed country, its market size will expand and thus it can eventually become a developed economy. Apart from this, Nurkse has been nicknamed an export pessimist, as he feels that the finances to make investments in underdeveloped countries must arise from their own domestic territory. No importance should be given to promoting exports.