Current Issues
... policy by the Fed keeps jerking on it, causing the car (the macroeconomy) to swerve. If the Fed would just hold the steering wheel steady, the macroeconomy would be stable. LAST WORD: The Taylor Rule: Could a Robot Replace Alan Greenspan? A. Macroeconomist John Taylor of Stanford University calls fo ...
... policy by the Fed keeps jerking on it, causing the car (the macroeconomy) to swerve. If the Fed would just hold the steering wheel steady, the macroeconomy would be stable. LAST WORD: The Taylor Rule: Could a Robot Replace Alan Greenspan? A. Macroeconomist John Taylor of Stanford University calls fo ...
How the Intelligent Non-Economist can Refute Every Economist
... ever before. How is it, then, that in all these years, and with all the undoubted talent that has been lavished upon it, the subject of economics has advanced so little? (Schoeffler, 1955, p. 2) The answer is that the representative economist does not understand the pivotal phenomenon of his subject ...
... ever before. How is it, then, that in all these years, and with all the undoubted talent that has been lavished upon it, the subject of economics has advanced so little? (Schoeffler, 1955, p. 2) The answer is that the representative economist does not understand the pivotal phenomenon of his subject ...
Chap02
... • The average of the short term one year rates is 7%, but the three year rate is only 5%. • One could borrow any given amount such as $1000 for the full three years and invest that money one year at a time and rolling over the investment for three years. • The borrowing cost per year is 5% and the a ...
... • The average of the short term one year rates is 7%, but the three year rate is only 5%. • One could borrow any given amount such as $1000 for the full three years and invest that money one year at a time and rolling over the investment for three years. • The borrowing cost per year is 5% and the a ...
A Perspective on Modern Business Cycle Theory
... where δ is the depreciation rate of capital. Here, we assume that markets are complete, that is, there exists a complete set of Arrow securities so that state-contingent claims to goods and factors of production for every possible future state can be traded at the initial period. We also assume that ...
... where δ is the depreciation rate of capital. Here, we assume that markets are complete, that is, there exists a complete set of Arrow securities so that state-contingent claims to goods and factors of production for every possible future state can be traded at the initial period. We also assume that ...
Aggregate Demand Theories of the Business Cycle
... A higher interest rate shifts the AD curve leftward. ...
... A higher interest rate shifts the AD curve leftward. ...
Module Money, Output, and Prices in the Long Run
... • In the short run, real GDP would increase, but so would the aggregate price level. • Eventually nominal wages would rise in labor markets, shifting SRAS to the left. • Long-run equilibrium would be established back at potential GDP and at a higher price level. ...
... • In the short run, real GDP would increase, but so would the aggregate price level. • Eventually nominal wages would rise in labor markets, shifting SRAS to the left. • Long-run equilibrium would be established back at potential GDP and at a higher price level. ...
The Pied Piper Wore a Suit and Tie
... well” (Levi, 120). Further issues resulted from the nationalization of industry. Economists wondered, “Shall a nationalized industry be operated for commercial ends- that is, receipts that cover costs- or shall its operations be directed to serve broad economic and social needs” (Loucks, 216). Keyne ...
... well” (Levi, 120). Further issues resulted from the nationalization of industry. Economists wondered, “Shall a nationalized industry be operated for commercial ends- that is, receipts that cover costs- or shall its operations be directed to serve broad economic and social needs” (Loucks, 216). Keyne ...
macro review - WordPress.com
... • The higher the withdrawals (taxes, imports and savings), the …………the multiplicative effect of any given increase in government spending. • Lower interest rates will ……………………….. • lower income taxes will ……………………………. • Removal of trade barriers to imports will…………………….. • All will change the MPW an ...
... • The higher the withdrawals (taxes, imports and savings), the …………the multiplicative effect of any given increase in government spending. • Lower interest rates will ……………………….. • lower income taxes will ……………………………. • Removal of trade barriers to imports will…………………….. • All will change the MPW an ...
File
... ○ Critics arge that because of the lag, the Fed should not try to fine tune the economy ○ They argue that the Fed reacts too late to changing economic conditions ■ These critics advocate for passive monetary policy ● In the United States, most changes in government spending and taxes must go th ...
... ○ Critics arge that because of the lag, the Fed should not try to fine tune the economy ○ They argue that the Fed reacts too late to changing economic conditions ■ These critics advocate for passive monetary policy ● In the United States, most changes in government spending and taxes must go th ...
Module Saving, Investment, and the Financial System
... You lend out $100 with 20% interest. Inflation is 15%. A year later you get paid back $120. What is the nominal and what is the real interest rate? Nominal interest rate is 20%. Real interest rate was 5% In reality, you get paid back an amount with less purchasing power. ...
... You lend out $100 with 20% interest. Inflation is 15%. A year later you get paid back $120. What is the nominal and what is the real interest rate? Nominal interest rate is 20%. Real interest rate was 5% In reality, you get paid back an amount with less purchasing power. ...
Why Business Cycles?
... The End of the Depression • Massive government spending during World War II added a huge stimulant to the economy for most of the early 1940s • Recession returned in 1945, but it did not last • As soon as the war was over, consumers went on a buying binge that stimulated expansion again • Since 196 ...
... The End of the Depression • Massive government spending during World War II added a huge stimulant to the economy for most of the early 1940s • Recession returned in 1945, but it did not last • As soon as the war was over, consumers went on a buying binge that stimulated expansion again • Since 196 ...
presentation
... Prevent unsustainable booms and leverage buildup Increase resilience to busts ...
... Prevent unsustainable booms and leverage buildup Increase resilience to busts ...
A Few Thoughts on the Employment Numbers
... do the least in terms of lowering rates (they are already low!), so also likely to do the least damage. Mohammed El-Erian thinks that if nothing happens the Fed will be forced to continue, which is a dangerous thing. I wonder whether they might just shrug their shoulders and say, “We tried, and now ...
... do the least in terms of lowering rates (they are already low!), so also likely to do the least damage. Mohammed El-Erian thinks that if nothing happens the Fed will be forced to continue, which is a dangerous thing. I wonder whether they might just shrug their shoulders and say, “We tried, and now ...
Lecture 9. Chapter 10 - Henry W. Chappell Jr.
... responses to shocks, and require no intervention from government to improve matters (again consider the Robinson Crusoe analogy). We see that added government spending can increase GDP, but even in a recession it would be inadvisable to increase spending for the purpose of ...
... responses to shocks, and require no intervention from government to improve matters (again consider the Robinson Crusoe analogy). We see that added government spending can increase GDP, but even in a recession it would be inadvisable to increase spending for the purpose of ...
PowerPoint Slides 1
... investment will eventually lead to more than a threefold increase (decrease) in income; note that it takes time for the multiplier to work. • The critical value in this computation is MPC. Thus, a quantitative estimate of MPC provides valuable information for policy purposes. Knowing MPC, one can pr ...
... investment will eventually lead to more than a threefold increase (decrease) in income; note that it takes time for the multiplier to work. • The critical value in this computation is MPC. Thus, a quantitative estimate of MPC provides valuable information for policy purposes. Knowing MPC, one can pr ...
INVESTMENT, FINANCIAL INTERMEDIATION & FINANCIAL
... (struggling) saving and loan industry by reducing regulations • Many investment projects collapsed and the government was forced to bail out many savings and loans at a cost of nearly $100 billion to the U.S. economy ...
... (struggling) saving and loan industry by reducing regulations • Many investment projects collapsed and the government was forced to bail out many savings and loans at a cost of nearly $100 billion to the U.S. economy ...
Interest Rates on Debt Securities
... Lower federal funds rates lead to lower rates on all bank lending, causing spending to increase ...
... Lower federal funds rates lead to lower rates on all bank lending, causing spending to increase ...
a sample - Are you covered?
... c. disruptive (of trade, resource availability, labour management). ...
... c. disruptive (of trade, resource availability, labour management). ...
Economics: Today and Tomorrow
... unemployment rate is around 5%. • Unemployment rates are an estimate; survey results are also imperfect because of the underground economy such as tax evaders and drug traffickers. ...
... unemployment rate is around 5%. • Unemployment rates are an estimate; survey results are also imperfect because of the underground economy such as tax evaders and drug traffickers. ...
The Great Recession: A Macroeconomic Earthquake
... of the economy to a negative shock to the demand for goods all across the board. This is very much in the spirit of the traditional macroeconomic paradigm captured by the famous IS-LM (or Hicks-Hansen) model,9 which places demand shocks like this at the heart of its theory of business cycle fluctuat ...
... of the economy to a negative shock to the demand for goods all across the board. This is very much in the spirit of the traditional macroeconomic paradigm captured by the famous IS-LM (or Hicks-Hansen) model,9 which places demand shocks like this at the heart of its theory of business cycle fluctuat ...
capital theory, inflation and deflation: the austrians and monetary
... Specifically, it would analyze how disequilibria in the money and time markets can affect the array of relative prices, including intertemporal ones, throughout the economy, and see if any systematic patterns of error result. In addition, a coordination-based macroeconomics would need to take explic ...
... Specifically, it would analyze how disequilibria in the money and time markets can affect the array of relative prices, including intertemporal ones, throughout the economy, and see if any systematic patterns of error result. In addition, a coordination-based macroeconomics would need to take explic ...