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Fiscal consolidation
Fiscal consolidation

“The text was adapted by The Saylor Foundation under the CC BY
“The text was adapted by The Saylor Foundation under the CC BY

Economic Report of the President - The American Presidency Project
Economic Report of the President - The American Presidency Project

... security. Social Security and Medicare are more important than ever, and we shouldn’t weaken them; we should strengthen them. For Americans short of retirement, basic benefits should be just as mobile as everything else is today. That’s part of what the Affordable Care Act is all about. It helps fil ...
Chapter 7 Aggregate Demand, Aggregate Supply, and the Self
Chapter 7 Aggregate Demand, Aggregate Supply, and the Self

... A) fall to E1 causing output to rise and unemployment would be temporary. B) rise to E0 causing output to rise and unemployment would be temporary. C) rise to A causing output to fall and unemployment would be temporary. D) fall to A causing output to fall and unemployment would be permanently incre ...
Accumulation Regimes, Endogenous Desired
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Module 19 Equilibrium in the Aggregate Demand
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... a great deal of pain because it corresponds to high unemployment. The large recessionary gap that had opened up in the United States by 1933 caused intense social and political turmoil. And the devastating recessionary gap that opened up in Germany at the same time played an important role in Hitler ...
Chapter 11 - Pearson Canada
Chapter 11 - Pearson Canada

... households and firms decide to respond to price changes than we have used to this point. In Chapters 9 and 10 we used a simple description of this decision on the part of firms; for a period of time, firms will passively expand or contract output without changing prices but will eventually respond b ...
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... herd instinct (animal spirits) are the major factor changing aggregate demand. 23. b Classical economists assert that the money age rate adjusts so that real GDP always equals potential GDP. 24. c Monetarists trace recessions to abrupt slowdowns in the growth rate of the quantity of money. „ Answers ...
Government transfer payments and regional development
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NATIONAL BANK OF POLAND WORKING PAPER No. 135
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... of money in monetary policy analyses. There is no consensus as to whether the There are many similar works (theoretical and empirical) indicating the importance of money as an argument of the central bank reaction function in a world of incomplete information. For example, in the work of Berg et al. ...
Foreign Capital Flows and Defense Expenditures: Looney, R.E.
Foreign Capital Flows and Defense Expenditures: Looney, R.E.

... from abroad. Here, the conventional wisdom is that whatever choice is made, the country is likely to experience lower current consumption and lower future rates of growth, with the exact mix ·depending on how the expenditures are financed. Clearly, on the one hand, external financing of defence expe ...
2016-2019 Stability Programme
2016-2019 Stability Programme

... Growth should level out in the US in the wake of the hike in interest rates. In the UK, growth should be stable in 2016-2017 compared to 2015, and is slated to remain above its potential. In Japan, the economic recovery should pick up speed in 2016 but level off in early 2017, due to the rise in VAT ...
Stability Programme - European Commission
Stability Programme - European Commission

... Growth should level out in the US in the wake of the hike in interest rates. In the UK, growth should be stable in 2016-2017 compared to 2015, and is slated to remain above its potential. In Japan, the economic recovery should pick up speed in 2016 but level off in early 2017, due to the rise in VAT ...
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trade and development report, 2011

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Principles of Macroeconomics Self-study quiz and Exercises with

... 1) To get the economy out of a slump, Keynes believed that the government should A) cut both taxes and government spending. B) increase both taxes and government spending. C) increase taxes and/or decrease government spending. D) decrease taxes and/or increase government spending. Answer: D 2) To br ...
the evolution of economic understanding
the evolution of economic understanding

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The Evolution of Economic Understanding and Postwar Stabilization Policy Christina D. Romer

... dramatically. There has been, as our title suggests, an evolution of economic understanding. However, the evolution of economic understanding that has occurred is not one of linear progression from less knowledge to more. Rather, it is a more interesting evolution from a crude but fundamentally sens ...
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... augmenting standard VAR models with measures of new …rm incorporations and net business formation. Second, we build a stylized sticky price model of monetary policy when …rm entry is endogenous. Firms must prepay a (possibly time-varying) …xed cost in the period prior to production, which is the cos ...
Changing Income Inequality in the Second Half of the 20th Century
Changing Income Inequality in the Second Half of the 20th Century

... between 1967 and 1975 and increase after 1975. Outside the Core Countries From the mentioned Deininger and Squire data set we can also add information for a few developing countries. For India we observe a decrease of inequality since the early 1950s until about 1970 and an increase after 1970. Sri ...
9708 ECONOMICS www.maxpapers.com
9708 ECONOMICS www.maxpapers.com

... fixed exchange rate system. Deflation refers to a persistent fall in the general price level or a lower level of economic activity possibly resulting from government policy. Devaluation should improve the current account and boost the economy with higher demand, employment and growth. Deflation harm ...
Secular Stagnation: the History of a Macroeconomic Heresy
Secular Stagnation: the History of a Macroeconomic Heresy

... population growth was declining and that this would lead to a large fall in investment unless there was a rise in technical progress. “We are,” he argued, “rapidly entering a world in which we must fall back upon a more rapid advance of technology than in the past if we are to find private investmen ...
CHAPTER IX THEORIES OP INFLATION There are seven important
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... in real terms, are assumed to be bearing a constant ratio to real output y, and hence the money value of the supply of consumer goods represented by Y - (G+I) is increased by the rise in the price level and thereby the demand for consumer goods and the supply of consumer goods are made equal to each ...
A Probabilistic Approach to Fiscal Space and Prudent Debt Level
A Probabilistic Approach to Fiscal Space and Prudent Debt Level

... In this paper, we define a country’s fiscal space as the difference between a prudent debt level and the actual public debt to GDP ratio.6 It should be noted that this paper focuses on public debt level and the desirable buffer with respect to a given debt ceiling (one element of fiscal space), abst ...
Aggregate Demand and Aggregate Supply
Aggregate Demand and Aggregate Supply

... A fall in the price level from P1 to P2 increases the quantity of goods and services demanded from Y1 to Y2. There are three reasons for this negative relationship. As the price level falls, real wealth rises, interest rates fall, and the exchange rate depreciates. These effects stimulate spending o ...
Monetary Policy - Macmillan Learning
Monetary Policy - Macmillan Learning

... short-term interest rates. As a comparison of the two Source: Federal Reserve Bank of St. Louis. columns of Table 15-2 shows, the opportunity cost of holding money fell. The last two rows of Table 15-2 summarize this comparison: they give the differences between the interest rates on demand deposits ...
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Fiscal multiplier

In economics, the fiscal multiplier (not to be confused with monetary multiplier) is the ratio of a change in national income to the change in government spending that causes it. More generally, the exogenous spending multiplier is the ratio of a change in national income to any autonomous change in spending (private investment spending, consumer spending, government spending, or spending by foreigners on the country's exports) that causes it. When this multiplier exceeds one, the enhanced effect on national income is called the multiplier effect. The mechanism that can give rise to a multiplier effect is that an initial incremental amount of spending can lead to increased consumption spending, increasing income further and hence further increasing consumption, etc., resulting in an overall increase in national income greater than the initial incremental amount of spending. In other words, an initial change in aggregate demand may cause a change in aggregate output (and hence the aggregate income that it generates) that is a multiple of the initial change.The existence of a multiplier effect was initially proposed by Keynes student Richard Kahn in 1930 and published in 1931. Some other schools of economic thought reject or downplay the importance of multiplier effects, particularly in terms of the long run. The multiplier effect has been used as an argument for the efficacy of government spending or taxation relief to stimulate aggregate demand.In certain cases multiplier values less than one have been empirically measured (an example is sports stadiums), suggesting that certain types of government spending crowd out private investment or consumer spending that would have otherwise taken place. This crowding out can occur because the initial increase in spending may cause an increase in interest rates or in the price level. In 2009, The Economist magazine noted ""economists are in fact deeply divided about how well, or indeed whether, such stimulus works"", partly because of a lack of empirical data from non-military based stimulus. New evidence came from the American Recovery and Reinvestment Act of 2009, whose benefits were projected based on fiscal multipliers and which was in fact followed - from 2010 to 2012 - by a slowing of job loss and private sector job growth.
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