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Social Conflict and the Effectiveness of Aggregate Demand
Social Conflict and the Effectiveness of Aggregate Demand

... methodology, and terminology, but, as I hope to show, there comes out from this work a remarkably coherent account of why macroeconomic imbalances were largely absent during the 1950s and 1960s (that is, the period that has come to be known as the “golden age” of capitalism),1 and why this ceased to ...
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... 1982) convinced many macroeconomists that monetary shocks could not account for business cycles. If money were neutral in the long-run it could not induce permanent changes in real variables. Yet real output was, in fact, dominated by a non-stationary component, suggesting that real rather than mone ...
Unit V - KV Institute of Management and Information Studies
Unit V - KV Institute of Management and Information Studies

... 9)Social and Cultural Factors: It has generally been seen that people do not want to leave their family and work at distant places. In a joint family, individuals have a tendency to neglect work as they want to spend their life on the income of other family members. Measures to Reduce Unemployment M ...
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... So do practitioners in the financial markets. Such models were originally designed to answer questions about policy rules. The rational expectations assumption brought attention to the importance of consistency over time and to predictability, whether about inflation or policy rule responses, and to ...
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Chapter 7 Aggregate Demand and Aggregate Supply

... relationship between price and quantity demanded in individual markets. First, a lower price induces people to substitute more of the good whose price has fallen for other goods, increasing the quantity demanded. Second, the lower price creates a higher real income. This normally increases quantity ...
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PDF

... An increase in the ratio of non-government spending to GDP is the same as a fall in government spending, shown by the dashed line. If the point A represents full-employment, then under a fixed rate regime (the norm for many poor countries) the economy will end up at A in the final equilibrium.10 In ...
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Advanced Macroeconomics - Juridica – Kolegji Evropian

... degree. Macroeconomics is a very practical subject and can be very useful for policy making. Domestic and international economies are subjected to variations in savings, income, exchange rates, as well as interest rates and the balance of payments. This book attempts to explain the domestic and inte ...
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... The American public’s appetite for an activist government varies over time, and that variation is both substantial and systematic. We saw it in calls to shrink government across the board and cut taxes in the early 1980s, and to invest in the future by funding education and overhauling health care f ...
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Chapter 11: The Money Market and the LM Curve Copyright MHHE

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Review Quiz Answers Econ 103

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File - Georgia Test Practice

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... Fiscal relations affect the behaviour of firms, households and governments and thereby economic activity. Firms’ investment decisions are affected by the productivity of the public sector, and differences between costs and benefits of service provision across jurisdictions may induce them to change ...
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One of the major claims of mainstream economics is that liberalization... process of economic growth that is characterized by the reduction of... Emerging income inequality and widening economic divide: The case of Sri

... ratios reflect almost the same pattern of variation in which income distribution has effectively concentrated among the top income segments of the population. Thus there has been an apparent shift of income share from the poorer groups of the population towards the richer groups. All four measures h ...
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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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