Ch27-7e-lecture
... The Basic Idea of the Multiplier An increase in investment (or any other component of autonomous expenditure) increases aggregate expenditure and real GDP. The increase in real GDP leads to an increase in induced expenditure. The increase in induced expenditure leads to a further increase in aggrega ...
... The Basic Idea of the Multiplier An increase in investment (or any other component of autonomous expenditure) increases aggregate expenditure and real GDP. The increase in real GDP leads to an increase in induced expenditure. The increase in induced expenditure leads to a further increase in aggrega ...
Accumulation Regimes, Endogenous Desired
... competitors in the industry. The desired level of excess capacity is an increasing function of the economic profits obtained by established firms; since the bigger is the economic profit, the greater will be the incentive for new firms to enter in the market. This change in the macroeconomic structu ...
... competitors in the industry. The desired level of excess capacity is an increasing function of the economic profits obtained by established firms; since the bigger is the economic profit, the greater will be the incentive for new firms to enter in the market. This change in the macroeconomic structu ...
Why Have Business Cycle Fluctuations Become Less
... volatility is due to the change in the volatility of some other shock, combined with unmeasured changes in factor utilization. We therefore pursue this possibility using the model of Burnside et al. (1996) that features both variable capital and labor utilization. We follow Chari, Kehoe, and McGratt ...
... volatility is due to the change in the volatility of some other shock, combined with unmeasured changes in factor utilization. We therefore pursue this possibility using the model of Burnside et al. (1996) that features both variable capital and labor utilization. We follow Chari, Kehoe, and McGratt ...
This PDF is a selection from an out-of-print volume from... of Economic Research
... that because the deficit is financed by money creation there is inflation. But it also shows that the inflationary impact of a given deficit can differ widely, depending on the financial structure and the growth rate of output. The key points of this relation are the following: The inflation rate is ...
... that because the deficit is financed by money creation there is inflation. But it also shows that the inflationary impact of a given deficit can differ widely, depending on the financial structure and the growth rate of output. The key points of this relation are the following: The inflation rate is ...
“The text was adapted by The Saylor Foundation under the CC BY
... components of aggregate demand). When the price level falls, the real value of wealth increases — it packs more purchasing power. For ex ample, if the price level falls by 25%, then $10,000 of wealth could purchase more goods and services than it would have if the price level had not fallen. An inc ...
... components of aggregate demand). When the price level falls, the real value of wealth increases — it packs more purchasing power. For ex ample, if the price level falls by 25%, then $10,000 of wealth could purchase more goods and services than it would have if the price level had not fallen. An inc ...
Inflation, Its Causes and Cures
... equipment (e.g., in the railroads) entailing waste, slower growth, and lower average real wages are the unavoidable consequences. ...
... equipment (e.g., in the railroads) entailing waste, slower growth, and lower average real wages are the unavoidable consequences. ...
Macroeconomic Effects of Fiscal Policy
... USA, cf. e.g. Barro (2009) and Cogan et al. (2010). This debate has rekindled interest in new, empirical analyses of the effects of fiscal policy. These consist of direct effects, e.g. that an increase in public purchases of goods and services is reflected in higher employment in the firms supplying ...
... USA, cf. e.g. Barro (2009) and Cogan et al. (2010). This debate has rekindled interest in new, empirical analyses of the effects of fiscal policy. These consist of direct effects, e.g. that an increase in public purchases of goods and services is reflected in higher employment in the firms supplying ...
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... product. This industry contains two identical firms (i = 1,2), each managed by a risk-neutral capitalist having no time preference. These firms have a two-period life span. Firms compete by introducing product innovations and by altering the institutional environment in which they operate. To give e ...
... product. This industry contains two identical firms (i = 1,2), each managed by a risk-neutral capitalist having no time preference. These firms have a two-period life span. Firms compete by introducing product innovations and by altering the institutional environment in which they operate. To give e ...
Unemployment
... and others have shown that rising unemployment increases the crime rate, the suicide rate, and causes a decline in healthiness.[1] However, during the Great Depression, when unemployment rates exceeded 20% in many countries, the crime rate did not increase.[citation needed] Because unemployment insu ...
... and others have shown that rising unemployment increases the crime rate, the suicide rate, and causes a decline in healthiness.[1] However, during the Great Depression, when unemployment rates exceeded 20% in many countries, the crime rate did not increase.[citation needed] Because unemployment insu ...
MONETARY POLICY UNDER A NEW KEYNESIAN PERSPECTIVE
... ment and explores issues concerning optimal monetary policy. The introductory chapter sets out the motivation of the thesis and puts it into the framework of the existing literature. Chapter 2 provides a New Keynesian framework to study the interaction among oil price volatility, firms’ pricing beha ...
... ment and explores issues concerning optimal monetary policy. The introductory chapter sets out the motivation of the thesis and puts it into the framework of the existing literature. Chapter 2 provides a New Keynesian framework to study the interaction among oil price volatility, firms’ pricing beha ...
Asymmetric effects of the business cycle on carbon dioxide
... capita, energy intensity, and carbon intensity of energy (Kaya, 1990). There are two main categories of emissions forecasting models: calibrated structural models and reduced-form econometric models. Although modern economic theory tells us that the business cycle drives growth, emissions forecastin ...
... capita, energy intensity, and carbon intensity of energy (Kaya, 1990). There are two main categories of emissions forecasting models: calibrated structural models and reduced-form econometric models. Although modern economic theory tells us that the business cycle drives growth, emissions forecastin ...
PDF - Research Center SAFE
... have been associated on average with mild and short-lived recessions, in many cases with no recession at all. Instead, tax-based adjustments have been followed by prolonged and deep recessions. It is worth emphasizing that these are averages, estimated over several plans: an average of small or zero ...
... have been associated on average with mild and short-lived recessions, in many cases with no recession at all. Instead, tax-based adjustments have been followed by prolonged and deep recessions. It is worth emphasizing that these are averages, estimated over several plans: an average of small or zero ...
HWPS#2
... a. A wave of immigration increases the labor force b. An earthquake destroys some of the capital stock c. A technological advance improves the production function d. High inflation doubles the prices of all factors and outputs in the economy The neo-classical (marginal productivity) theory of distri ...
... a. A wave of immigration increases the labor force b. An earthquake destroys some of the capital stock c. A technological advance improves the production function d. High inflation doubles the prices of all factors and outputs in the economy The neo-classical (marginal productivity) theory of distri ...
Long-run Unemployment and Macroeconomic Volatility
... The Classical Dichotomy between real and nominal sides of the economy has been challenged by several contributions, which conversely argue that the two dynamics are not necessary independent in the long-run. Starting with Tobin (1972), a huge strand of literature has stressed in particular on the lo ...
... The Classical Dichotomy between real and nominal sides of the economy has been challenged by several contributions, which conversely argue that the two dynamics are not necessary independent in the long-run. Starting with Tobin (1972), a huge strand of literature has stressed in particular on the lo ...
In‡ation Targeting: Is the NKM …t for purpose? Peter N. Smith and
... whether households hold net assets or net liabilities. Following an increase in the current interest rate, consumption will only decrease if households hold net liabilities. In our view this seriously undermines the usefulness of the NKM. The aim of monetary policy is to return in‡ation to its targe ...
... whether households hold net assets or net liabilities. Following an increase in the current interest rate, consumption will only decrease if households hold net liabilities. In our view this seriously undermines the usefulness of the NKM. The aim of monetary policy is to return in‡ation to its targe ...
The Macroeconomic Implications of Credit Rating Shocks in
... methods to identify macroeconomic shocks from a methodological one. The literature about the effect of rating announcements, that has experienced a notable growth in conjunction with the Asian crisis of the late 1990s, can be ideally divided into two strands. The first focuses on the effect that rat ...
... methods to identify macroeconomic shocks from a methodological one. The literature about the effect of rating announcements, that has experienced a notable growth in conjunction with the Asian crisis of the late 1990s, can be ideally divided into two strands. The first focuses on the effect that rat ...
Economics 101 Assignment #3 (20 Points) Name
... of $200,000 at 6% interest with 25 years left to be paid. The annual interest payment is $12,000 (6% of $200,000). Of this, the taxes are reduced by $3,000 (25% of $12,000). Thus, the actual cost to the borrower is not $12,000, but $9,000 ($12,000 - $3,000). Some people have proposed that the mortga ...
... of $200,000 at 6% interest with 25 years left to be paid. The annual interest payment is $12,000 (6% of $200,000). Of this, the taxes are reduced by $3,000 (25% of $12,000). Thus, the actual cost to the borrower is not $12,000, but $9,000 ($12,000 - $3,000). Some people have proposed that the mortga ...
An Input-Output Sticky-price Model
... input-output method has an unparalleled advantage in measuring total impact of changes in final demand on employment. Li Yining(2001) proposed the theoretical framework using input-output model to analyze the ability to absorb employment of each industry and did some empirical analysis on Chinese in ...
... input-output method has an unparalleled advantage in measuring total impact of changes in final demand on employment. Li Yining(2001) proposed the theoretical framework using input-output model to analyze the ability to absorb employment of each industry and did some empirical analysis on Chinese in ...