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Chapter 12
Chapter 12

... Central Bank Independence • Countries with Central Banks (the general name for institutions like the US Federal Reserve) that are more independent of political control have higher rates of economic growth. • This is because political influences tend to create inflationary tendencies which raises in ...
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14.02 Quiz 1 Solution
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... that the interest rate and GDP are the same in section 4 and 6, however the constant in the investment equation is lower in section 6, then it must be that the investment is section 6 is lower than in section 4. Here government investment replaces private investment. A monetary expansion: by inspect ...
This PDF is a selection from a published volume from... Research Volume Title: International Dimensions of Monetary Policy
This PDF is a selection from a published volume from... Research Volume Title: International Dimensions of Monetary Policy

... shock, using two different elasticities of substitution between domestic and imported goods (i.e., 5 and 1.5) in the model by Adolfson et al. (2008b). In contrast to SIGMA, this model does not contain trade adjustment costs so the difference between the open and closed economy responses are somewhat l ...
IV. The Debate Over Market Socialism
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... When the Great Crash of 1929 turned into the Great Depression of the 1930s, the remaining voices for laissez-faire were silenced. Economists who had held the classical position were either ignored or they changed their song to be more in tune with the times. Government had to do something to address ...
CHAPTER - 7 STAGFLATION
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... Keynesian economics, which dominated academic macro economics in the 1960's demonstrated to the Congress of U.S.A. and the public,, its ability to eliminate the gap between potential and actual output. ...
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... do not change when demand falls, and a recession occurs. Companies do not have much incentive to reduce their prices when the demand for their goods is lower, as their decisions have externalities. As Blanchard and Kiyotaki (1987) suggest, the aggregate demand externality indicates that the decision ...
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Business cycle

The business cycle or economic cycle is the downward and upward movement of gross domestic product (GDP) around its long-term growth trend. These fluctuations typically involve shifts over time between periods of relatively rapid economic growth (expansions or booms), and periods of relative stagnation or decline (contractions or recessions).Used in the indefinite sense, a business cycle is a period of time containing a single boom and contraction in sequence.Business cycles are usually measured by considering the growth rate of real gross domestic product. Despite being termed cycles, these fluctuations in economic activity can prove unpredictable.A boom-and-bust cycle is one in which the expansions are rapid and the contractions are steep and severe.
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