Answers to Practice Problems 2005
... from Nod, but the overall result will still be a fall in Nod imports. In GDI, since we have a fixed exchange rate, interest rates must be kept constant, so the LM curve will shift right along with the IS curve to LM’, as the reserve bank moves to prevent the domestic interest rate from rising. Outpu ...
... from Nod, but the overall result will still be a fall in Nod imports. In GDI, since we have a fixed exchange rate, interest rates must be kept constant, so the LM curve will shift right along with the IS curve to LM’, as the reserve bank moves to prevent the domestic interest rate from rising. Outpu ...
Long run Aggregate Supply
... This is simply the intermediate or "normal" range of our AS curve we developed earlier when we discussed the three ranges of levels of employment when we were giving the basics of the AS curve. The curve has a positive slope because as firms attempt to increase the amount of product they produce (ou ...
... This is simply the intermediate or "normal" range of our AS curve we developed earlier when we discussed the three ranges of levels of employment when we were giving the basics of the AS curve. The curve has a positive slope because as firms attempt to increase the amount of product they produce (ou ...
Advances in Business Cycle Theory
... changes, waiting for others to go first 2. Firms delay raising prices until costs rise 3. Firms prefer to vary other product attributes, such as quality, service, or delivery lags 4. Implicit contracts: firms tacitly agree to stabilize prices, perhaps out of ‘fairness’ to customers 5. Explicit contr ...
... changes, waiting for others to go first 2. Firms delay raising prices until costs rise 3. Firms prefer to vary other product attributes, such as quality, service, or delivery lags 4. Implicit contracts: firms tacitly agree to stabilize prices, perhaps out of ‘fairness’ to customers 5. Explicit contr ...
Macro1 Exercise #3
... below full employment, at full employment). In this current situation, the best policy would be to (increase, decrease, leave unchanged) __________ government spending, to (increase, decrease, leave unchanged) __________ interest rates, and to (increase, decrease, leave unchanged) __________ taxes. ...
... below full employment, at full employment). In this current situation, the best policy would be to (increase, decrease, leave unchanged) __________ government spending, to (increase, decrease, leave unchanged) __________ interest rates, and to (increase, decrease, leave unchanged) __________ taxes. ...
represented as a natural log. Hibbs and Dennis find that this
... a. Malthus’ “Grim Law of Population and Food”: the population increases faster than the food supply leading to starvation. 1. Thus, starvation becomes the regulating force. C. Both Smith and Malthus agreed on the central idea that natural forces were in control of the economy. 1. Thus, if human econ ...
... a. Malthus’ “Grim Law of Population and Food”: the population increases faster than the food supply leading to starvation. 1. Thus, starvation becomes the regulating force. C. Both Smith and Malthus agreed on the central idea that natural forces were in control of the economy. 1. Thus, if human econ ...
LBCI Q3 2014
... some of the growth but several areas of concern were not weather related. However, June projections for annual average real GDP provided by the National Association for Business Economics stood at 3.5% for Q2 and 3.1% for Q3. These survey expectations were strong due to some of the pent-up demand sh ...
... some of the growth but several areas of concern were not weather related. However, June projections for annual average real GDP provided by the National Association for Business Economics stood at 3.5% for Q2 and 3.1% for Q3. These survey expectations were strong due to some of the pent-up demand sh ...
Monetary policy and forward guidance in the UK
... activity is running at a pace consistent with the control of inflation. Growth has to be seen in the context of the level of activity from which that growth comes. If that level of activity is significantly below a rate consistent with controlled inflation – as I believe is the case in the UK today ...
... activity is running at a pace consistent with the control of inflation. Growth has to be seen in the context of the level of activity from which that growth comes. If that level of activity is significantly below a rate consistent with controlled inflation – as I believe is the case in the UK today ...
LBCI Q2 2015
... greatest boost in optimism was recorded for hiring expectations, and capital expenditures settled to the least bullish component of the index this quarter. Despite a slowdown in the energy sector, the index coincides with general positive signals observed in the national and Colorado economies. The ...
... greatest boost in optimism was recorded for hiring expectations, and capital expenditures settled to the least bullish component of the index this quarter. Despite a slowdown in the energy sector, the index coincides with general positive signals observed in the national and Colorado economies. The ...
Instructor`s class notes
... o Because both are highly heterogeneous, this will be highly imperfect and there will be pools of vacant jobs and unemployed workers coexisting o The size of this equilibrium pool of unemployed workers (as a percentage of the labor force) is the natural unemployment rate o Natural rate will depend o ...
... o Because both are highly heterogeneous, this will be highly imperfect and there will be pools of vacant jobs and unemployed workers coexisting o The size of this equilibrium pool of unemployed workers (as a percentage of the labor force) is the natural unemployment rate o Natural rate will depend o ...
Disequilibrium unemployment
... The most significant cause of disequilibrium unemployment is a fall in aggregate demand for all goods and services and hence for labour (as labour is a derived demand [where demand for one good or service occurs as a result of demand for another]). This theory was first put forward by John Maynard K ...
... The most significant cause of disequilibrium unemployment is a fall in aggregate demand for all goods and services and hence for labour (as labour is a derived demand [where demand for one good or service occurs as a result of demand for another]). This theory was first put forward by John Maynard K ...
Christopher A. Pissarides - Prize Lecture
... mathematical models of individual behaviour and labour market equilibrium appeared. The development of formal mathematical models with search frictions coincided with the time that I was looking for a topic for my PhD research.2 Two things about search impressed me most. In the Phelps volume, search ...
... mathematical models of individual behaviour and labour market equilibrium appeared. The development of formal mathematical models with search frictions coincided with the time that I was looking for a topic for my PhD research.2 Two things about search impressed me most. In the Phelps volume, search ...
What Monetary Policy Can and Cannot Do
... stabilize the economy should and has increased. I think the medical analogy is useful. But it is just an analogy. Economics is not medicine. The speed with which the two disciplines make progress and the ultimate bounds on their capacity to improve welfare are not necessarily the same. We all stand ...
... stabilize the economy should and has increased. I think the medical analogy is useful. But it is just an analogy. Economics is not medicine. The speed with which the two disciplines make progress and the ultimate bounds on their capacity to improve welfare are not necessarily the same. We all stand ...
View/Open
... tlons are formed ratlOnally, these models are fre quently referred to as ratlOnal expectatlOnB models However, th,s assumption lS but one of several lden tIfyIng th{s class of models' The other maJor aSsumptlOns are (1) perfect wage and price flexlblh ty WIll occur, leading to contmuous market cl ...
... tlons are formed ratlOnally, these models are fre quently referred to as ratlOnal expectatlOnB models However, th,s assumption lS but one of several lden tIfyIng th{s class of models' The other maJor aSsumptlOns are (1) perfect wage and price flexlblh ty WIll occur, leading to contmuous market cl ...
Macro1 Exercise #4
... These materials may be found at the Class Web site prior to beginning the exercise. For many of the exercise’s questions, it will be necessary to refer to those instructions. For many of the exercise’s questions, it will be necessary to refer to your text. Open the Macro1 module. You will see a tabl ...
... These materials may be found at the Class Web site prior to beginning the exercise. For many of the exercise’s questions, it will be necessary to refer to those instructions. For many of the exercise’s questions, it will be necessary to refer to your text. Open the Macro1 module. You will see a tabl ...
Keynes`s relevance in the new millennium
... agents learn and learn quickly so that surprises (in both senses) become increasingly scarce. Eventually, people cannot be fooled. The weakness with this particular line of argument is that it predicts that any fluctuations in output should be random and serially uncorrelated while the evidence tel ...
... agents learn and learn quickly so that surprises (in both senses) become increasingly scarce. Eventually, people cannot be fooled. The weakness with this particular line of argument is that it predicts that any fluctuations in output should be random and serially uncorrelated while the evidence tel ...
Macroeconomic Fluctuations in the UK Economy
... was presented by Kydland and Prescott (1982). Their work was the first to show explicitly that a real business cycle model, driven by exogenous shocks to technology, was capable of generating time series with statistical properties characteristic of post war U.S. business cycles. Variability in the ...
... was presented by Kydland and Prescott (1982). Their work was the first to show explicitly that a real business cycle model, driven by exogenous shocks to technology, was capable of generating time series with statistical properties characteristic of post war U.S. business cycles. Variability in the ...
Edmund Phelps
Edmund Strother Phelps, Jr. (born July 26, 1933) is an American economist and the winner of the 2006 Nobel Memorial Prize in Economic Sciences. Early in his career he became renowned for his research at Yale's Cowles Foundation in the first half of the 1960s on the sources of economic growth. His demonstration of the Golden Rule savings rate, a concept first devised by John von Neumann and Maurice Allais, started a wave of research on how much a nation ought to spend on present consumption rather than save and invest for future generations. His most seminal work inserted a microfoundation—one featuring imperfect information, incomplete knowledge and expectations about wages and prices—to support a macroeconomic theory of employment determination and price-wage dynamics. This led to his development of the natural rate of unemployment—its existence and the mechanism governing its size.Phelps has been McVickar Professor of Political Economy at Columbia University since 1982. He is also the director of Columbia's Center on Capitalism and Society.