Brazil: how macroeconomic variables affect consumer confidence
... In general terms, a trend of economic expansion is observed. Notwithstanding, 2003 was a year in which economic activity declined and 2005 saw a slowdown in economic growth. This variable is important to the analysis because much of the literature considers output to be a very important determinant ...
... In general terms, a trend of economic expansion is observed. Notwithstanding, 2003 was a year in which economic activity declined and 2005 saw a slowdown in economic growth. This variable is important to the analysis because much of the literature considers output to be a very important determinant ...
NBER WORKING PAPER SERIES THE CONDUCT OF DOMESTIC ICY Robert J. Gordon
... 3Estimates of the Okun's Law relationship between the U. S. unemployment rate and the output ratio are contained in Cordon (1982a, p. 94). The relationship between the demographically weighted unemployment rate and the output ratio remains completely stable over the 1954—80 period. The natural aggre ...
... 3Estimates of the Okun's Law relationship between the U. S. unemployment rate and the output ratio are contained in Cordon (1982a, p. 94). The relationship between the demographically weighted unemployment rate and the output ratio remains completely stable over the 1954—80 period. The natural aggre ...
The Power of Forward Guidance Revisited
... real rate with some error: rt = it − Etπt+1 shock to the short term real rate in period tthat becomes known in period t − j.5 Absent any monetary shocks, the real interest rate will perfectly track the natural real rate and both the output gap and inflation will be zero. Suppose ...
... real rate with some error: rt = it − Etπt+1 shock to the short term real rate in period tthat becomes known in period t − j.5 Absent any monetary shocks, the real interest rate will perfectly track the natural real rate and both the output gap and inflation will be zero. Suppose ...
NBER WORKING PAPER SERIES Junhee Lee Joonhyuk Song
... as well as increase in unemployment in the presence of friction in both labor and capital markets. Production may decline as the GDP growth rate becomes lower when production costs are raised and secondly, large oil price changes may increase uncertainty in business investment, hence, inducing lower ...
... as well as increase in unemployment in the presence of friction in both labor and capital markets. Production may decline as the GDP growth rate becomes lower when production costs are raised and secondly, large oil price changes may increase uncertainty in business investment, hence, inducing lower ...
How does unconventional monetary policy affect inequality
... debt, while the bottom two quintiles actually have negative net assets due to higher debt loads (primarily residential-related) than asset holdings. These groups may have benefited from low interest rates (abstracting from further analysis on the ease of access to credit). While inflation has been v ...
... debt, while the bottom two quintiles actually have negative net assets due to higher debt loads (primarily residential-related) than asset holdings. These groups may have benefited from low interest rates (abstracting from further analysis on the ease of access to credit). While inflation has been v ...
An Analysis of the Fiscal Stance of the New Zealand Government
... spending on unemployment benefits, P is the price level (in this case the Consumer Price Index), H is the level of government debt held by New Zealand and eF by foreigners (e being the exchange rate and F the face value of debt). From Table 2 and Figure 1 it can be seen that the level of the nominal ...
... spending on unemployment benefits, P is the price level (in this case the Consumer Price Index), H is the level of government debt held by New Zealand and eF by foreigners (e being the exchange rate and F the face value of debt). From Table 2 and Figure 1 it can be seen that the level of the nominal ...
19.3 aggregate demand
... quantity of real GDP demanded and the price level when all other influences on expenditure plans remain the same. Other things remaining the same, • When the price level rises, the quantity of real GDP demanded decreases. • When the price level falls, the quantity of real GDP demanded increases. ...
... quantity of real GDP demanded and the price level when all other influences on expenditure plans remain the same. Other things remaining the same, • When the price level rises, the quantity of real GDP demanded decreases. • When the price level falls, the quantity of real GDP demanded increases. ...
View Chapter 4, Growth, Unemployment, and Inflation
... year. It’s possible, then, for GDP to increase from one year to the next simply because market prices rose. The economy may not have, in fact, produced more. Thus, we need to make the important distinction between nominal GDP and real GDP. To see if an economy is growing, we need to know if it did a ...
... year. It’s possible, then, for GDP to increase from one year to the next simply because market prices rose. The economy may not have, in fact, produced more. Thus, we need to make the important distinction between nominal GDP and real GDP. To see if an economy is growing, we need to know if it did a ...
Monetary Policy: Recent Experience and Future Directions
... bubbles and corrections that have played a key role in the events of the past three years were neglected. To illustrate, imagine a scenario where inflation falls because of a positive supply shock, such as a reduction in manufacturing import prices from Emerging market economies. An inflation-target ...
... bubbles and corrections that have played a key role in the events of the past three years were neglected. To illustrate, imagine a scenario where inflation falls because of a positive supply shock, such as a reduction in manufacturing import prices from Emerging market economies. An inflation-target ...
Price Level
... Why the Aggregate-Supply Curve Slopes Upward in the Short Run • The Sticky-Wage Theory • Nominal wages are slow to adjust to changing economic conditions, or are “sticky” in the short run. • When nominal wages are based on the expected prices and do not respond immediately when the actual price lev ...
... Why the Aggregate-Supply Curve Slopes Upward in the Short Run • The Sticky-Wage Theory • Nominal wages are slow to adjust to changing economic conditions, or are “sticky” in the short run. • When nominal wages are based on the expected prices and do not respond immediately when the actual price lev ...
Change in IIP and WPI base year: What can be
... living. The weightage of primary articles has been increased by 2.5% in the new series. The new series excludes indirect taxes when reckoning prices. New WPI food index has been introduced combining food articles under the primary articles and food products under the manufacturing products. As a res ...
... living. The weightage of primary articles has been increased by 2.5% in the new series. The new series excludes indirect taxes when reckoning prices. New WPI food index has been introduced combining food articles under the primary articles and food products under the manufacturing products. As a res ...
Does the Yield Curve Signal Recession?
... funds rate.” That is, when the real federal funds rate—the target rate set by the FOMC, adjusted for inflation—is high relative to its long-run level, the chance of a recession increases. While Greenspan does not cite the statistical analysis he refers to, there is some evidence that movements in s ...
... funds rate.” That is, when the real federal funds rate—the target rate set by the FOMC, adjusted for inflation—is high relative to its long-run level, the chance of a recession increases. While Greenspan does not cite the statistical analysis he refers to, there is some evidence that movements in s ...
THE CAPITAL ASSET PRICING MODEL`S RISK
... practitioners arbitrarily use short-term or long-term government securities as proxies for the risk-free security. Bruner et al. (1998) found wide variation in the choice of risk-free rates for the CAPM. Practitioners strongly prefer long-term bonds; 70% of corporations and financial advisors use Tr ...
... practitioners arbitrarily use short-term or long-term government securities as proxies for the risk-free security. Bruner et al. (1998) found wide variation in the choice of risk-free rates for the CAPM. Practitioners strongly prefer long-term bonds; 70% of corporations and financial advisors use Tr ...
Chapter 26: Aggregate Supply and Aggregate Demand
... In the long run, the money wage falls until the SAS curve passes through the long-run equilibrium point. ...
... In the long run, the money wage falls until the SAS curve passes through the long-run equilibrium point. ...
Inflation Report - Palestine Monetary Authority
... the first quarter of 2013, and 0.6 percent compared with the fourth quarter of 2013. Inflation rate came higher than the rate registered in the previous quarter (2.0 percent) and in the corresponding quarter of 2013 (1.7 percent). This rate is much lower than the rate registered in the MENA region ( ...
... the first quarter of 2013, and 0.6 percent compared with the fourth quarter of 2013. Inflation rate came higher than the rate registered in the previous quarter (2.0 percent) and in the corresponding quarter of 2013 (1.7 percent). This rate is much lower than the rate registered in the MENA region ( ...
1 - Alexander Mosesov`s
... With respect to this book, microeconomist would look into the demand and supply of economics text-books, structures of their product and factor markets, individual consumption and production decisions, resources in use, production costs and profits. Macroeconomist though would not bother with such d ...
... With respect to this book, microeconomist would look into the demand and supply of economics text-books, structures of their product and factor markets, individual consumption and production decisions, resources in use, production costs and profits. Macroeconomist though would not bother with such d ...
This PDF is a selection from a published volume from
... worse performance. In these countries, deviations from both central targets and upper bounds are larger and more common.2 This outcome suggests that either inflation targeters in EMEs are less committed to their targets or inflation targeting in these countries is a more challenging task than in dev ...
... worse performance. In these countries, deviations from both central targets and upper bounds are larger and more common.2 This outcome suggests that either inflation targeters in EMEs are less committed to their targets or inflation targeting in these countries is a more challenging task than in dev ...
Ch 33 Aggregate Demand and Aggregate Supply
... hence that changes in the money supply do have short-‐run effects. Even the classical economists, like David Hume, observed that changes in the money supply appear to affect output and employment in th ...
... hence that changes in the money supply do have short-‐run effects. Even the classical economists, like David Hume, observed that changes in the money supply appear to affect output and employment in th ...
Investigating the Link between Population Aging and Deflation
... regressions involving 22 countries over a 56 year period (1955-2010). We also use a reduced-form panel-data Vector Autoregression (VAR) methodology to capture dynamic interactions among the main macroeconomic variables without having to take an explicit stand on exogeneity. The world population has ...
... regressions involving 22 countries over a 56 year period (1955-2010). We also use a reduced-form panel-data Vector Autoregression (VAR) methodology to capture dynamic interactions among the main macroeconomic variables without having to take an explicit stand on exogeneity. The world population has ...
Aggregate Demand and Aggregate Supply
... First this works only for unanticipated increases in the price level, or, as some people put it, unexpected inflation. If you expect prices to rise by, say, six percent, you would take the increase in the price of bicycles from $100 to $106 as simply confirmation of your expectations. ...
... First this works only for unanticipated increases in the price level, or, as some people put it, unexpected inflation. If you expect prices to rise by, say, six percent, you would take the increase in the price of bicycles from $100 to $106 as simply confirmation of your expectations. ...
Principles of Macroeconomics, Case/Fair/Oster, 10e
... Keynes recognized that expectations (in the form of “animal spirits”) play a big part in economic behavior. The problem is that traditional models assume that expectations are formed in naïve ways, which is inconsistent with the assumptions of microeconomics. If, as microeconomic theory assumes, peo ...
... Keynes recognized that expectations (in the form of “animal spirits”) play a big part in economic behavior. The problem is that traditional models assume that expectations are formed in naïve ways, which is inconsistent with the assumptions of microeconomics. If, as microeconomic theory assumes, peo ...
Inflation
In economics, inflation is a sustained increase in the general price level of goods and services in an economy over a period of time.When the price level rises, each unit of currency buys fewer goods and services. Consequently, inflation reflects a reduction in the purchasing power per unit of money – a loss of real value in the medium of exchange and unit of account within the economy. A chief measure of price inflation is the inflation rate, the annualized percentage change in a general price index (normally the consumer price index) over time. The opposite of inflation is deflation.Inflation affects an economy in various ways, both positive and negative. Negative effects of inflation include an increase in the opportunity cost of holding money, uncertainty over future inflation which may discourage investment and savings, and if inflation were rapid enough, shortages of goods as consumers begin hoarding out of concern that prices will increase in the future.Inflation also has positive effects: Fundamentally, inflation gives everyone an incentive to spend and invest, because if they don't, their money will be worth less in the future. This increase in spending and investment can benefit the economy. However it may also lead to sub-optimal use of resources. Inflation reduces the real burden of debt, both public and private. If you have a fixed-rate mortgage on your house, your salary is likely to increase over time due to wage inflation, but your mortgage payment will stay the same. Over time, your mortgage payment will become a smaller percentage of your earnings, which means that you will have more money to spend. Inflation keeps nominal interest rates above zero, so that central banks can reduce interest rates, when necessary, to stimulate the economy. Inflation reduces unemployment to the extent that unemployment is caused by nominal wage rigidity. When demand for labor falls but nominal wages do not, as typically occurs during a recession, the supply and demand for labor cannot reach equilibrium, and unemployment results. By reducing the real value of a given nominal wage, inflation increases the demand for labor, and therefore reduces unemployment.Economists generally believe that high rates of inflation and hyperinflation are caused by an excessive growth of the money supply. However, money supply growth does not necessarily cause inflation. Some economists maintain that under the conditions of a liquidity trap, large monetary injections are like ""pushing on a string"". Views on which factors determine low to moderate rates of inflation are more varied. Low or moderate inflation may be attributed to fluctuations in real demand for goods and services, or changes in available supplies such as during scarcities. However, the consensus view is that a long sustained period of inflation is caused by money supply growing faster than the rate of economic growth.Today, most economists favor a low and steady rate of inflation. Low (as opposed to zero or negative) inflation reduces the severity of economic recessions by enabling the labor market to adjust more quickly in a downturn, and reduces the risk that a liquidity trap prevents monetary policy from stabilizing the economy. The task of keeping the rate of inflation low and stable is usually given to monetary authorities. Generally, these monetary authorities are the central banks that control monetary policy through the setting of interest rates, through open market operations, and through the setting of banking reserve requirements.