NBER WORKING PAPER SERIES MONETARIST INTERPRETATIONS OF THE GREAT DEPRESSION:
... In response to a demand shock, prices do not typically adjust rapidly enough to clear markets, and so agents find themselves constrained by a level of sales or employment different from what they would voluntarily choose to supply at going prices and wages (Barro and Grossman, 1976, Chapter ...
... In response to a demand shock, prices do not typically adjust rapidly enough to clear markets, and so agents find themselves constrained by a level of sales or employment different from what they would voluntarily choose to supply at going prices and wages (Barro and Grossman, 1976, Chapter ...
Principles of Economics, Case and Fair,9e
... aggregate supply The total supply of all goods and services in an economy. The Aggregate Supply Curve: A Warning aggregate supply (AS) curve A graph that shows the relationship between the aggregate quantity of output supplied by all firms in an economy and the overall price level. An “aggregate sup ...
... aggregate supply The total supply of all goods and services in an economy. The Aggregate Supply Curve: A Warning aggregate supply (AS) curve A graph that shows the relationship between the aggregate quantity of output supplied by all firms in an economy and the overall price level. An “aggregate sup ...
Anno Stolper: The Appeal of Risky Assets
... In the wake of the recent financial crisis, it has often been argued that fund managers did not know about the risks in their portfolio; otherwise, it has been argued, they would not have invested in such risky assets. We argue, however, that fund managers might have known about the risks and invest ...
... In the wake of the recent financial crisis, it has often been argued that fund managers did not know about the risks in their portfolio; otherwise, it has been argued, they would not have invested in such risky assets. We argue, however, that fund managers might have known about the risks and invest ...
aggregate supply (AS) curve
... aggregate supply The total supply of all goods and services in an economy. The Aggregate Supply Curve: A Warning aggregate supply (AS) curve A graph that shows the relationship between the aggregate quantity of output supplied by all firms in an economy and the overall price level. An “aggregate sup ...
... aggregate supply The total supply of all goods and services in an economy. The Aggregate Supply Curve: A Warning aggregate supply (AS) curve A graph that shows the relationship between the aggregate quantity of output supplied by all firms in an economy and the overall price level. An “aggregate sup ...
NBER WORKING PAPER SERIES DOES STABILIZING INFLATION CONTRIBUTE TO STABILIZING ECONOMIC ACTIVITY?
... In contrast, the run-up in energy prices since 2003 has had only modest effects on inflation for other goods; as a result, monetary policy has been able to avoid responding precipitously to higher oil prices. More generally, the period from the mid-1960s to the early 1980s was one of relatively high ...
... In contrast, the run-up in energy prices since 2003 has had only modest effects on inflation for other goods; as a result, monetary policy has been able to avoid responding precipitously to higher oil prices. More generally, the period from the mid-1960s to the early 1980s was one of relatively high ...
NBER WORKING PAPER SERIES LAND-PRICE DYNAMICS AND MACROECONOMIC FLUCTUATIONS Zheng Liu Pengfei Wang
... I. Introduction The recent financial crisis caused by a collapse of the housing market propelled the U.S. economy into the Great Recession. A notable development during the crisis period was a slump in business investment in tandem with a sharp decline in land prices (Figure 1). The crisis has gener ...
... I. Introduction The recent financial crisis caused by a collapse of the housing market propelled the U.S. economy into the Great Recession. A notable development during the crisis period was a slump in business investment in tandem with a sharp decline in land prices (Figure 1). The crisis has gener ...
Document
... thus link explicitely the finite-agent models to the limiting economies. Studying the limiting economy allows us to arrive at tractable close-form expressions. In the main body of this paper we study an economy where traders have CARA preferences with the same risk-aversion parameter. There is one r ...
... thus link explicitely the finite-agent models to the limiting economies. Studying the limiting economy allows us to arrive at tractable close-form expressions. In the main body of this paper we study an economy where traders have CARA preferences with the same risk-aversion parameter. There is one r ...
BSL AMC - Indian Business Chamber Of Luxembourg
... o Foreign Institutional Investor (FII) needs to apply for a debt limit from Securities Exchange Board of India(SEBI) are issued from time to time o Current limits assigned by the ministry of Finance are as follows: US$ 15 billion for Corporate Bonds US $ 10 billion for Government Securities ...
... o Foreign Institutional Investor (FII) needs to apply for a debt limit from Securities Exchange Board of India(SEBI) are issued from time to time o Current limits assigned by the ministry of Finance are as follows: US$ 15 billion for Corporate Bonds US $ 10 billion for Government Securities ...
Macroeconomic Shocks, Housing Market and Banks` Performance
... studied the effect of monetary policy on asset prices and banking behavior, either from the perspective of their stability and balance sheet decisions. According to these works, the monetary policy aspect of the macroeconomic performance appears to have a prominent role for explaining how, during no ...
... studied the effect of monetary policy on asset prices and banking behavior, either from the perspective of their stability and balance sheet decisions. According to these works, the monetary policy aspect of the macroeconomic performance appears to have a prominent role for explaining how, during no ...
The St~cture of Financial Markets and the Monetary Mechanism
... represents the effects of a monetary authority which has the power of fixing "exogenously" the nominal money supply through techniques which need not be specified at this point and equation (6) defines equlibrium in the money market. Equations (4)-(6) together define the Hicksian LM schedule, the co ...
... represents the effects of a monetary authority which has the power of fixing "exogenously" the nominal money supply through techniques which need not be specified at this point and equation (6) defines equlibrium in the money market. Equations (4)-(6) together define the Hicksian LM schedule, the co ...
NBER WORKING PAPER SERIES MACROECONOMIC MODELING FOR MONETARY POLICY EVALUATION Jordi Galí
... emerged in response to the downfall of traditional macroeconomic modelling: New Keynesian theory and real business cycle theory.1 The New Keynesian paradigm arose in the 1980s as an attempt to provide microfoundations for key Keynesian concepts such as the ine¢ ciency of aggregate ‡uctuations, nomi ...
... emerged in response to the downfall of traditional macroeconomic modelling: New Keynesian theory and real business cycle theory.1 The New Keynesian paradigm arose in the 1980s as an attempt to provide microfoundations for key Keynesian concepts such as the ine¢ ciency of aggregate ‡uctuations, nomi ...
Synchronization risk and delayed arbitrage
... requirements force short-sellers to put additional money into low interest bearing margin accounts. This can bind a large amount of an arbitrageur’s capital, which could be used for alternative investment opportunities. Note that short-sale costs also arise if an asset is undervalued. In this case, ...
... requirements force short-sellers to put additional money into low interest bearing margin accounts. This can bind a large amount of an arbitrageur’s capital, which could be used for alternative investment opportunities. Note that short-sale costs also arise if an asset is undervalued. In this case, ...
Principles of Economics, Case and Fair,9e
... aggregate supply The total supply of all goods and services in an economy. The Aggregate Supply Curve: A Warning aggregate supply (AS) curve A graph that shows the relationship between the aggregate quantity of output supplied by all firms in an economy and the overall price level. An “aggregate sup ...
... aggregate supply The total supply of all goods and services in an economy. The Aggregate Supply Curve: A Warning aggregate supply (AS) curve A graph that shows the relationship between the aggregate quantity of output supplied by all firms in an economy and the overall price level. An “aggregate sup ...
NBER WORKING PAPER SERIES IS-LM AND MONETARISM Michael D. Bordo Anna J. Schwartz
... factors other than those affecting the demand for money. A third issue is that Keynes asserts that under conditions of underemployment, when interest rates are positive but low, a liquidity trap exists such that the demand for money becomes infinitely elastic. Changes in the real supply of money the ...
... factors other than those affecting the demand for money. A third issue is that Keynes asserts that under conditions of underemployment, when interest rates are positive but low, a liquidity trap exists such that the demand for money becomes infinitely elastic. Changes in the real supply of money the ...
NBER WORKING PAPER SERIES THE THEORY AND THE FACTS
... oligopoly (e.g., Bertrand, Cournot, kinked demand curve) assume that however price is set, there are no unsatisfied demanders or sellers at that price, that price changes are passed along to all buyers simultaneously, and that it is not costly to transact in the market. One common theme of most mode ...
... oligopoly (e.g., Bertrand, Cournot, kinked demand curve) assume that however price is set, there are no unsatisfied demanders or sellers at that price, that price changes are passed along to all buyers simultaneously, and that it is not costly to transact in the market. One common theme of most mode ...
The Effects of Heterogeneity in Price Setting on Price and Inflation
... Standard models of nominal price rigidity based on the seminal contributions of either Taylor (1979, 1980) or Calvo (1983) usually do not involve any explicit attempt to model heterogeneity in pricesetting rules followed by firms. They are usually assumed to be ex-ante identical, modulo the time at ...
... Standard models of nominal price rigidity based on the seminal contributions of either Taylor (1979, 1980) or Calvo (1983) usually do not involve any explicit attempt to model heterogeneity in pricesetting rules followed by firms. They are usually assumed to be ex-ante identical, modulo the time at ...
What is the Wealth of a Nation?
... Between September 2000 and March 2001, the market price of GE stock fell by about $20 per share (from about $60 per share to about $40 a share). With close to 10 billion shares of GE stock outstanding, that comes to a loss of $200 billion in the total market value of GE common stock. Who should be b ...
... Between September 2000 and March 2001, the market price of GE stock fell by about $20 per share (from about $60 per share to about $40 a share). With close to 10 billion shares of GE stock outstanding, that comes to a loss of $200 billion in the total market value of GE common stock. Who should be b ...
McCallum rule and Chinese monetary policy
... and loans), the interest rate channel has been ineffective for various reasons. The liberalisation of the interest rates has advanced rather slowly, the banking sector has not traditionally been profit-oriented and in the companies' investment decisions, interest costs have played a minor role. Over ...
... and loans), the interest rate channel has been ineffective for various reasons. The liberalisation of the interest rates has advanced rather slowly, the banking sector has not traditionally been profit-oriented and in the companies' investment decisions, interest costs have played a minor role. Over ...
NBER WORKING PAPER SERIES REAL BUSINESS CYCLES AND THE LUCAS PARADIGM
... and Plosser (1984).) Second, another significant property of this ...
... and Plosser (1984).) Second, another significant property of this ...
This PDF is a selection from a published volume from... National Bureau of Economic Research
... is 20 percent, the loan- to-value (LTV) ratio is 80 percent, and the leverage is 5 to 1. These ratios are all diVerent ways of saying the same thing. These leverage numbers on individual loans and collateral are the building blocks out of which aggregate measures of asset leverage, institutional lev ...
... is 20 percent, the loan- to-value (LTV) ratio is 80 percent, and the leverage is 5 to 1. These ratios are all diVerent ways of saying the same thing. These leverage numbers on individual loans and collateral are the building blocks out of which aggregate measures of asset leverage, institutional lev ...
Product Markets in PAM: Price Determination and Gains from Trade
... prices until the market reached balance at price OP1. Similarly, if the price temporarily were lower than OP1, supply would be less than demand, there would be excess demand on the market, and there would be upward pressure on prices until the market reached balance at price OP1. If the country cann ...
... prices until the market reached balance at price OP1. Similarly, if the price temporarily were lower than OP1, supply would be less than demand, there would be excess demand on the market, and there would be upward pressure on prices until the market reached balance at price OP1. If the country cann ...
Review of theoretical literature on price setting in macroeconomics
... For South Africa, as with other countries, services prices are more sticky than goods prices, which may be indicative both of high labour input costs in services, as well as low levels of competition in the services sector. However, in the South African situation, high degrees of price stickiness fo ...
... For South Africa, as with other countries, services prices are more sticky than goods prices, which may be indicative both of high labour input costs in services, as well as low levels of competition in the services sector. However, in the South African situation, high degrees of price stickiness fo ...
This PDF is a selection from a published volume from... Research Volume Title: Asset Prices and Monetary Policy
... an increase in demand for durables. Hence, collateral limits per se induce inefficient movements in the relative price of durables. On the other hand, though, a strict stabilization of durable prices is largely detrimental for the borrower and would be inconsistent with the need of realizing sectoral ...
... an increase in demand for durables. Hence, collateral limits per se induce inefficient movements in the relative price of durables. On the other hand, though, a strict stabilization of durable prices is largely detrimental for the borrower and would be inconsistent with the need of realizing sectoral ...
A Model of Capital and Crises Zhiguo He Arvind Krishnamurthy May 2011
... Financial crises, such as the hedge fund crisis of 1998 or the 2007/2008 subprime crisis, have several common characteristics: risk premia rise, interest rates fall, conditional volatilities of asset prices rise, correlations between assets rise, and investors “‡y to the quality” of a riskless liqui ...
... Financial crises, such as the hedge fund crisis of 1998 or the 2007/2008 subprime crisis, have several common characteristics: risk premia rise, interest rates fall, conditional volatilities of asset prices rise, correlations between assets rise, and investors “‡y to the quality” of a riskless liqui ...
Lecture Outline
... As a result, owners and workers at this firm will see an increase in income, and will therefore likely increase their own consumption. If consumers want to purchase more goods and services, they will need to increase their holdings of ...
... As a result, owners and workers at this firm will see an increase in income, and will therefore likely increase their own consumption. If consumers want to purchase more goods and services, they will need to increase their holdings of ...
Economic bubble
An economic bubble (sometimes referred to as a speculative bubble, a market bubble, a price bubble, a financial bubble, a speculative mania or a balloon) is trade in an asset at a price or price range that strongly deviates from the corresponding asset's intrinsic value. It could also be described as a situation in which asset prices appear to be based on implausible or inconsistent views about the future.Because it is often difficult to observe intrinsic values in real-life markets, bubbles are often conclusively identified only in retrospect, when a sudden drop in prices appears. Such a drop is known as a crash or a bubble burst. Both the boom and the burst phases of the bubble are examples of a positive feedback mechanism, in contrast to the negative feedback mechanism that determines the equilibrium price under normal market circumstances. Prices in an economic bubble can fluctuate erratically, and become impossible to predict from supply and demand alone.While some economists deny that bubbles occur, the cause of bubbles remains disputed by those who are convinced that asset prices often deviate strongly from intrinsic values. Many explanations have been suggested, and research has recently shown that bubbles may appear even without uncertainty, speculation, or bounded rationality. In such cases, the bubbles may be argued to be rational, where investors at every point fully compensated for the possibility that the bubble might collapse by higher returns. These approaches require that the timing of the bubble collapse can only be forecast probabilistically and the bubble process is often modelled using a Markov switching model. It has also been suggested that bubbles might ultimately be caused by processes of price coordination or emerging social norms.