This PDF is a selection from an out-of-print volume from... of Economic Research
... interact with, long growth trends which dominate developments across decades. Peacetime expansions in the United States averaged about 3 years in the last half-century, 2 years in the earlier periods containing 10 cycles each (table 2.1). Each of the wartime expansions was much longer. Contractions ...
... interact with, long growth trends which dominate developments across decades. Peacetime expansions in the United States averaged about 3 years in the last half-century, 2 years in the earlier periods containing 10 cycles each (table 2.1). Each of the wartime expansions was much longer. Contractions ...
chapter 35: extending the analysis of aggregate supply - jb
... It is essential to remember the importance of low interest rates in fueling long-run economic growth. While some economic stabilization policies will help to promote both short-run and long-run economic growth, others will not. Expansionary monetary policy (reducing the reserve requirement and disco ...
... It is essential to remember the importance of low interest rates in fueling long-run economic growth. While some economic stabilization policies will help to promote both short-run and long-run economic growth, others will not. Expansionary monetary policy (reducing the reserve requirement and disco ...
Modeling Portfolios that Contain Risky Assets I: Risk and
... computed from selected return rate histories of the relevant assets. We will then use these statistics to calibrate a model that will predict how a set of ideal portfolios might behave in the future. The implicit assumption of this approach is that in the future the market will behave statistically ...
... computed from selected return rate histories of the relevant assets. We will then use these statistics to calibrate a model that will predict how a set of ideal portfolios might behave in the future. The implicit assumption of this approach is that in the future the market will behave statistically ...
Inflation, Debt, and Default
... and finally becomes positive in the most recent sample (1994–2015). If inflation co-varies positively with domestic consumption growth, then returns on domestic nominal debt are high (low) when consumption growth is low (high). This feature makes domestic nominal bonds less risky from a domestic inv ...
... and finally becomes positive in the most recent sample (1994–2015). If inflation co-varies positively with domestic consumption growth, then returns on domestic nominal debt are high (low) when consumption growth is low (high). This feature makes domestic nominal bonds less risky from a domestic inv ...
dees mmi08 6664950 en
... New Keynesian Phillips Curves (NKPC) have been widely used in the macroeconomic literature. Yet their empirical implementation raises a number of issues that continue to be of important concern. The first is whether such equations are identified. In order to determine whether the necessary and suffici ...
... New Keynesian Phillips Curves (NKPC) have been widely used in the macroeconomic literature. Yet their empirical implementation raises a number of issues that continue to be of important concern. The first is whether such equations are identified. In order to determine whether the necessary and suffici ...
PDF
... cif/fob margins and trade taxes. In the case of savings and investment, the global pool of savings is accumulated in US dollars. Investment, once allocated to region j, is converted to that region’s currency at the rate Ej. The third, and most cryptic, set of international transactions in the origin ...
... cif/fob margins and trade taxes. In the case of savings and investment, the global pool of savings is accumulated in US dollars. Investment, once allocated to region j, is converted to that region’s currency at the rate Ej. The third, and most cryptic, set of international transactions in the origin ...
Transaction in the share market
... No firm would pass on a positive NPV project because of the lack of funds, because, by definition the incremental cost of those funds is less than the IRR of the project, so the value of the firm is maximized only if the project is undertaken. If the firm can’t make good use of free cash flow (ie. I ...
... No firm would pass on a positive NPV project because of the lack of funds, because, by definition the incremental cost of those funds is less than the IRR of the project, so the value of the firm is maximized only if the project is undertaken. If the firm can’t make good use of free cash flow (ie. I ...
Ecns 202 and Ecns 206 Course Packet
... Upon completion of this course, students should be able to: • Compute measures of macroeconomic activity, such as the national income accounts, inflation, and unemployment, and evaluate the shortcomings of traditional economic measures. • Describe the contemporary banking and monetary system and be ...
... Upon completion of this course, students should be able to: • Compute measures of macroeconomic activity, such as the national income accounts, inflation, and unemployment, and evaluate the shortcomings of traditional economic measures. • Describe the contemporary banking and monetary system and be ...
Working Paper No. 385 Macroeconomic Policies of the Economic
... inflation the situation is no better. The euro area unemployment is already high at 8.8 percent (April, 2003) and is forecasted to remain at 8.8 percent for 2003 and for 2004, and though the rate is much lower in the U.S. and Britain, it is now increasing in all three countries (and quite rapidly in ...
... inflation the situation is no better. The euro area unemployment is already high at 8.8 percent (April, 2003) and is forecasted to remain at 8.8 percent for 2003 and for 2004, and though the rate is much lower in the U.S. and Britain, it is now increasing in all three countries (and quite rapidly in ...
DP2007/10 Understanding the New Zealand Current Account: A Structural Approach
... Two recent studies, Liu (2005) and Santacreu (2006), estimate habit formation to be important for New Zealand, implying a high degree of additional smoothing in consumption. With habit formation in consumption, utility is derived both from the level of consumption and from the increase over last per ...
... Two recent studies, Liu (2005) and Santacreu (2006), estimate habit formation to be important for New Zealand, implying a high degree of additional smoothing in consumption. With habit formation in consumption, utility is derived both from the level of consumption and from the increase over last per ...
0324236956_122417
... r is the opportunity cost of holding money. An increase in r reduces money demand: Households attempt to buy bonds to take advantage of the higher interest rate. Hence, an increase in r causes a decrease in money demand, other things equal. ...
... r is the opportunity cost of holding money. An increase in r reduces money demand: Households attempt to buy bonds to take advantage of the higher interest rate. Hence, an increase in r causes a decrease in money demand, other things equal. ...
Money demand in the euro area
... The annual growth in M3 averaged 7.9% in the 2001-2008 period, reaching even two-digit growth rates from February 2007 to May 2008. At the same time, prices were comparably stable, with yearly inflation rates averaging 2.3% and never rising above 4%. The apparent divergence between money and prices ...
... The annual growth in M3 averaged 7.9% in the 2001-2008 period, reaching even two-digit growth rates from February 2007 to May 2008. At the same time, prices were comparably stable, with yearly inflation rates averaging 2.3% and never rising above 4%. The apparent divergence between money and prices ...
Quantitative Easing and the American Economy: How Saving is
... which rates have not dropped. However, in actuality, we are seeing increased saving levels, despite the sharp drops in interest rates. This is a puzzle that requires exploration because it is contrary to economic theory. By highlighting the link between saving and price level, and uncovering the le ...
... which rates have not dropped. However, in actuality, we are seeing increased saving levels, despite the sharp drops in interest rates. This is a puzzle that requires exploration because it is contrary to economic theory. By highlighting the link between saving and price level, and uncovering the le ...
A Lesson from the Great Depression that the Fed Might have Learned
... much higher for this period than for 2008; thus, agents were not able to substitute between the di¤erent types of Treasury securities as they would have without any frictions. The purchases of long-term securities by the central bank in this model then a¤ects the long-term yield, and consequently, t ...
... much higher for this period than for 2008; thus, agents were not able to substitute between the di¤erent types of Treasury securities as they would have without any frictions. The purchases of long-term securities by the central bank in this model then a¤ects the long-term yield, and consequently, t ...
I - Niehaus Center for Globalization and Governance
... (Frenkel 2004), and less risk of capital flight and currency crises (Crystal 1994; Kaminsky et al 1997). However, the majority of developing states have kept their real exchange rates at overvalued levels for most of the postwar period (Huizinga 1997; Edwards 1989; Todaro and Smith 2003: 571). This ...
... (Frenkel 2004), and less risk of capital flight and currency crises (Crystal 1994; Kaminsky et al 1997). However, the majority of developing states have kept their real exchange rates at overvalued levels for most of the postwar period (Huizinga 1997; Edwards 1989; Todaro and Smith 2003: 571). This ...
will there be deflation and current account surpluses?
... decisive in avoiding such a monetary policy stance. Output Gap In the absence of any demand-side shocks in the future, the negative output gap changes will be further small and have a relatively marginal influence on core inflation. However, sooner or later, the output gap will close, so that the ne ...
... decisive in avoiding such a monetary policy stance. Output Gap In the absence of any demand-side shocks in the future, the negative output gap changes will be further small and have a relatively marginal influence on core inflation. However, sooner or later, the output gap will close, so that the ne ...
NBER WORKING PAPER SERIES INFLATION REPORTS Eric M. Leeper
... used to generate the forecasts reported in the Report. This leaves open the question: exactly how are the forecasts generated? This question may well be addressed by a variety of supporting documents, some published in Economic Reviews, some published as downloadable files on the respective web page ...
... used to generate the forecasts reported in the Report. This leaves open the question: exactly how are the forecasts generated? This question may well be addressed by a variety of supporting documents, some published in Economic Reviews, some published as downloadable files on the respective web page ...
Bond markets
... greater yield than bonds higher ratings. If an agency lowers it ratings on a bond that has already been issued, the bond’s price will fall. Ratings have increased in importance because of the growing number of bonds with step up and acceleration provisions. Under a typical step up, a bond might be i ...
... greater yield than bonds higher ratings. If an agency lowers it ratings on a bond that has already been issued, the bond’s price will fall. Ratings have increased in importance because of the growing number of bonds with step up and acceleration provisions. Under a typical step up, a bond might be i ...
Central banks and financial crises
... objective function can be interpreted as symmetric between price stability and real economic activity, in the sense that, in the central bank’s objective function, the one can be traded off for the other. This is captured well by the traditional flexible inflation targeting loss function Λ shown in ...
... objective function can be interpreted as symmetric between price stability and real economic activity, in the sense that, in the central bank’s objective function, the one can be traded off for the other. This is captured well by the traditional flexible inflation targeting loss function Λ shown in ...
Market Value of the Firm, Market Value of Equity
... how much the firm borrows) but gross profit does not. Equation (1) and equation (2) always have the same result due to the key point that gross profit is independent of capital structure. That is what MM proved: market value of the firm is independent of capital structure. Equation (1) and equation ...
... how much the firm borrows) but gross profit does not. Equation (1) and equation (2) always have the same result due to the key point that gross profit is independent of capital structure. That is what MM proved: market value of the firm is independent of capital structure. Equation (1) and equation ...
Interest rate
An interest rate is the rate at which interest is paid by borrowers (debtors) for the use of money that they borrow from lenders (creditors). Specifically, the interest rate is a percentage of principal paid a certain number of times per period for all periods during the total term of the loan or credit. Interest rates are normally expressed as a percentage of the principal for a period of one year, sometimes they are expressed for different periods such as a month or a day. Different interest rates exist parallelly for the same or comparable time periods, depending on the default probability of the borrower, the residual term, the payback currency, and many more determinants of a loan or credit. For example, a company borrows capital from a bank to buy new assets for its business, and in return the lender receives rights on the new assets as collateral and interest at a predetermined interest rate for deferring the use of funds and instead lending it to the borrower.Interest-rate targets are a vital tool of monetary policy and are taken into account when dealing with variables like investment, inflation, and unemployment. The central banks of countries generally tend to reduce interest rates when they wish to increase investment and consumption in the country's economy. However, a low interest rate as a macro-economic policy can be risky and may lead to the creation of an economic bubble, in which large amounts of investments are poured into the real-estate market and stock market. In developed economies, interest-rate adjustments are thus made to keep inflation within a target range for the health of economic activities or cap the interest rate concurrently with economic growth to safeguard economic momentum.