Questions tagged [macroeconomics]
Macroeconomics is a branch of economics dealing with the aggregate economy as a whole, rather than individual markets.
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Confusion between Balanced Budget Multiplier and Autonomous Expenditure Multiplier calculation
I encountered a question regarding the simple Keynesian model, and I am confused about which specific multiplier is being requested and how to derive it.
The Problem:
In the Keynesian model, if an ...
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Effect of technological progress (halved labor requirement) in a Simple Keynesian Model
I am trying to solve a question regarding a technological shock in a Simple Keynesian framework. I am confused between the Neoclassical supply-side intuition and the Keynesian demand-side logic.
The ...
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In the High Powered Money equation ($H = C + R$), does $R$ include Vault Cash, and how does a deposit affect $H$?
I am studying the concept of High Powered Money (also known as the Monetary Base), often defined by the equation:
$$H = C + R$$
Where:
$H$ = High Powered Money
$C$ = Currency with the public
I have ...
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Would a variable mandatory-savings policy be an effective alternative to interest-rate hikes for reducing consumer demand?
I’m not an economist, but I’ve been thinking about how monetary policy works in an environment where most mortgages are now on fixed rates. For example, in the UK roughly 88% of mortgages are ...
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Why is the growth rate of potential GDP fairly constant over time?
I remember reading in my macroeconomics textbook that investment is very procyclical. Wouln't this mean that during booms production capacity increases much more quickly than during recessions, and so ...
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Questinioning the assumption, that high inequality is responsible or the only factor for low prosperity
In germany, a lot of left-leaning (I am myself left) commentators or activists go on TV and say, they want rich people to give away a chunk of their money and they always repeat "High inequality ...
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What data should I collect to see which growth model (Solow Swan, Romer, or Lucas) best fits the US economy?
I’m an undergraduate practising collecting data and testing long-run growth models using EViews, focusing on the United States to see which model (Solow Swan, Romer, or Lucas) best fits the data and ...
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Can this simple model illustrate Keynes’s idea of aggregate demand and supply?
I’ve been trying to understand Keynes’s ideas of aggregate demand and supply in very concrete terms. To help myself think it through, I built a very simple example.
I’ve written up the short piece on ...
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Why do governments seem committing everything to avoid a bankruptcy?
Here I understand under "state bankruptcy" that the government can not (won't) repay expired state bonds.
Being souvereign over its own territory, they can do it.
With it, people having ...
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How do economists define productive vs non-productive (or waste or bad) economic activity?
This question is motivated by the views of Milton Friedman regarding that many government jobs are non-productive; I think he likened them to hiring people to dig holes and filling them again. It is ...
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Can rounds of deleveraging by banks lead to an avalanche of selling?
In a recent paper by Cont and Schaanning "Fire Sales, Indirect Contagion and Systemic Stress Testing", we see systemic risk emerge from banks facing a shock to their portfolios, and so they ...
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Foreign investment doesn’t equal growing foreign assets?
The gross national income = consumption + domestic investment + foreign investment + net exports. Net exports equal the contribution to the foreign assets. If the net exports are 0 then by definition ...
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NIIP accounting of QE programs
How does bond buying programs by central banks is reflected in the country's NIIP? The NIIP would deteriorate if foreign investors bought a country's debt instead of its central bank right? Is, then, ...
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Questions about the Markov-switching mean–variance component model
I'd like to ask for your help.
I wanted to know if my code, which attempts to replicate the model proposed by Doornik (2013), is correct and consistent with the Markov-switching mean–variance ...
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Bank of ireland article implying the economy is overheating before or at full employment?
In this article explaining overheating in an economy, they say
"One element of this is the concept of "full employment", which occurs when almost everyone who wants to work has a job&...
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