Questions tagged [multiplier]
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11 questions
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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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1
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Meaning of negative investment in the Samuelson multiplier-accelerator model?
I am studying the Samuelson multiplier-accelerator model from the book Economics with Calculus by Lovell. It's an appealing model because it is based on nothing except the national accounting identity,...
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Estimating regional economic impact multipliers with time series data
Background:
There are plenty of economic impact multipliers already floating around (output to jobs, earnings to jobs, value added to jobs, etc.). The BEA publishes their RIMS II multipliers. ...
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Econs help regarding National Income Determination Fundamentals
it isn't always a breeze trying to post something questions as my formatting is all in a mess, lmao. I need some help in the basics of NID and hope some econs experts can provide some help in ...
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Optimisation problem and KKT conditions (unsatisfied?)
I have to understand a thing about this exercise: find the minimum of $f(x, y) = (x-2)^2 + y$ subject to $y-x^3 \geq 0$, $y+x^3 \leq 0$ and $y \geq 0$.
Now, I solved the problem quite easily in a ...
- 153
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why does consumption not have a positive multiplier?
My tutor said that only $I$, $G$, $X-M$ in AD can include a multiplier and that consumption does not create a multiplier effect. I understand that these factors affect my ability to consume and that ...
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3
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2
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The marginal propensity to consume and the multiplier according to Keynes
In "The General Theory of Employment, Interest and Money", Chapter 10: The marginal propensity to consume and the multiplier, John Maynard Keynes says:
Our normal psychological law that, ...
- 175
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Why is the multiplicator effect considered stronger if money is handed out to poor people rather than the well off?
Frequently, extra handout to poor people during economic crisis is motivated by the multiplier effect. The reasoning goes something like this: since the recipients are poor they will consume the extra ...
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The case where the entire amount of investment goods are supplied by the imports
A positive investment multiplier does not exist in an open economy simple Keynesian
model when the entire amount of investment goods is supplied from import. Examine
the validity of this statement.
My ...
2
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1
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Price rigidity and demand-constrained economies
In this note, http://web.mit.edu/krugman/www/MINIMAC.html, Krugman develops a simple model to introduce the idea that whenever an economy experiences price rigidity then this economy is demand-...
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setting of Lagrangian function
Consider a simple consumer's problem:
Max $u(X)$ s.t. $\sum_i^l p_i x_i\leq \sum_i^l p_i w_i$
$w$ is initial endowment.
We can set the Lagrangian function to solve this problem.
$L=u(X)+\lambda ( \...
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