Community Digest

Top new questions this week:

Auction theory reference request

I am interested in finding the literature or at least some references (books, journal papers etc.) for the following problem: Suppose there is an auction with one seller and one buyer. The seller ...

reference-request auctions mechanism-design  
asked by johnny09 2 votes
answered by Rumi 1 vote

What happens to interest rates when they are already at (near) zero and the stock market crashes?

Let's say the global stock market crashes in the coming months (it's currently at an all time high in the western world). What happens to interest rates? "Usually", as I understand from my absolute ...

interest-rate stock-market  
asked by Elon Musk 2 votes
answered by 1muflon1 1 vote

What is the purpose of multiple regression?

For instance, consider the following regression equation $College Score=\beta_0+\beta_1HighSchool GPA+u$. We interpret this $\beta_1$as the effect of a higher High School GPA holding all other ...

asked by Chenli Zhou 2 votes
answered by 1muflon1 3 votes

Utility theory and portfolio optimization: utility of what exactly?

In finance, a common problem is selection of an optimal portfolio given some constraints (e.g. budget constraint and perhaps nonnegative allocation constraint). One can define the optimization problem ...

utility finance portfolio-theory  
asked by Richard Hardy 1 vote
answered by M3RS 3 votes

What limits central banks from setting highly negative interest rates?

What limits central banks from setting highly negative interest rates if needed? Is it only that people can take out a lot of cash and put it in a vault, or are there other reasons? If we had removed ...

monetary-policy interest-rate  
asked by JonT 1 vote
answered by 1muflon1 0 votes

Business climate data collection experiments

Hernando de Soto in his book "The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else" describes a series of experiments in different countries, illustrating economic ...

data-request history-economic-thought  
asked by Sergei Akbarov 1 vote

What problems arise when the minimum wage is directly linked to the inflation rate?

For example if the minimum wage is 10, and the inflation for the year is 3%, then next year the minimum wage is 10*1.03 =10.30. the next year, inflation is 5%, so the minimum wage becomes 10.82. The ...

inflation minimum-wage real-analysis  
asked by tuskiomi 1 vote

Greatest hits from previous weeks:

Can one Calculate Fixed and Variable Cost From TC and Quantity Alone?

I have been asked a question and believe there is a mistake in the problem. I have been given a table of values, Quantity and corresponding Total cost. From those numbers I can easily calculate the ...

microeconomics cost  
asked by roccosaxman 1 vote
answered by Elias 7 votes

Car prices haven't changed in 20 years, no inflation?

I notice that there seems to be little or no change in car prices over the last 20 years and they seem to be unaffected by inflation. For example, a Toyota Camry sold for about \$23,000 +/- \$2,000 ...

inflation price united-states  
asked by Lassie Fair 17 votes
answered by EnergyNumbers 23 votes

When do supply and demand curves shift?

Let's assume that the price of apples has risen and that the quantity of apples sold during the last couple of weeks has decreased. From that, we can infer that the supply curve must've shifted to the ...

asked by LesPaul 10 votes
answered by RegressForward 6 votes

Why can't a country print its own money to spend it only abroad?

If a country prints money and distributes it between the people, it causes inflation. But what if a country prints its own money to spend ONLY abroad, which would allow a country to buy whatever it ...

asked by Dylan Zammit 15 votes
answered by Samvit Agarwal 37 votes

Effect of lower Government spending on Loanable Funds Market

I'm having trouble with understanding what the results would be... Let's suppose the situation where the newly formed government act to cut government spending and, by doing so eliminate the ...

macroeconomics government-spending  
asked by James Smith 4 votes
answered by Ian Brigmann 1 vote

Why are imports subtracted from GDP?

GDP is a measure of a country's production. $$GDP = C + I + G + X_n$$ $C$ = Consumer Consumption $I$ = Gross Investment $G$ = Government Expenditures $X_n$ = Exports - Imports Exports are what we ...

gdp international-trade  
asked by user2738698 7 votes
answered by Arthur Tarasov 14 votes

Difference between merchandise trade and trade in goods?

What is the difference between merchandise trade and trade in goods? Are they the same? If so, would total trade be just trade in goods + trade in services, aka merchandise trade + trade in services?

asked by Viv 3 votes
answered by emeryville 3 votes

Can you answer this question?

Shortcuts for elasticity of substitution

How can I find the elasticity of substitution (I know the definition) if I know the utility function $u(x,y)$? I know its increasing in $x$ and $y$, etcetera, and has everything else you want from a ...

mathematical-economics utility consumer-theory  
asked by vroompie 1 vote
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