All Questions
Tagged with macroeconomics microeconomics
243 questions
3
votes
1
answer
94
views
Solow residual with cost minimization, calculus (Roeger, 1995)
I am trying to get a good understanding of the steps involved in solving the dual of a maximization problem, namely cost minimization. At some point (last two steps), the author ends up with the ...
- 175
3
votes
2
answers
109
views
Is real income the same as present value of income?
For example, if I know in time period 2 I will get paid £x in real terms
Where the real interest rate of borrowing and lending is r% between period 1 and 2
Is this the same as being paid £x/(1+r) in ...
- 31
3
votes
1
answer
2k
views
Basic microeconomics: supply, demand and substitutes in production
The question is: explain the change in the market for skim milk, if demand for ice cream rises.
I'd say these two are unrelated in consumption (saying they're substitutes is kind of stretching it), ...
- 31
3
votes
1
answer
59
views
Comparative Statics - Capital Augmenting Technological Change
I am reading the article by Acemoglu and Restrepo (AEA Papers and Proceedings, 2018) and have encountered some difficulties deriving equation (1). I hope you can help me work through it.
The aggregate ...
- 319
3
votes
1
answer
124
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Remittance: Migrant workers sending money to their families
I wonder about the role of migrant workers in a general economic context.
Migrant working appears all over the world and on many time and space scales:
around cities (e.g. commuters)
inside ...
3
votes
1
answer
43
views
What data/factors/attributes do the professionals monitor in a top-down analysis on the macroeconomics?
I am learning to do top-down analysis on a number of sectors in the US equity markets. I have never done it before and I would appreciate it if some professionals can share their experiences with me.
...
- 31
3
votes
2
answers
2k
views
Difference between frictional unemployment and seasonal unemployment
Julie spent the entire summer of 2007 working for a tree planting company in Central British Columbia. At the end of July, her contract ended because of weather conditions. She spent the month of ...
- 31
3
votes
0
answers
29
views
Economic trade-offs of rooftop solar
It’s a well known problem that rooftop solar drives up electricity prices for non-rooftop solar consumers. This has resulted in some advocates favoring utility scale solar.
Just today the Washington ...
- 131
3
votes
0
answers
209
views
Unit cost function for CES
You do not need to make computations, you can just tell me how to make the following derivation:
I'm studying a paper where the unique final good of the economy is produced according to the following ...
- 277
3
votes
1
answer
112
views
Macroeconomics v Microeconomics
Microeconomics concepts greatly help us to understand the broad aggregates which are used in Macroeconomics to understand the overall functioning of an economy but are there any ways in which ...
- 111
3
votes
1
answer
746
views
Insurance and Hirshleifer effect
I am trying to understand the statmement that 'public information kills insurance opportunity' -- referred to as Hirshleifer effect. Does it (in general) lead to some undesirable outcomes? Could you ...
- 167
3
votes
0
answers
83
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Transportation models in economics
How would one go about modelling the effectiveness of public transportation? More specifically how does one go about comparing two transit systems in terms of their ability to move a larger numbers of ...
- 8,847
3
votes
1
answer
590
views
Return on Assets vs Return on Investment [closed]
1) Is Return on Investment same as Return on Assets?
There are so many different definition in books so I am now confused...
2) Is ROA = Profit before taxes/Total Assets or Profit after taxes/Total ...
- 153
2
votes
1
answer
316
views
Quadratic utility: monotonicity and risk aversion
I am taking macro class this fall. One of the problems asks whether decreasing absolute risk-aversion and ever-increasing consumption are two unattractive implications of the quadractic utility ...
- 95
2
votes
2
answers
474
views
CRS assumption in Solow model
Can you explain why does Solow growth model assume "constant returns to scale"?
- 131
2
votes
2
answers
239
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Is it possible to give, in economics, an example of a relation ( set of ordered pairs) that is not a function?
In mathematics, some relations ( sets of ordered pairs) are not functions.
I know economists make use of functions.
But do they also consider relations that are not functions.
In which branch of ...
user21865
2
votes
1
answer
118
views
Present Value of flow of profits with constant interest rate
I'm studying Schumpeterian Models of Quality Ladders from the Barro's book (Ch.7).
I have problems in getting the derivation of equation $(7.13)$ as follows
The basic idea of those models is: when an ...
- 430
2
votes
1
answer
103
views
Subjective discounting factor in the utility function
Consider the following utility function in an infinite time-horizon set up:
\begin{equation}
U= \int_{0}^{\infty} e^{-(\rho-n)t}u(c(t)) dt
\end{equation}
Why we assume that $\rho >n$, where $\rho $ ...
- 319
2
votes
2
answers
144
views
Maximization of CD production function
I was reading the paper "Optimal Investment Under Uncertainty" (Abel, 1982). At one point the author addresses the following problem:
$$\max_{L_{t}}\left\{ p_{t}L_{t}^{\alpha}K_{t}^{1-\alpha}...
- 175
2
votes
2
answers
619
views
How to efficiently study and learn Economics?
I read there are a couple of questions asked in this regard, but I am not quite satisfied with the provided answers.
I am currently doing my master's degree (expecting to pursue a PhD) in Economics, ...
- 343
2
votes
1
answer
3k
views
Are there any real world examples of potential Pareto improvements?
Professor George Fallis in his book "Housing Economics" writes when discussing the notion of a Pareto improvement
(Page 123)
In the real world, almost all policies recommended by economists ...
- 889
2
votes
1
answer
971
views
Recent economics theories that involve differential topology?
The original development of general equilibrium theories involved differential topology.
I wonder if there are any recently developed theories, in any field of economic theories, that utilize ...
- 2,084
2
votes
2
answers
117
views
Theory about supply of money, prices, and output?
"In theory, we should have enough money in an economy so at current prices we can buy all of the goods and services the economy is producing. What economic theory does this remind you of?"
On a ...
- 33
2
votes
1
answer
635
views
- Economics 101
Is it possible to learn economics while studying math? If possible what books do you recommend? I'm looking for books that teach the fundamentals and explain them without any use of mathematics.
- 21
2
votes
1
answer
139
views
Properties of Multivariate Frechet Distributions
I was reading an answer from another Economics Stack Exchange post and I had further questions.
The highest up-voted answer here utilized two properties of multivariate Frechet distributions, but the ...
- 23
2
votes
1
answer
123
views
What is the frisch elasticity and its meaning?
I understand that Frisch elasticity is the "elasticity of hours worked to the wage rate".
I wonder why then we use this specific naming only for this?
Is this to make it clear what this ...
- 21
2
votes
1
answer
298
views
Reductionism vs emergentism in economics
Is economics reductionism or emergentism ?Reductionism is the idea that knowledge at a higher level can be deduced from the entities and their interaction at a lower level.Emergentism rejects ...
- 137
2
votes
1
answer
177
views
How will world economy run when we run out of oil reserves?
Oil is a significant component of world's economy. Various wars have been allegedly fought over oil. But, it is a limited natural resource. Our standards of living have gone up, thanks to ...
- 131
2
votes
1
answer
75
views
Constant Elasticity of Substitution (non-special cases)
I am trying to better understand the CES function:
$$Y_{t}=C\left[\pi\left(A_{t}^{K} K_{t}\right)^{\frac{\sigma-1}{\sigma}}+(1-\pi)\left(A_{t}^{L} L_{t}\right)^{\frac{\sigma-1}{\sigma}}\right]^{\frac{...
- 23
2
votes
2
answers
91
views
How to deal with misspecification of models in Macroeconomics?
I'm wondering what methods are used in economics, specially in macro, to deal with model misspecification.
I've already searched the web, but I may be missing some methods. Therefore, I ask you for ...
- 5,121
2
votes
1
answer
510
views
Why slope is constant in demand/supply curve?
I was reading Mankiw and it showed variation of demand/supply curve with external factors. However, in all the cases the curves only shifted but didn't change in shape. What I am wondering is why the ...
- 123
2
votes
1
answer
86
views
Indirect Impacts Of The Netherlands Cutting Greenhouse Emissions?
On 24 June 2015, the Dutch District Court in The Hague ruled that the government must put policies in place to deliver, by 2020, cuts in the country's greenhouse gas emissions of at least 25%, ...
- 163
2
votes
1
answer
67
views
What is the "Arrow's generalized impossibility theorem" noted by Robert Wilson?
I recently read a note on "Arrow's generalized impossibility theorem", claiming that we don't need the pareto principle.
https://www.sciencedirect.com/science/article/pii/0022053172900518
I ...
- 2,084
2
votes
1
answer
84
views
what to learn to write a comprehensive strong paper?
to write an excellent comprehensive paper, what topics and techniques must an economist learn? One of my former professors wrote a paper I read, there are theories, calculations, and empirical tests. ...
- 23
2
votes
1
answer
153
views
Frameworks and models in economics
A framework is not a model of a specific system,
but a way of formulating and studying a
variety of systems. Classical mechanics,
quantum mechanics and statistical mechanics are all really frameworks. ...
- 137
2
votes
1
answer
438
views
How would a perfectly competitive industry respond to a macroeconomic demand shock in the long run?
In microeconomics, we are taught that in a perfectly competitive industry, the long-run industry supply curve is horizontal. This is because new firms would enter or exit until the profit is driven to ...
- 480
2
votes
1
answer
98
views
How to interpret risk premium
I do not understand the notion risk premium. Let us suppose that John goes to the city by car, but he is thinking about not paying for the parking. If he is caught in the act he must pay the fine. How ...
- 131
2
votes
1
answer
53
views
By buying stocks, am I as an individual measurably affecting the economy?
I know that participating in an IPO is directly helping the company, because my money is going straight into their bank account. I know that the stock market as a whole has an effect on the economy. ...
2
votes
2
answers
88
views
Can I make this assumption about the utility function?
My question concerns a household's utility function U(c,l). We're told that the partial derivatives dU/dc and dU/dl > 0, and the second order partial derivatives are negative. Now, can I assume ...
2
votes
1
answer
123
views
RBC model and indivisible labour
First of all, I would like to apologise for the fact that I will include a link in my question rather than a direct question, however, I have no idea how to do it in a different way.
I have been ...
- 155
2
votes
1
answer
95
views
How to define the natural rate output
I'm following Woodford's Interest & Prices to derive the microfundations for a New Keynesian model with staggereed prices.
I defined the utility function and disutility function (1.1 at page 144) ...
2
votes
1
answer
56
views
Have I found the correct Emission Price
Let's say that there is a hotel owner $(H)$ and a woodworker $(W)$ working in close proximity to one another.
The woodworker produces $x$ units to sell at market at $p_{x}=6,5$. From the woodworking ...
- 147
2
votes
1
answer
1k
views
Best micro/macroeconomics books [duplicate]
Does anyone of you could recommend me some good Macroeconomics and Microeconomics books based on your personal experience. I am an engineer and I do not have a background in Economics. I am planning ...
- 21
2
votes
1
answer
26
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What are the Impacts on an economy when a large mining venture begins to reduce production and lay off workers in a remote region?
I am currently unsure about how such a question above should be answered. To clarify , I am confused as of which topics relating to the question i should discussion in order to answer it. (For ...
- 21
2
votes
1
answer
419
views
Tax wedge in labour market
I'm reading a book ( Macroeconomics - Institutions, Instability and the Financial System ) and on page 62, the authors define tax wedge as the "difference between the real consumption wage and the ...
- 5,121
2
votes
1
answer
213
views
What are alternatives to lottery that would create same economic impact?
Lotteries can be detrimental to a subset of society since people who often play dont understand stats and that for most part lottery is negative expected value. However, taxes (and portion of ticket ...
2
votes
1
answer
91
views
How to determine the worth of a good
I've searched around the web for awhile now and I'm beginning to think this might be an unanswerable question. I want to know if there is a theoretical way to determine the worth of a particular good, ...
- 23
2
votes
2
answers
206
views
Does price affect quantity or vice versa?
On nearly all graphs found within economics textbooks, quantity is label on the x-axis and price on the y-axis, implying that the quantity supplied affects the price. Is this really so? Intuition ...
- 125
2
votes
0
answers
275
views
Solow Model - speed of convergence
This is a question also for those with a good expertise in micro. For micro guys who wanna go streight to the question, just jump to equation $(1)$
I'm studying the Solow growth model.
Let's write the ...
- 277
2
votes
0
answers
47
views
Show mathematically that in a competitive market, a price-taking firm has a zero profit. Also, justify the assumption that there is only one firm
Consider a firm that has a production function given by $F(x)$, where $x \in \mathbb{R}^n_+$. Assume that the function $F$ is strictly increasing in each argument, concave, twice continuously ...
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