All Questions
Tagged with macroeconomics microeconomics
243 questions
1
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0
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Is the definition of Investment variable in Economics?
I studied that Investment is the expenditure incurred on the procurement of such goods that would help us in production of goods and services.
And mainly consists of Fixed and Inventory Investment
...
- 247
2
votes
0
answers
257
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Lagrangian multiplier
Consumer's problem
\begin{equation}
\max \sum_{t}\beta^{t}[c_{t}-1/2(1-x_{t})^{2}],
\end{equation}
\begin{equation}
\ s.t. c_{t}+q_{t}b_{t+1} \leq (1-\tau_{t})(1-x_{t})+b_{t},
\end{equation}
where c=...
- 21
5
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1
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708
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Deriving average productivity from a CES production function
Following the work of Raurich et al. (2012) I got stuck trying to derive the average productivity starting from the following CES production function:
$$Y=A\left [ \alpha K^{\frac{\sigma -1}{\sigma }}...
- 175
5
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4
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376
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Explanation Rational Expectations
I am struggling understanding the concept of rational expectations. Can someone explain in simple words the concept of rational expectations? Does someone know a good (online) source explaining ...
- 53
1
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3
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135
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How to engineer the economic system, so that an individuals self interest leads to fulfilling collective interest
So it is said that Adam Smith said that self interest leads to collective interest.
This is obviously not the case. We do not have a society that maximises the collective good*.
My question is, Is ...
- 113
2
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1
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510
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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
-1
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1
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49
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Common sense of economics as reflected in proverbs [closed]
May I ask what other proverbs reflect the common sense of economics, such as those who dig for gold are not better than those who sell shovels?
What I'm talking about is that during the Gold Rush in ...
- 101
0
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1
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160
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intuitive interpretation of the marginal return/productivity of capital being less than one
Let's assume you have a production function, f, and you want to know how the output changes with respect to capital, everything else constant (ceteris paribus), so you want to know the marginal ...
- 157
4
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1
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171
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Labour Market: simple macroeconomic modeling
I just started reviewing macroeconomic modeling for an upcoming entry exam, and I'm not sure about my answers in this application:
Suppose that the economy of a country has a representative firm ...
- 237
5
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2
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237
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Research at the county-level: Macro or Micro?
Is research at the county-level considered applied micro or applied micro?
The standard undergrad definitions ("micro" = "individual", "macro" = "nation") are of no help with units of measurement ...
- 153
0
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1
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64
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How does one asses the impact of a proposed policy?
My State government is considering a new regulatory policy at the moment. We need to put together an assessment of the (likely) economic impacts of the policy. How do we do that?
I don't work for ...
- 101
0
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1
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152
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Sustainable growth in the long run [closed]
Suppose that, in addition to physical capital and labour, an economy requires a fixed factor and a non-renewable resource to produce the final good. Prove that an economy with these input requirements ...
- 63
1
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1
answer
497
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How to check whether the production function below is neoclassical or not
Say I'm given the production function of the form
\begin{equation*}
Y= F(K,L,A) = (\alpha K^{\epsilon} + (1 - \alpha)Y^{\epsilon})^{\frac{1}{\epsilon}}
\end{equation*}
Where $\epsilon, \alpha \in (0,...
- 281
2
votes
1
answer
3k
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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
5
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1
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150
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Teaching: from Microeconomics to Open-economy macro
I am a new faculty teaching MBA courses. Presently, I am teaching International Financial Management (IFM) and Macroeconomics. I have prepared the syllabus of macroeconomics based on first 9 chapters ...
- 123
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3
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298
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Macroeconomics, the circular flow of income and profits
I'm really confused about the concept of the circular flow of income. Specifically, I'm confused about the following situation:
Imagine a simple economy where households don't save their income, so ...
0
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1
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74
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Has any person ever actually planned his or her consumption according to Modigliani’s LCH?
https://en.wikipedia.org/wiki/Life-cycle_hypothesis?wprov=sfti1
It seems self-evident to me that nobody on Earth actually does this. Real people are short-sighted, undisciplined, and lack the ...
- 345
1
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1
answer
68
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Can we add well-being into macro model as an endogenous variable?
People talk a lot about well-being as an objective of macro policy (together with gdp growth). So if well-being is an objective, i'm wondering if we can add well-being into macro model as an ...
- 131
3
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2
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109
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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
2
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0
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16
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Resources for periodical economics feed [duplicate]
I'm learning economics and I want to read/hear the world through the lenses of any economist.
What are the best periodical economics news feeds?
It could
Magazines such as theeconomist.com
Podcast ...
- 21
3
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2
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2k
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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
5
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5
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276
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What are good books on economic world history?
I am trying to find a book that covers human history with a special focus on economics. It should answer questions like:
What economic systems prevailed during which eras?
How did these systems work ...
- 181
5
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1
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293
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How, with complete markets, do we have a representative agent?
I've read several texts stating that with a complete market assumption, there's always a representative agent lurking. How is it that by assuming complete markets, we're able to prove the existence of ...
- 5,121
0
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1
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136
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Why are the concepts of short-run and long-run equilibrium exclusive to aggregate supply and demand and macroeconomics?
Shouldn’t there also be a concept of short vs. long-run equilibrium in microeconomics? After all, short-run equilibrium describes the state of the economy when wages and prices are still adjusting and ...
- 345
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1
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203
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Permanent Income Hypothesis - Changes in r
I want to analyze the changes in the interest rate $r$ when dealing with the permanent income hypothesis. First of all,
$r$ is the interest rate $0<\beta<1$ is the discount factor, $Y_t$ is ...
- 281
3
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1
answer
49
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What is the general rule for classifying factor that only shift one supply/demand curve or two supply/demand curve?
What is the general rule in words/mathematical description for a factor that only shifts one supply/demand curve or two supply/demand curves simultaneously?
It is pretty confusing to me, because no ...
- 743
2
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1
answer
971
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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
1
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0
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247
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Most important but untested theories in economics? [closed]
In the opinion of the economists here, what are some of the more important theories in economics that remain untested? By untested I mean theories that, though perhaps evaluated using empirical data, ...
- 2,911
1
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0
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87
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How can I model immigration and xenophobia economically using these equations?
I'm trying to put together a toy model for immigration ($I$), labor prices ($w$), and a measure of xenophobic/nationalistic sentiment ($A$). What I've come up with so far is the following:
$$\frac{dI}...
- 11
1
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1
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118
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Cash Flow and present value Question [closed]
First: for year 0, I do not know why the cash flow = $- 1000 / ( 1 + 0.10)^0 = 909.01$
Second: for year 1, if cash flow = $30,000-5000/(1+0.10)^1 = 25 454 $
How is "Cash Flow" column useful in ...
10
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2
answers
6k
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Meaning of Additively Separable, Linear in X
Often I see both in micro and macro two common terminology :
Additively separable.
Linear in price or linear in probability.
I understand exactly as they sound by looking at the functional form ...
- 1,241
0
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2
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96
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Books on Technological Progress and Growth
I've done some google search for good, reader friendly albeit technical, books on technological progress/change and economic growth. However, I've not found what I want. If you are using or have heard ...
- 2,020
2
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1
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1k
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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
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0
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87
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Does a social welfare gain cause economic growth? [closed]
For example, if the consumption of goods with negative externalities of consumption were reduced to the socially optimum amount, thus eliminating the social welfare loss, would that directly cause ...
- 21
6
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2
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262
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Is there a comprehensive list of all market failures ever discovered?
I'm looking for a complete run down of all different kinds of market failures;
Wikipedia has a list but I'm not sure if there might some obscure kinds of market failures that Wikipedia is missing. ...
- 61
1
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0
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54
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Can the Goodwin Model of cyclical labor growth be applied in a micro context to specific industries?
I have been doing a bit of research into the Goodwin Model (1967), which generates cycles of economic activity. I understand that this is mostly used in macroeconomics. However, I am curious if this ...
- 73
5
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1
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843
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What are the most used approximations in economics?
As I progress in my self-study, I'm tired of having to search for several different approximations techniques used in economic textbooks. Sometimes the authors don't even tell the reader they are ...
- 5,121
4
votes
1
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256
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Indifference curve - Does $dU = 0$ hold in higher dimensions? / Problem of integrability
In two dimensions, we have on an indifference curve that $dU=0$.
Does this apply to indifference objects in higher dimensions?
I was thinking that if $dU > 0$, then one is moving to a higher ...
- 370
1
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2
answers
291
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What does my lecturer mean by "economic calculation"?
We got this essay question
"It is argued that economic calculation should exclusively be based on individual utility maximization but include an altruistic concern for the common good and for other ...
- 257
2
votes
2
answers
117
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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
1
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1
answer
479
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Clearly explaining the concept of "normalizing" price and relative prices to undergraduate
I am trying to clearly explain to the concept of "normalization" or relative prices. Because students are so used to just think of prices in absolute terms, it is initially tough to make the leap to ...
- 1,241
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1
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37
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Studying growth in US and Sweden, what variables should I watch out for in a regression? [closed]
I've be assigned a project on growth paradigms in US vs Sweden as part of my introductory course in econ. Can somebody please help me out with regression ideas?
1
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0
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38
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Where to start, to know the cost, in hours of work, necessary to produce one more car (or any other good)?
Let's say I want to buy a car. It costs that, so I can know that, for example, I have to work 3 months to pay for it. But does the car really needs three months of human work to be build?
What is the ...
- 111
3
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0
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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
5
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1
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270
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List of theoretical models of learning
What are the most advanced theoretical models about "learning" such as learning-by-doing or learning from others?
Overall, learning in economics spans different areas. Here there is a largely ...
- 163
-3
votes
1
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419
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What is the most successful economic prediction? [closed]
The question above is closed and unanswered. Stop dodging the question.
I am asking for one example.
Successful defined as:
Has been consistently correct for the longest number of years
Has been ...
- 1
-10
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1
answer
211
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Has anyone made a successful economic prediction more than once? [closed]
See title. Specifically it would be good to see something that proves some type of market economics and not just a simple monopoly model.
This is not too broad because I am asking for literally one ...
- 1
0
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1
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111
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price elasticity of output, makes sense?
I was wondering, in a log-log model of output, labour and commodity price where output is the depedent variable, does it make sense if the coefficient on the price variable is interpreted as the "...
- 2,020
1
vote
1
answer
41
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What is the difference between knowledge-based and R&D?
So far, I always thought that knowledge-based companies and R&D companies were the same. But recently our TA mentioned that they are different, I've searched a lot to find the differences between ...
- 113
0
votes
1
answer
3k
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Interpretation of %p.a. notation
Does anyone know the meaning of the notation x%p.a.?
I'm reading a text on seigniorage, and the authors have used that notation to state the usual empirical limit to the seigniorage revenues just ...
- 5,121