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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40 views

Real time data map about the amount of a currency that are held in the world ?

Where can I see in real time data about the amount of a currency that is held in central banks (and maybe other significant places) ? A map would be great. I would like to know if there is an ...
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1answer
69 views

Timeline of comprehensive NIPA revisions

I have been fruitlessly searching for a list of dates of comprehensive National Income and Product Account revisions. Clues I have found so far: The Bureau of Economic Analysis website says the 1999 ...
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1answer
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What would be the economic effects of a reduction in the general level of protectionism on the Australian economy?

Protectionism methods including: tariffs, subsidies, quotas, local contents rules and export incentives Would would be the effects of a reduction of these methods, not complete free trade.
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Why is overlapping generation model not a main model in macroeconomics?

It seems that overlapping generation model has far more realistic assumptions than ordinary Ramsey-Prescott RBC model for use in macroeconomics. Why is Ramsey-Prescott ones, even New Keynesian ...
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1answer
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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), ...
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2answers
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Relationship between the Lagrangian and consumption euler equation?

I think that the best way for me to ask my question would be to start with an example. Suppose that consumers have a two-period horizon and their instantaneous utility is: $\:$ $U(C_{t})=ln \: C_{t}...
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1answer
60 views

Which macroeconomic issues can be considered "curable" and which can't?

I like the comparison between economics and medicine. Both study complex phenomena and both are limited in ways to run experiments (though medicine has much more freedom here). We all know medicine ...
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1answer
92 views

What impact did monetary policy actions taken during the Great Recession (2007-09) have on U.S. economic performance?

What impact did monetary policy actions taken during the Great Recession (2007-09) have on U.S. economic performance? Quantitative easing and unconventional policy actions such as asset purchases and ...
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1answer
137 views

What major monetary policy actions were taken during the Great Recession (2007-2009)?

What major monetary policy actions were taken during the Great Recession (2007-2009)? Quantitative easing and unconventional policy actions such as asset purchases and "forward guidance". I think I'm ...
2
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1answer
270 views

What impact did major fiscal policy actions taken during the Great Recession (2007-09) have on U.S. economic performance?

What impact did fiscal policy actions taken during the Great Recession (2007-09) have on U.S. economic performance? Bush passed the Economic Stimulus Act of 2008 and also the Emergency Economic ...
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263 views

What major fiscal policy actions were taken during the Great Recession (2007-09)?

What major fiscal policy actions were taken during the Great Recession (2007-2009)?
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2answers
236 views

Unlimited supply of national currency?

I was reading this article about Denmark central bank defending its currency peg: http://www.bloomberg.com/news/2015-01-22/denmark-cuts-key-deposit-rate-to-minus-0-35-to-drive-down-krone.html In it ...
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Impact of Fiscal and Monetary Policy during Great Recession on U.S. Economic Performance

What major fiscal and monetary policy actions were taken during the Great Recession (2007-2009)? What impact did they have on U.S. economic performance? I understand how how the recession occurred in ...
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3answers
1k views

Why does the profit reaches its maximum value at the equilibrium point?

When we talk about marginal cost and marginal benefit/cost, why does the equilibrium point is the most convenient for the production of a product. If the marginal cost and the marginal benefit/revenue ...
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Research on the link of QE and increased economic activity

Im looking for good literature of quantitative easing and the effects on economic actitivty. from a modelling perspective Any empirical research? What I am thinking of, is how much of an effect ...
3
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1answer
132 views

How can I solve for total money spent if I use a non-constant MPC?

Background Today in my macroeconomics class my teacher taught us three concepts. The first is very simple: consumption $c$ is a linear function of national income $y$. Mathematically, $$c = My + b$$...
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4answers
2k views

Books for microeconomics and macroeconomics for selected topics

I am a mathematics undergraduate trying to self-learn some economics. I have no background in economics. I wish to know from which chapters of Hal Varian's "Intermediate Microeconomics" (7th edition) ...
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2answers
151 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 ...
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1answer
308 views

Present value of a payment

Suppose I've just won 1'000'000 dollars in a game show. At the end of the program they tell me that they will pay me the prize as following: they will deposit in my bank 50'000 dollars every year for ...
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2answers
772 views

How is capital outflow calculated?

I would like to understand the meaning of the following phrase: Capital flight from Russia in 2014 was 151 billion dollars. First, I would like to know how such a calculation can be done. Secondly,...
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2k views

The Sonnenschein-Mantel-Debreu results, what are the implications for macroeconomics?

I have always wondered why such a negative result such as Sonnenschein–Mantel–Debreu theorem (SMD) theorem is usually ignored or disregarded by practitioners, specially in macro. The result roughly ...
2
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1answer
786 views

What is Production Possibility Frontier (PPF) diagram drawn on consumption-leisure?

When explaining basic macroeconomics model involving consumption-leisure tradeoff, often diagram showing production possbility frontier (PPF) is drawn with leisure on x-axis and consumption on y-axis. ...
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1answer
45 views

Macroeconomic formulas for global limited raw material economy exist?

Macroeconomics basic formulas are referring to a model in which the raw material are unlimited. Also the efficiency of production is a consequence of the pressure done by consumers (that buy the most ...
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1answer
261 views

How can austerity and quantitative easing happen simultaneously?

In 2010 the UK government simultaneously started an austerity program which cut public spending, taking money out of the economy, while enacting a quantitative easing program which injected hundreds ...
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5answers
909 views

What is the reasoning behind the sharp fall of oil prices starting in mid 2014?

Things I have considered: Poor economic conditions around the world could have caused an unpredicted decrease in demand. The resulting surplus has begun driving prices down. This could be ...
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2answers
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Can Dynare solve general equilibrium (GE) models with non-convex adjustment costs?

I know that Dynare (which sits on top of Matlab) can solve many kinds of dynamic stochastic general equilibrium (DSGE) and overlapping generations (OLG) models. I also know that Dynare can handle some ...
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Measuring Integrating Capital Market

There are several methods measuring integration capital market. What best to measure for integration capital market?
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1answer
144 views

What would happen if the entire world switched to the 4-day work week? [closed]

What would happen if the entire world switched to the 4-day work week? Specifically would someone's quality of life drop significantly in a developed or a non-developed country?
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1answer
499 views

Do countries invest in the country's own stock market?

For example can the government of the UK invest in some company with shares in the FTSE 100? Or can Russia take the opportunity now that the shares of oil companies are low to buy them?
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1answer
8k views

A general drought in the world, raises the total income that farmers receive?

I need to write 6-7 lines explaining why is the following statement true: ...
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2answers
2k views

Why in most macro models technology is labor-augmenting?

Take Romer's advanced macro book as reference. In it the Solow model,the Ramsey model and the Diamond OLG all contain the fundamental $A_t$ variable representing technological progress. In all these ...
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3answers
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What is the difference between intensive margin and extensive margin in labor economics?

What is the difference between intensive margin and extensive margin in labor economics, or general RBC model, where we talk about labor-hours supplied changing with extensive margin or intensive ...
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1answer
278 views

Efficient Market Hypothesis and constant ex-ante real interest rates?

According to Hayashi's Econometrics (page 151), efficient market hypothesis is a joint hypothesis combining: Rational expectations $\rightarrow$ expected inflation$= \mathbb{E}(\pi_{t+1}|I_t)$, where ...
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1answer
416 views

Liquidity trap and consumers' reaction to an increase in money supply

I've understood that when the nominal interest rate reaches the zero lower bound there is nothing that the monetary policy can do to increase the output level of a certain economy. Because $i=0$, no ...
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1answer
94 views

For linear quadratic approximation of RBC model, why does matrix $P$ of value function $V = F^TPF$ has to be negative semi-definite matrix?

In http://www.compmacro.com/makoto/note/note_rbc_lq.pdf page 5, it is said that for value function $V = F^TPF$ (Bellman equation) $P$ has to be negative semi-definite matrix. Why does it have to be ...
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1answer
498 views

Solving an OLG model, value function iteration vs. projection (chebyshev polynomial)

I can't decide between using value function iteration or projection on chebyshev polynomials. I'm inclined to use projection, however I need to compute (for welfare analysis) the value of the value ...
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2answers
256 views

Why plug deficits with bonds rather than printing money?

The UK is running a budget deficit £107 billion a year. Inflation is currently running at 1%. Given these facts, why do they plug the gap by selling debt rather than just creating the money to cover ...
6
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1answer
294 views

How is labor disutility modeled in Arrow-Debreu model?

In DSGE models, utility function contains labor disutility components. But I cannot not see how labor disutility is incorporated in Arrow-Debreu-Mackenzie model.
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1answer
52 views

Would it be correct to use exchange rates of the biggest trading partners to the dollar as an explanatory variable?

I'm trying to study the relationship of general macro factors and their effect on credit in the private sector. The country in question has a fixed exchange regime with the dollar, would it be ...
3
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1answer
178 views

Oil as a function of GDP

In Mankiw, N. (2012). Principles of Macroeconomics (6th ed.)., on pg 456 Mankiw says "The amount of oil used to produce a unit of real GDP has declined about 40 percent since the OPEC shocks of the ...
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1answer
171 views

Is special case of utility function in "Intertemporal Substitution in Macroeconomics" also a special case of a Ramsey growth model utility function?

So in RBC and Ramsey-derived utility function, the following is usually the form of utility: $$u(c,l) = c^{1-\sigma}(1 + \omega(l))$$ where $\omega(l)$ is arbitrary function of $l$, labor, that ...
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1answer
171 views

Where did Robert Lucas say "market is always in equilibrium"?

Does have anyone link to the reference where Robert Lucas said "market is always in equilibrium"?
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155 views

why is labor $h_t$ often average working time percentage of non-sleeping time in RBC?

Cobb-Douglas production is often given by $Y=AK^{\alpha}L^{1-\alpha}$, and $L$ is often just labor. But in RBC model, I notice that labor $h_t$ is restricted to $[0,1]$, and interpreted as working-...
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1answer
133 views

Does RBC models pin down equilibrium output, amount of labor and capital without initial condition?

In ordinary equilibrium models, we can pin down equilibrium quantity by supply-demand functions. Is this the same in RBC models? Can we pin down equilibrium output and amount of labor and capital ...
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1answer
122 views

The USA debt and the individual investor

There is a lot of hype about the national debt of the USA being incredibly large, and I wonder if this has any implications about an individual investor? I understand that the risk of having a large ...
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1answer
3k views

Benefits of a weak national currency

I often hear that developing economies can benefit from a weak national currency. For example China as exporter deliberately makes its national currency weaker, so that it gains an advantage. Are ...
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3answers
1k views

Has the natural rate of unemployment decreased with modern travel and the Internet?

The natural rate of unemployment is a combination of structural unemployment and frictional unemployment. Structural unemployment is caused by a surplus of labor at a given wage in a given area. ...
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1answer
8k views

Why is CRRA utility often used in macroeconomics DSGE model?

As title says, why is CRRA utility often used in macroeconomics DSGE model? That is, the form of $$u(c_t) = \frac{c_t^{1-\sigma}}{1-\sigma}$$ I cannot find any theoretical background around this........
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5k views

What has caused the recent 25% unemployment rate in Spain?

The unemployment rate in Spain has recently been fluctuating around 25%. What has caused this?
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1answer
179 views

Does Craigslist Reduce Unemployment?

If a substantial (though admittedly I have no idea how large) part of the natural rate of unemployment is caused by the job search, do more efficient means of communication create more efficient labor ...