Questions tagged [macroeconomics]

Macroeconomics is a branch of economics dealing with the aggregate economy as a whole, rather than individual markets.

Filter by
Sorted by
Tagged with
0
votes
0answers
49 views

Solving for value function (non-Bellman)

I am trying to build a model and am having trouble getting a closed form solution for this value function: $$V(h_{t})=\max\limits_{{k_{t+1},\tau_{t},l_{2},I}} ln[w(h_{t})[1-l_{2}-\alpha I]-k_{t+1}-\...
-1
votes
1answer
26 views

How to calculate velocity of money when some people make long-term savings?

Bob gets paid every month and lives paycheck-to-paycheck, so for Bob's money velocity is 12 (assuming that there is nobody else in the economy). Al gets paid every two weeks and lives paycheck-to-...
2
votes
0answers
33 views

Log-linear version of current account equation

I am working on my thesis, doing a two-country model with traded and non-traded goods considering incomplete asset markets and imperfect pass-through. In a sense, I am following Benigno & ...
0
votes
0answers
28 views

Forecasting integrated variables in a macroeconomic setting

I am trying to measure the effects of restrictions on immigration to a specific country on both real estate rental indices and real estate property price indices during the next 3 to 5 years. As a ...
0
votes
0answers
20 views

What happens to Interest rate if the money supply is fixed?

With the increase in Money supply, the nominal interest rate tends to increase. But what happens if the supply of money is fixed? What happens to the Interest Rate?
0
votes
0answers
18 views

Fed vs Treasury: 2008

Re-visiting the issue of the Troubled Assets Relief Programme (https://www.thebalance.com/tarp-bailout-program-3305895), both the Treasury and the Federal Reserve had a role to play in the "bailout". ...
0
votes
0answers
32 views

Are there automatic stabilizers that react with contraction to a stagflation?

So far I know only two automatic stabilizers, namely "progressive tax system" and "unemployment benefits". Both of them would react expansionary to stagflation. During stagflation incomes of people ...
0
votes
0answers
33 views

After a permanent shock what would happen to the interest rates?

If there was a permanent negative population shock that reduced the population of the young by x. What would happen to interest rates under an OLG model?
0
votes
0answers
25 views

Export is high sensitive to external income. How can be this explained?

I am estimating an export equation, where dependent variable is export and independent variables are exchange rates, external income and other controls. Each coefficient is an elasticity. The results ...
1
vote
1answer
68 views

An overview of 4 books for an undergrad course in Mathematical Economics

I plan to self-study, at an undergraduate level, Mathematical Economics. There's 3 main topics to cover Introduction to economy science Microeconomy Macroeconomy (each of these have lots of sub-...
0
votes
1answer
34 views

Why is a nations economy is divided into sectors?

I understand that modern economists divide a nations economy into sectors such as such as primary, secondary, tertiary, quaternary and quinary. What is the point of such classification?
0
votes
0answers
18 views

(AD-AS model) How is it possible for firms to spend less, but supply more at higher price level, assuming no increase of the SRAS?

According to the interest rate effect theory higher prices will lead to lower GDP demanded because firms will spend less due to loans being more expensive. It seems at odds with what the SRAS curve ...
0
votes
1answer
33 views

Log-linearization of real exchange rate

I have a doubt on how to log linearize an expression for the real exchange rate. I have read in several papers that they express it using substitutions. I haven't been able to find out what ...
0
votes
1answer
52 views

Is there an “ideal” ratio of tax revenue to GDP? Or, at least, can I assume a higher ratio is better?

At the link below, you can see countries have a huge difference in ratios of tax revenue to GDP. Is it fair to assume that a higher ratio is better? Does raising a substantial portion of your GDP in ...
0
votes
0answers
20 views

Does fiscal policy always shift the AD more than the SRAS?

I noticed that when I read about fiscal policy and the AD-AS model, it looks implicitly assumed that when we use fiscal policy we intend to shift the AD, even when the economy experienced a negative ...
1
vote
2answers
53 views

What would be the likely economic consequences of the “trillion dollar coin” idea to eliminate all government debt?

Taken from this question over at politics.se, consider this article by Business Insider which describes a scenario in which the treasury mints a trillion dollar coin to pay off all the debts of the U....
0
votes
1answer
32 views

Is there any metric to measure the creation of products and services needed to sustain and expand life?

I was thinking about the value of those products and services which are needed to sustain people's lives and to expand people's lives, and how unaware I'm of a metric that measures actually this. I ...
0
votes
1answer
21 views

Log-linear version of the uncovered interest rate parity

I am trying to derive the log-linear version of the uncovered interest rate parity under complete asset markets. I know that the UIP condition is given by $$(1+i_t)=(1+i^*_t)\frac{S_{t+1}}{S_t}$$ I ...
1
vote
1answer
64 views

MPC and MPS relationship

I have a question from an old assignment that I cant wrap my head around. ...
0
votes
0answers
13 views

Technical Term for “Dead Economy” Without Funds in System

I'm looking for a technical term or phrase to describe an economy in which there isn't cash to spend in it. I believe I read a book that referred to that state as a "dead economy" however from doing ...
0
votes
1answer
77 views

Why do expectations of inflation decrease SRAS (Short Run Aggregate supply)?

If firms and workers expect the prices to rise, the short run aggregate supply will shift to the left to SRAS2. (https://www.albert.io/blog/what-shifts-aggregate-demand-and-supply-ap-macroeconomics-...
0
votes
0answers
42 views

China's GDP is seven times larger than during the SARS outbreak — what's the implication for China?

I have been compiling some figures to compare China's macro conditions in 2003 and 2019. Clearly, much has changed in nearly twenty years. In particular, a few indicators really stand out. For ...
0
votes
0answers
11 views

Is it better to calculate inflation rate using GDP deflater whether based year is the first year or last year of our data?

if we wanna calculate inflation rate for years 1997 and 1998, there are 2 ways, first is set our base-year 1997 and according to my data it will be 0.39 and if we set the base-year 1998 the rate will ...
0
votes
0answers
18 views

Equilibrium in currency devaluation?

In export oriented Economy, we often come across currency devaluation as means to boost exports. As per my understanding (please correct me if I am wrong), currency devaluation will immediately bring ...
1
vote
2answers
36 views

How to interpret fixed effect regression R-sq. results for panel data?

I runned a fixed effect regression in Stata (xtreg, fe) for panel data. I obtained below R-sq. results. How should I interpret them? Which one is my main interest(within,below or overall)? How can I ...
-2
votes
1answer
93 views

Is there any widely accepted downsides for Cuban system?

The Cuban political, social and economic systems under communism are known for having a good medical system and high quality medical workers. Cuba also has a good educational system. The country also ...
1
vote
0answers
27 views

Considering existence of firms with sticky prices of goods, why are we sure that SRAS will be upward slopping?

One of theories that explains why the SRAS is upward slopping is the theory of sticky prices. For an example, suppose there is inflation. In the short run it will take different time for firms to ...
1
vote
1answer
28 views

Liquidity Trap Question? Return to equilibrium

As far as I inderstand a liquidity trap occurs when increasing the money supply is not able to stimulate the economy because people prefer hoarding the cash rather then investing in debt securities ...
0
votes
1answer
30 views

How will economy find long-term equilibrium in AD-AS model in case of a negative supply shock?

Let's suppose that negative supply shock happened that affected SRAS, but not LRAS. Let's also assume that previously there was long-run equilibrium at point $A$. Due to negative supply shock SRAS ...
1
vote
2answers
53 views

Do reserves at Bank of Canada count as money?

I read the following three statements concerning M1 and M2 in Canada: a) "M1 consists of currency held outside the banks and chequable deposits of individuals and businesses." b) "M1 does not ...
5
votes
1answer
115 views

Is there a reproducibility crisis in Economics?

I am an undergraduate economics student, and came across this paper by John Ionnadis on 'The Power of Bias in Economics Research'. the findings are quite bleak. https://academic.oup.com/ej/article/...
0
votes
1answer
21 views

Falling Real Wages

Economist Lester Thurow said, "It used to be that if you were an American and relatively unskilled, you got an American premium, cause you'd work with more raw materials, better capital, better ...
0
votes
1answer
18 views

What does the vertical axis of the Kuznets curve depict (mathematically)?

I do not understand what does the word "inequality" means on the vertical axis of the Kuznets curve. Can someone please explain?
2
votes
4answers
55 views

Does Efficient Market Hypothesis make anticipated monetary policies useless?

Since the market perfectly captures all the information, is it true that any anticipated monetary policy has no impact on equity prices? Or the “information” has an immediate impact but the “event” ...
0
votes
1answer
23 views

How are PPP, nominal exchange rates and inflation related?

This Forbes article discusses how changes in the market exchange rate can be used to estimate an inflation rate thanks to the principle of purchasing power parity (PPP). Can someone distill this ...
1
vote
0answers
51 views

Transversality Condition

I am reading the first section of chapter 10 of the Obstfeld and Rogoff textbook Foundations of International Economics and I have a doubt in how the transversality condition is obtained. Even though ...
9
votes
4answers
2k views

Macroeconomics for Mathematicians

I'm coming from a math background (so my mind is set up for Definitions-Observation-Lemma-Proof frameworks) and looking for recommendations of a Macroeconomics textbook mainly devoted to growth models ...
0
votes
0answers
16 views

Monetary Theory Money Model Help

the following is a monetary theory overlapping generations model question and I wonder whether I have the correct answer. Can someone please let me know? Thanks! Question: Suppose there is a fixed ...
3
votes
0answers
24 views

How to interpret the sum of company revenues?

The introduction to the Fortune 500 states: In total, Fortune 500 companies represent two-thirds of the U.S. GDP with $13.7 trillion in revenues. I checked, and this is indeed the sum of those 500 ...
0
votes
0answers
19 views

To what extent did tsetse fly affect African development today?

Based on the fact that the insect is unique to African ecology and its impact both on humans and livestock, can it be argued that the lag of Africa's development today is at least partially due to the ...
0
votes
0answers
11 views

Does filling the spot of a retiree count as a job created?

When a person retires, and the company hires someone to fill the job of the person that retired, does that count by the BLS(Burea of labor statistics) as a "created job"?
1
vote
2answers
30 views

How to estimate Robot density in a country?

I'm writing a thesis where a key element is the degree of automation (for Switzerland) through time. I was counting on the IFR to get those data but I need to pay 2000k to get them... Does anyone ...
1
vote
1answer
56 views

How does an increase in the minimum reserve requirement affect the monetary base?

Monetary base is defined as currency+currency held by banks+deposits of banks at central bank. We assume that the current reserve is below the minimum reserve requirement. Which component of monetary ...
1
vote
1answer
26 views

Understanding GDP vs Real GDP

I am totally new to Economics. I have issues understanding GDP and real GDP. I have listed 3 statements below, can someone tell me if those makes sense ? GDP Gross Domestic Product is used to get an ...
4
votes
0answers
55 views

Combining functions that satisfy the Inada conditions

Suppose $f: \mathbb{R} \to \mathbb{R}$ and $h: \mathbb{R}^n \to \mathbb{R}$ are functions that satisfy the Inada conditions, and also $$ \forall i: \lim_{x_i \to \infty} h(\mathbf{x}) = \infty. $$ ...
2
votes
0answers
29 views

Who was the first to model sequential market equilibrium?

As a PhD student the standard macroecononomics education I have received (and continue to receive) revolves around the most realistic model of market structure ive seen to date, that being sequential ...
6
votes
3answers
147 views

List of production functions that satisfy the Inada conditions

It is known that in the class of CES production functions, only the Cobb-Douglas production function satisfies the Inada conditions. Which other functions satisfy the Inada conditions?
-2
votes
1answer
26 views

Steady state growth of output

In the long run Solow steady state, the growth rate of output in a country is g + n. If there is some other country with exactly the same properties of the first country and the same initial ...
2
votes
0answers
21 views

Is there a list of U.S. government regulations or actions that depend on government produced statistics?

I'm interested in compiling a list of government actions that depend on government produced figures. For example social security benefits depend on the CPI. I don't know if such a list already exists.
1
vote
0answers
28 views

Non-traded goods in Two Country New Keynesian Model

I am working on a two-country New Keynesian model, where I include traded and non-traded goods. The final good is produced using traded and non-traded inputs: $$ Z_t=\bigg[a^\frac{1}{\kappa}Z_{T,t}^{\...

1
3 4
5
6 7
41