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63 views

The difference between capitalism and communism [closed]

I'm mostly a software developer, and we like to assign structures containing fields to things. For capitalism; if every thing had an owner field, an ...
0
votes
2answers
96 views

Inflation leads to loss of gold reserves

I am reading Murray's Rothbard What has government done to our money? and this is his reasoning for inflation leading to loss of gold reserves to other countries (...
0
votes
2answers
69 views

Can an appreciating currency lead to inflation?

If a currency, e.g. the rupee (INR), is appreciating against, say, the USD, it possibly means that there is a high demand for the former. India could have net exports, high remittances, increasing ...
2
votes
3answers
782 views

Opportunity profits vs. opportunity costs

Having learned that Opportunity costs = the costs for avoided profits are a well established and quite useful economic concept, I wonder how its counterpart is officially called and investigated: ...
1
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1answer
110 views

Attributing Labor Productivity Gains to Capital Deepening vs. Total Factor Productivity Growth

In a traditional Solow-Swan growth model, you can decompose growth in labor productivity (output/hour) into a component stemming from total factor productivity growth and another stemming from capital ...
0
votes
0answers
39 views

Why does LRAC not connect the minima of SRAC curves? [duplicate]

Can anyone please provide an intuitive explanation and proper mathematical reason for non-intersection of SRAC and LRAC at the minimas of SRAC? I am seeing conflicting [1] [2] answers on the site ...
4
votes
2answers
225 views

Is modern monetary theory sustainable?

I am looking around at a lot of the central banks around the world (primarily ECB, Fed, and BOJ) and they all seem to be simply printing their way out of any issues with their economies. As far as I ...
0
votes
1answer
43 views

Calculating elasticity for $y^2e^{x+\frac{1}{y}}=3$

I want to calculate elasticity of y with respect to x for $$y^2e^{x+\frac{1}{y}}=3$$ My attempt: I calculate $y'$ using: $$y'= -\frac{f_1'(x,y)}{f_2'(x,y)} = - \frac{y}{2-y}$$ I calculated this using ...
1
vote
2answers
116 views

Is the money market model based on assumption of no interest rate targeting on the part of the central bank?

This is quote from Gregory Mankiw's macroeconomics text about mechanism of formation of the interest rate in the money market model: How does the interest rate get to this equilibrium of money supply ...
3
votes
1answer
33 views

Data on inflation target on different countries around the world

Does someone know if there's a page, like a "global bank" online page, where one could see the inflation target for different countries? For example, in x country, for x' year, the inflation ...
3
votes
1answer
44 views

What cognitive biases reduce savings?

In Thinking Fast and Slow Kahneman explains that people can sometimes save less because they underestimate the future benefit to themselves because they view present and future self differently. I ...
2
votes
1answer
113 views

Multiple Forgone Job Opportunities and Economic Profit

I'm told that forgone job opportunities are implicit costs, to be included in calculating economic profit, but I can't seem to see how I could list and consider many different forgone opportunities. ...
0
votes
1answer
43 views

What is causing the difference between USA financial indexes and perceived economy?

While the world is facing economic problems since the spread of Covid-19 in Feb 2020, the main indexes in the world (S&P500 and NASDAQ100) reached and exceeded twice their maximum levels. I ...
0
votes
0answers
38 views

Am I getting comparative statistic right?

Hi I was trying to write down my logic in comparative statistic and I was not sure if I am getting it right. Suppose for each county $c$, an agricultural production function takes the form of Cobb-...
3
votes
0answers
26 views

Calibration of labor market frictions parameters

I want to refer to the following paper A Three State Model of Worker Flows. My questions are regarding the calibration of parameters. First, I would appreciate any help when on p. 11 it says that $\...
0
votes
0answers
42 views

Bargaining game of two robbers [closed]

I could not solve the following question. I don't know how to incorporate expectation in expected utility calculations. I would be very happy if you could help me. Consider the following bargaining ...
1
vote
1answer
46 views

How does the US have gross national savings while running a trade deficit?

If a country has a positive savings rate, that means that more money had to come into the country from somewhere outside of the country. However, we run a trade deficit, so we're actually sending more ...
1
vote
1answer
74 views

Quarterly regression, year-fixed effects

I am trying to inspect the heterogeneous effects of a USA-based shock on a panel of countries using quarterly panel data. My variables of interest are the USA-based shock (which has only temporal ...
0
votes
1answer
34 views

Why doesn't national savings, in aggregate, always equal to zero in monetary terms?

Referring to this question and this one Imagine you had a closed economy with two people and they both started off with $100 dollars. How would net savings in aggregate ever not be zero? Anything ...
2
votes
2answers
479 views

Auctions and finding nash equilibrium of a dynamic game

Suppose we have a sequential version of an Auction game: • Player 1 places a bid. • Player 2 observes player 1’s bid, then places a bid. • The player with the highest bid wins the item at auction. • ...
1
vote
1answer
46 views

Relevance of central bank

Why do we need central bank ? surely the government can print currency and regulate banks by conducting audits through finance ministry and so on. Why do we need central bank ?
1
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0answers
16 views

Question on the choice of boundary in the CUSUM test when we make some resampling

Question on the choice of boundary in the CUSUM test when we make some resampling We are considering to make a CUSUM test for some economical time series $𝑋=(𝑥_1,..,x_n)$. Suppose 𝑋 contains many ...
0
votes
1answer
4k views

Quarterly GDP growth terminology: YoY vs QoQ

Quarterly GDP growth can be calculated either in terms of YoY change or — in the case of seasonally adjusted data — in terms of QoQ change. (A third option would be to annualize the QoQ rate.) To ...
1
vote
1answer
18 views

Does savings always equal investment? Are there any cases where savings could be removed from the economic system altogether and break the balance?

Assuming a closed economy, does savings always have to equal investment? If an individual produces a certain amount of a resource and saves it, that becomes part of the savings of the economy. However,...
1
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0answers
64 views

Finding long run total cost function

I am trying to find the long run total cost function, given the firm's production function $y=L^α K^β$ where $α,β>0$ and two inputs $L$ and $K$ where $ L,K∈R_+^2$, with factor prices $w$ and $r$ ...
-1
votes
1answer
22 views

What was the annual real growth rate in the US from 2010 to 2015?

If we look at the US M0 money supply after the global financial crisis (GFC): we see that it doubled from 2010 to 2015. If we look at the Consumer Price Index in the same period: it rose by 8%. So ...
0
votes
1answer
15 views

Would a car that was produced last year but bought this year be accounted for in the GDP? [duplicate]

The equation for the GDP is: $$C+I+G+(X-M)$$ If consumers are buying new cars produced last year...would those still be included in the GDP?
0
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0answers
34 views

How to derive consumer expenditures in EMEA 14.2.5

I am working on a problem 14.2.5 from EMEA by Sydsaeter, Hammond and Strom. Consider the consumer demand problem: $$ \max_{x,y} U(x,y) = \alpha \ln(x-a) + \beta \ln(y-b) \text{ s.t. } px+qy=m \tag{*} ...
2
votes
1answer
80 views

Extending the Muth-Mills Model to Different Income Groups?

I am exploring the generalized treatment of the Muth-Mills monocentric city model covered in Brueckner's article. The model is based on an assumption of homogenous income levels across the city. ...
0
votes
0answers
29 views

looking for detailed case studies on how high inflation was dealt with, with all pertinent objective facts [closed]

i am looking for case studies on how high inflation was dealt with in different countries. if anyone can post whatever detailed and objective fact compilations (facts as i detail further down) Sources ...
5
votes
1answer
70 views

Bayesian Nash Equilibrium in a Duopoly Cournot Competition

I am having a hard time to solve a Bayesian Nash equilibrium game in a duopoly cournot competition setting. So, I have two firms with given production quantities, let's say $q_1$ and $q_2$ (i.e., not ...
3
votes
3answers
181 views

Translog cost function [closed]

Can anyone help to estimate total cost under Translog cost function. I have input output and input cost data. It would be highly appreciated if someone can provide a software demo to estimate the same ...
2
votes
4answers
5k views

What is the purpose of interest?

What is the purpose of interest? Why do most economies permit the charging of interest? Could an economy function without interest at all, or is interest necessary for an economy to function?
1
vote
1answer
53 views

Classical Theory of Inflation - Money Supply, Money Demand and Prices

In every textbook, website I read when talking about the classical theory of inflation, I see the diagram below which depicts the value of money, prices etc. This one below is from Spark notes (https:...
3
votes
2answers
155 views

Difference between the International Dollar and PPP

This may be a very rudimentary question but I am trying to discern the difference between purchasing power parity and the international dollar. I am starting to work on a project where we are trying ...
3
votes
0answers
38 views

Theoretical models of copyright infringement and efficiency implications

I wanted to know if there are theoretical models of copyright infringement and what are their implications for efficiency in the market and also, if possible, any empirical support they have. When I ...
1
vote
1answer
29 views

Proximity-concentration hypothesis: homogeneous firms and symmetric countries

Hi everyone I am running into a stone wall and don't seem to be able to solve this, can someone show me the steps how I can insert 1 into 2 and get 3. $B=\frac{f_E+f_D}{φ^{(σ−1)}*(1+τ^{(1-σ)})}$ $π =...
1
vote
0answers
42 views

Revelation principle when the type space is infinite [closed]

Consider a mechanism design problem in which the agents have type spaces that are uncountably infinite. I have a couple of questions which are numbered throughout this post. The revelation principle ...
3
votes
1answer
84 views

Can inflation show up in assets without necessarily being reflected in classic inflation indexes?

I have been having an argument with a friend of mine who obtained an economics degree in college. I have been arguing that increased money supply from the fed has led to inflation in asset prices, ...
4
votes
1answer
45 views

What was the US monetary policy like in the 70s?

Today the US inflation target is roughly 2%. However in 1974 the inflation rate was 11% and in 1980 it was 13.5%. What monetary policy did they follow at that time that allowed the inflation to rise ...
3
votes
4answers
92 views

What happens when government bonds purchased as part of central bank quantitative easing (QE) reach maturity?

Does the central bank ask the government to pay or are they rolled over?
3
votes
1answer
135 views

Consumption smoothing in RBC Model

I have the following inter temporal utility function: $U(t)=(\frac{s(t)}{1-\sigma})(c_t/c_{t-1}^\gamma)^{(1-\sigma)} - \chi*h(t)$ where $h(t)$ is the hours worked. I know that gamma is responsible ...
1
vote
0answers
32 views

Why the ageing population creates problems for a country to fund old-age social protection program and what solution do we have?

Senior citizens are considered as one of the vulnerable groups and therefore, they need some social protection during their old age. However, we also face the worldwide trend of an ageing population. ...
0
votes
0answers
13 views

Pricing optimisation when elasticities are positives? [duplicate]

I’m performing some exercises in order to get the optimal price of some product such a potato chips, biscuits, drinks, etc. (I’m taking price per unit and sales in units) But I’ve found that some of ...
2
votes
1answer
50 views

Separation rate

I want to refer to the paper Aggregate implications of indivisible labor, incomplete markets, and labor market frictions. In Footnote 9, there is a brief explanation of how the separation rate is ...
0
votes
1answer
31 views

How to handle the missing values' issue of newly listed stocks?

I am trying to test some asset pricing models on 10 portfolios for the period of 2010-2020. The problem is that three of these portfolios included stocks that are newly listed in 2017 and 2018, so I ...
1
vote
0answers
26 views

Optimal price when elasticity of demand is positive? [closed]

I’m performing some exercises in order to get the optimal price of some product such a potato chips, biscuits, drinks, etc. But I’ve found that some of them have positive elasticities. This can makes ...
1
vote
1answer
69 views

Trouble at differentiating a consumption function

everyone. This is kind of a basic question, but I have a weak background on calculus and I already tried to figure this out by myself for a few hours without success. So, I am finally appealing on you ...
1
vote
0answers
15 views

How to find equilibrium price with inverse demand? [closed]

So I know how to do it when it is a function of Q but as a function of P I'm confused about what steps I have to take demand: p = 1000-0.025q supply: p=150+0.033q
1
vote
0answers
16 views

Refunded Emission Payments - how does it work?

I know that there are different types of Refunded emission payments e.g., : expenditure based output based However, I think it is difficult to understand how Refunded emission payments works? I ...

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