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1answer
17 views

Does Direct Benefit Transfers make an economy poorer?

Printing money and giving to the poor causes inflation. Increases demand and hikes prices. This is basically certain. But on the contrary, a paper titled Debunking the Stereotype of the Lazy Welfare ...
0
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0answers
8 views

Is an input-output model an equilibrium model?

I know the difference between CGE and input-output models. But can an input-output model be called a equilibrium model?
1
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0answers
11 views

Existence of Symmetric Pure Strategy Equilibrium

I have 2 symmetric players $A$ and $B$. Each of them has 2 decision variables $x_i\in[0, \beta]$ and $y_i\in[0,1]$, where $i\in\{A,B\}$. Their payoff functions are symmetric, i.e., if you swap the ...
0
votes
0answers
15 views

Using ML to estimate demand function

Say, I am looking to estimate the demand curve for rental of a real estate property. The demand varies depending on time of the year, location, economic and demographic variables. I'd like to ...
0
votes
1answer
25 views

What's the role of money multiplier in the banking system?

On the internet , there are lots of people claming that the banking system has an immense power because it can multiply money obtained by deposits ( 'make money out of thin air' ) and then lend this ...
5
votes
4answers
243 views

Why do we need to “get the economy moving again”?

Sorry I have no background in economics but as a computer programmer, I specialise in building models out of simple math and logic, so I hope we can speak the same language without having to get into ...
-2
votes
1answer
29 views

How much moral hazard from Federal Reserve's purchase of junk bonds?

Why doesn't the Federal Reserve appear to worry Moral Hazard? How bad's the Moral Hazard? The Fed is creating money to transfer to the balance sheets of corporations that invest in securities like ...
0
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0answers
19 views

Are there benefits from the financial economy diverging from the real economy?

There are some adverse effects of the financial economy decoupling from the real economy. Here are just a few debatable, but nonetheless thought-provoking points: High asset prices often create ...
0
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0answers
6 views

Helicopter Money in the time of Covid-19

In this voxEU article by Jordi Galí, he says the following: In the current context, the central bank could credit the government's account (or governments, in the case of the ECB) for the amount of ...
-3
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0answers
10 views

Can someone help me solve this cost table

Can someone help me with solving this?
1
vote
1answer
28 views

How do the factors of production map to the GDP identity?

How do the 4 factors of production (nature / capital / labour/ entrepr.) map to the GDP components in: $$Y=C+I+G+(X-M)$$ To me it seems that all factors map to all GDP components, simply because it's ...
-1
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0answers
24 views

Meaning of revenue deficit

On the internet, I find that there are two different meanings given to the phrase' revenue deficit'. One says that it is the excess of revenue expenditure over revenue receipts of ,let us say, a ...
0
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0answers
41 views

Farmer and owner Bayesian game

A farmer has talent $\theta$ uniformly distributed on $[0,1]$. His payoff from farming his land is $\theta.$ Before setting up his farm, he chooses some $w\geq0$, which a plant owner can either accept ...
3
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0answers
23 views

Does a monopolistically competitive market outcome involves assuming rational expectations?

E.g. When Grazzini et al. (2014) discuss a "monopolistically competitive outcome" (MC) in their paper ($2.1), which is based on Dixit-Stiglitz's model, 1977, does this outcome involve assuming ...
1
vote
1answer
20 views

What does the Fed mean by “smoothening money market functioning”?

In many recent interviews, Fed Chairman Jerome Powell has repeatedly mentioned that ensuring the smooth functioning of money markets is a key goal of the Fed's recent monetary policy actions. I want ...
3
votes
1answer
92 views

Fiscal policy in the Dornbusch model

I'm studying the Dornbusch overshooting model of the exchange rate. Specifically, I'm studying the model presented in a textbook by Copeland (2014). The economy is represented by the following ...
-1
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0answers
23 views

How to express the equation with respect to time

This is Cobb-Douglas function for aggregate economy. where Y is aggregate output, A1 is the level of technology, K is capital stock, and L is total labor hours. I need to express the equation with ...
1
vote
1answer
33 views

Deadweight Loss Due to Taxes Represented on a Graph of the Market?

Let's say a market is operating at equilibrium, with MSB=MSC, and a tax is imposed on the market. This would shift the supply curve to the left and cause a deadweight loss represented by the triangle ...
-1
votes
0answers
21 views

Stackelberg Oligoploy Model [closed]

Question is: "Does first mover advantage depend on the assumption of complete information?" Really need some help please, thanks
1
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0answers
16 views

Overlapping generations model with altriusm basic FOC

I'm working in the OGM with altruism as proposed in Salai's and Barro's book, specifically the problem is: Max $U_t=\sum_{i=0}^{\infty}\large(\frac{1+n}{(1+\rho)(1+\phi)}\large)\large[u(c_{1t+i})+\...
0
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0answers
8 views

Depreciation of currency shall incentivise or disincentivise the foreign portfolio investors?

I am confused - if suppose currency depreciates then assets will become cheaper and foreign investors will find it enticing to buy these assets so in that case, foreign inflows shall increase In ...
0
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0answers
11 views

How can I tell who are major investors in an asset management group and their associated funds?

I am trying to determine which individuals/organizations are the largest investors in Netflix, but when I look at the list of top shareholders, they are all investment management groups. Investment ...
1
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0answers
19 views

What is data trapezoid form?

For one of our class project we are required to do the following: Download U.S. real GDP in data trapezoid form (vintages) I tried to search online for what does the data in trapezoid form means ...
0
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2answers
37 views

How to prove that a function is a positive montone transformation

Consider the utility function $$ U(x_1,x_2) = x_1^\alpha x_2^\beta $$ for $0 < \alpha, \beta < 1$. How do I then show that $$ V(x_1,x_2) = F(U(x_1,x_2)) = \frac{\alpha}{\beta} \ln(x_1) + \ln(...
-2
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0answers
19 views

Is this naive population projection method correct?

For reasons that would be too long to explain here, I need to come up with a world population projection under the assumption that age-related deaths are either entirely eliminated or anyway ...
-1
votes
0answers
23 views

Purchasing a $350,000 house [closed]

Assume you are interested in purchasing a $350,000 house with the following characteristics: 80% Loan to Value Loan @ 4% interest (30yr, fully amortized) Property taxes = 1.2% of purchase price per ...
-1
votes
0answers
9 views

A loan with the following terms is being made [closed]

1) A loan with the following terms is being made: • Fixed rate, constant monthly payment. Closing date February 9th. • 9% interest rate • $70,000 mortgage loan amount. • $1,500 loan discount points ...
0
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0answers
36 views

Can one use the standard deviation of a variable as a regressor?

I am wondering if you could use the standard deviation of a variable as a regressor in an econometrics model? Consider the following hypothetical model: $$y_{it} = \alpha_0 + \alpha_{1}T_{it} + \...
-1
votes
1answer
30 views

Cause of the Bubble Phase - Spend More Than You Earn [closed]

I am a big admirer of Ray Dalio. In his book: Big Debt Crises, one chapter explains The Bubble Phase., and how it happens. Below is the quote of an scaneario in the micro level: Suppose you earn \$...
2
votes
2answers
107 views

How does 'building land' fit into economic modeling?

According to the ONS National Accounts 2018 & RICS land valuations and ... Land that is built on has a value that makes it half of the UK's wealth. The rest of the land has a value less than 3% ...
0
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0answers
19 views

nominal exchange rate

During 2011 the inflation rate in Brazil was about 6.6% while in the U.S. it was about 3.3%. At the start of 2011 the nominal exchange rate was about 1.7 Brazilian real per U.S. dollar. If purchasing-...
1
vote
1answer
30 views

GDP Discrepancies

I'm trying to practice reading economic data from FRED and BEA websites, but they seem to be providing conflicting data that I cannot understand at all. For example, looking at Real GDP percentage ...
1
vote
1answer
21 views

Understanding GDP Chart

When I Google "GDP of 1950", I get ~$300 Billion. Looking at the graph @ https://fred.stlouisfed.org/series/GDP . I see Q1 280 billion Q2 290 billion Q3 308 billion Q4 319 billion My questions: ...
1
vote
1answer
39 views

What is the result of the Bellman Equation

I'm just starting with dynamic optimization and although I understant the proof's of the theorem I'm not able to fully understand whether the bellman equation is a function , a function valuated at ...
1
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0answers
13 views

Stabilizing Property of a Taylor Rule

Considering the New Keynesian Model we have the Phillips curve and dynamic IS curve in log-linearized form with price shock $u^{\pi}$ and demand shock $u^{IS}$ :$$\pi_t=\beta E_t\pi_{t+1}+\kappa(y_t-...
0
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0answers
18 views

Example on profit function that contains the maximum of a decision and a random variable

I am looking for an example of a profit function that contains the maximum of a decision and a random variable in this form: $\max(d,X)$, where $d$ is a decision variable and $X$ is a random variable. ...
0
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0answers
12 views

What does it mean that Ontario is considering a regional approach to reopening? [closed]

I read the article Ontario now considering regional approach to reopening the province but failed to understand what it means by "the province is now considering a regional approach to reopening." I ...
0
votes
0answers
15 views

Bank lending rate & ROE

When a bank lends money to a company, does the bank (typically) demand an interest rate higher or lower than the ROE (Return on Equity)? I have always thought they demand a higher interest rate but I ...
2
votes
4answers
215 views

How can people save in a equilibrium economy?

Two people on a desert island: John produces 100kg potatoes and sells them to Paul for \$100. Paul catches 100kg fish and sells it to John for \$100. GDP is \$200\$, right? Next year, they improve ...
0
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0answers
5 views

Relationship of Customer discrimination and discrimination by a firm

The following question relates to Becker's Theory of Discrimination. In the context of the question of whether a firm taste-discriminates against a minority group, I was of the opinion that the firm ...
0
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0answers
34 views

How do I understand the fed

I apologize if this question seems incoherent as I'm struggling to get my thoughts together. I would like to understand the Fed and their mechanisms better, and their far-reaching implications of ...
0
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0answers
44 views

What are the calculations that policy makers do when deciding to ease a lockdown?

I have heard this question framed as making the decision between lives and the economy. But on the other hand, I also read a StackExchange discussion(I am not sure of the link), where it was shown ...
9
votes
4answers
1k views

Mortgage loans from foreign banks at lower interest rates

I had a thought - what if I live in a relatively poor country like let's say Russia and I would like to buy a house. In order to do that, I need to take a mortgage loan. In Russia however, interest ...
0
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0answers
30 views

Does the negative economic shock caused by the covid pandemic can increase mean productivity?

Countries in the middle income trap often have trouble with capital and technological accumulation, informal labor market, institutional deficiencies, low productivity, etc. If firms in those ...
1
vote
0answers
20 views

Keynesian cross. Can there be a situation when the point of equilibirum “runs away”, shifts in response to attempts to reach it?

In Keynesian cross model, as far as I understand, income-expenditure equilibirum is reached this way: when unplanned inventory investment>0, then firms produce less, when unplanned inventory ...
0
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0answers
25 views

What would be the mean of a finite aggregation of AR(1) processes?

What would be the (expected) mean at each period t of a (in)finite aggregation of AR(1) processes generated by the same data generating process? How would the resulting plot look? For iid data ...
0
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0answers
19 views

Does combination of the paradox of thrift and the acceleration principle reduce economy to c=a level of consumption during recession?

By "c=a level" I mean situation when all consumption by households equals to autonomous spending, more or less. I assume no counter-cyclical policies(including automatic stabilizers). I also assume ...
3
votes
1answer
43 views

What is the definition of: 'commodity space'?

I have seen the concept of commodity space being used multiple times in economics, in particular within microeconomics, but I could not find a general definition of it. Based on the examples that I ...
-1
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0answers
25 views

Are charter cities already existent? [closed]

Is the concept of charter cities already in practice provided we answer to politicians and politicians answer to billionaires and corporate executives?
1
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0answers
24 views

In credit easing, how do central banks avoid allegations of unequal treatment?

In credit easing, central banks purchase private assets such as corporate bonds. How do central banks choose which corporate bonds to buy? If the central bank buys bonds of one company but not those ...

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