All Questions
15,514
questions
1
vote
0
answers
33
views
Why would bank runs lead to a decrease of the total quantity of money supply M1?
It‘s specifically about the German banking crisis of 1931. I get how the banks increasing their reserves and cutting their loans (starting 1930) would cause money contraction (at least of M1). Doesn‘t ...
- 11
0
votes
0
answers
19
views
Why cant other country Imitate China give people work in place of relief subsidies? especially country with low-employment rate?
From my shallow perspective as a Chinese, whenever there is a low economic growth rate, there is a massive infrastructure building plan as to give people work in place of relief subsidies to stimulate ...
- 1
0
votes
1
answer
22
views
What is the difference between "The effects of Monetary Policy" and "The effects of Monetary Policy Shock"?
I know this may be a silly question. I always thought these were different but some people in the literature use them interchangeably and I was wondering are they different? If so, how are they ...
- 157
0
votes
1
answer
21
views
Is my understanding of Arrow's dictatorship correct? The dictator is free to update her preference and the social choice will always follow her taste
Suppose $R$ is a social ordering, $f$ is the social choice function, and $R_i$ is an individual preference. A profile of individual preference is $<R_i>$.
$f(<R_i>)=R$
Suppose $i=1$ is ...
- 259
0
votes
1
answer
23
views
Which Spanish scholastic economist said that economies could not be controlled even if one could track every transaction?
Which Spanish scholastic economist said that economies could not be controlled even if one could track every transaction?
I think the context was an argument against Keynesian economics, Cartesian ...
- 473
1
vote
0
answers
37
views
How to add a linear contraint between state variables to a current time Hamiltonian?
Let's say I have an objective function $F$ with state variables $A,B,C$ and relative equations of motion, I can create the current time Hamiltonian with $H_C = F\{A,B,C\}+\alpha * \dot A+\beta * \dot ...
- 307
-1
votes
0
answers
27
views
Equilibrium asset prices of a risk-free bond and a stock
Setup:
Two-period economy with two equally likely states of the world in the second period.
Two consumers with Bernoulli utility and same discount factor
- 13
0
votes
1
answer
22
views
FOCs for profit maximization using a transformation function
I'm (still) reading the microeconomics textbook of Mas-Colell et al. On p. 135, the profit maximization problem (PMP) for producers is introduced; characterizing the technology as $Y = \{ y \in \...
- 283
0
votes
0
answers
41
views
Forecasting and Structural Breaks
Let's say I am using walkforward evaluation for forecasting a certain time series with ARIMA and I want to test for structural breaks. And then I detect structural breaks. How can I use this ...
- 101
0
votes
0
answers
31
views
Differentiation of a composite utility function
Taking the utility function $U: ln(c_1)+\beta ln(c_2)$ with $c_t=\sqrt{c_{Nt}c_{Tt}}$, t indicating a time period 1,2. Ignoring any b.c.'s.
I am having issues interpreting the marginal utility wrt $c_{...
0
votes
1
answer
66
views
Auction with independent private values - An example from Game Theory: Analysis of Conflict by Roger Myerson
I have difficulties understanding the equilibrium analysis of the following auction game:
Suppose that there are $n$ bidders in an auction for a single indivisible object. Each player knows privately ...
- 251
0
votes
1
answer
42
views
General mechanism of bond price and real interest rate movements
Jeremy Siegel writes in "Stocks for the long run" that when better than expected economic data is released bond prices fall and real interest rates go up.
Why do bond prices fall with ...
- 1
0
votes
0
answers
23
views
What does it mean for a country to use another country's currency?
Argentina's new President-elect is proposing replacing the peso with the US dollar as the country's currency.
What exactly does it mean for country A to adopt country B's currency? And how does it ...
- 131
0
votes
0
answers
16
views
Why do firms produce less than what is socially optimal in an imperfect competition?
I just read an introduction to imperfect competition in my AP microeconomics textbook and one of the practice questions asked about production in imperfect competition. The answer choices were ...
- 1
0
votes
0
answers
21
views
"If the aggregate supply is linear, demand shocks cannot affect average unemployment", what does it mean?
Aggregate Supply: $\pi_t =\pi_{t-1} -\alpha(u_t -\bar{u})+e_t^S$
Welfare: $W_t =-cu_t -f(\pi_t ), c>0, f''(\cdot)>0$
$\bar{u}$: natural unemployment rate
$e_t^S$: supply shock
In Romer's ...
- 1
0
votes
1
answer
29
views
Define "Equilibrium" in Market Design task
in a current market design problem set I am very confused by the given questions.
We are often asked to find "an equilibirum of the [auction type, e.g. second-price auction]".
The amount of ...
- 3
0
votes
1
answer
67
views
Does anybody know why the Fed Funds Effective Rate has 3 evenly spaced dips in between every FOMC meeting, that suddenly stop on March 21st 2018?
In general the effective rate was much more volatile the further back you go, but now it is perfectly straight, what has changed? The fact that it is exactly three evenly spaced dips of 8-10 basis ...
0
votes
0
answers
11
views
Taylor Rule Model Specification: Serial Correlation and Interest Rate Smoothing
I'm reading this paper by Abrams and Iossifov. The paper investigates electoral cycles influence on monetary policy by estimating a Taylor Rule reaction function using OLS. The authors describe the ...
0
votes
0
answers
14
views
Can anyone pls do the derivation of the cournot aggregation condition and make it explanatory
I'd like to know how the aggregation condition was derived.
- 1
0
votes
1
answer
40
views
Understanding consumption units normalisation by $u^\prime (c) $
It is frequently noted that if utility is given by $u(c)$, then the object
$$ \frac{u(c)}{u^\prime (c)} $$
puts the utility in consumption units via the normalisation by $u^\prime(c)$. What is the ...
- 140
0
votes
0
answers
14
views
How could a market be designed to prevent hoarding?
Imagine that someone has been put in charge of creating a new market for some kind of commodity. They have ultimate regulatory power. What kind of market mechanisms could they put in place to ...
- 101
0
votes
1
answer
46
views
How to compare Preferences in Utility Functions?
When looking at utility functions, how do you compare preferences? I understand the economic concepts, but the math part is holding me down from understanding a lot in the textbook. (I am not typing ...
0
votes
0
answers
12
views
Calculating Effective Maturity with Negative Cash Flows
The formula for effective maturity.
Suppose that an installment plan also shows additional borrowings of a debtor. That is, at some point in time (other than the inception date) the borrower is given ...
- 1
-1
votes
0
answers
19
views
Derive differen function of production
Find the optimal cost function, profit function, and input functions of the following supply functions: a. 𝑓(𝑙, 𝑘) = 4𝑙½k½ b. 𝑓(a,b)= (a^½+3b½)^2
1
vote
1
answer
26
views
The consideration of export in calculating national income
Is export/imports a part of factor income i.e returns from the act of production? If not, then here is my counter argument.
Export is the equivalent value which is added to the goods when it is ...
1
vote
1
answer
61
views
Why Is Having a Strong Manufacturing Base Important to a Country's Economy?
I was living in Pittsburgh in my teens and twenties during the collapse of the steel industry and remember how profoundly it impacted Pittsburgh. Some say that due to the large percentage of the ...
- 113
1
vote
1
answer
64
views
MR Diagrams touching y axis
The following is from an exam question:
To my mind this is plain nonsense. If Q is zero, AR and MR are zero, not some point above P1.
My question: is there any significance in drawing this diagram ...
- 143
0
votes
1
answer
47
views
Using Variance for Nash Equilibrium
For the mixed strategies, the expected utility (or payoff) is used to find the mixed strategy Nash Equilibrium. The main assumption is players try to maximize their expected payoffs. However, I think ...
0
votes
0
answers
19
views
What are the ways to take account of inflation?
If one wants to analyze the influence of inflation on other macro economic indicators, what are the best/standard way of how to use it?
I've found 3 variants:
As is (yearly values).
To take ...
- 133
0
votes
0
answers
23
views
Deflated Consumption Data
I have been researching the literature of consumption inequality for my project. Most of the articles have deflated the consumption datasets, before measuring the inequalities with different indices. ...
0
votes
0
answers
56
views
Mixed Strategy Nash Equilibrium
Consider the game of Battle of Sexes, where
$$\begin{matrix}
&&Women\\
&& Football & Resaurant\\
Men&Football&2,1 & 0,0 \\
&Restaurant&0,0 & 1,2
\end{...
1
vote
1
answer
48
views
Complex Analysis VS Differential Geometry as signals/preparation for grad school?
I am an undergrad (in math and econ) interested in pursuing a PhD in the latter. I can afford a pure math elective this semester and I am torn between diff geom and complex analysis. Which one is more ...
0
votes
2
answers
82
views
t-test result inconsistent with regression
I have two batches of data and I want to check whether the response variable is different across the two batches. I first did a t-test and found that the means of the response variables in the two ...
- 149
1
vote
0
answers
26
views
Ultimatum game where fair offers are automatically accepted
Has there been any experiments with a variant of the Ultimatum Game where a fair offer is automatically accepted?
For example, the game below, where rule 2 has been added to the classic ultimatum game:...
- 111
0
votes
0
answers
10
views
Regression and RDD give results in opposite directions but both statistically significant
I am conducting an RDD on an attitude and how it shifts over time due to a shock (sharp RD measured in days), I am using RDROBUST in STATA. I do not think I have coding errors but I need help ...
- 1
2
votes
1
answer
69
views
Does this contraction mapping map strictly concave functions into strictly concave functions?
Consider the following functional equation:
$$TV(k)=\max[W(k),\beta V(f(k))]$$
where $\beta\in (0,1)$, $W(k)$ is continuous, increasing, bounded, and strictly concave function defined on $[0,\bar{k}]$,...
- 103
1
vote
2
answers
133
views
How can I show that the policy function is non-decreasing?
Consider the following functional equation:
$$V(x)=\max_{y\in [0,f(x)]}[u(f(x)-y)+\beta V(y)]$$
where $u$ is continuous, strictly increasing, and strictly concave; the function $f$ is continuous and ...
- 375
0
votes
2
answers
126
views
Marshallian demand for x^2+y^2
My question is regarding a simple marshallian demand calculation. Given a utility function $u(x,y)=x^2+y^2$ and a budget constraint $p_1x+p_2y=m$. What are the Marshallian demand functions for each x ...
- 3
0
votes
1
answer
44
views
Advanced Macroeconomics David Romer Chapter 10
I am currently reading David Romer's Advanced Macroeconomics for self study. Could someone please kindly explain to me how to derive (10.21) from chapter 10 in more detail than the textbook?
- 1
0
votes
0
answers
4
views
Certificates of origin for electricity that was subsidised by Germany's EEG (Renewable Energy Law)
In Germany there is the EEG (Erneuerbare Energien Gesetz - Renewable Energy Law).
The rough outline of the law is as follows: If I run a solar installation and feed electricity into the grid, I get a ...
- 101
0
votes
0
answers
24
views
Finding strategies and subgame perfect equilibria
In my game theory class we recently learned about dynamic games and I wanted to know whether I solved my homework problem correctly (and how to attempt the second part).
a) Determine all strategies ...
- 101
0
votes
0
answers
20
views
Is the S-curve applicable to the development of the electronics industry?
There are a lot of biological, social, economic and technological phenomena described by the S-curve.
For example a dam building. There is an obvious limitation in the number of convenient places to ...
- 153
0
votes
0
answers
36
views
Help Understanding AP Micro MCQ re: Monopolistically Competitive Firm's Demand Elasticity
Here is the question:
A monopolistically competitive firm’s demand curve will be least elastic if
A - the number of rival firms producing very similar products increases
B - the number of rival firms ...
- 46
0
votes
1
answer
56
views
Calculation of simple elasticity problem
I'm reading Advanced Macroeconomics by Romer and having trouble to understand very simple calculation provided in just one sentence.
Define real money market equilibrium condition as $(\frac{M}{P})^s=...
1
vote
1
answer
70
views
How do I find the Walrasian equilibrium price?
Consider a production economy with 1 consumer and 2 firms. The consumer's utility is $u(x,y)=xy$. The first firm makes $x$ using capital and labor according to the production function $x=k^\alpha l^{1-...
- 375
0
votes
0
answers
21
views
Panel Data Econometrics
I have some medical information of individuals spanning ten years which includes first name, last name, dob, and other variables (two/three that could help match observations i.e. state living, ...
- 31
0
votes
0
answers
30
views
Source of Fed Speeches Portal
Does anyone know of a website that contains all the text speeches of all the FOMC members and regional Federal Reserve Bank Presidents going back to a few decades, for example the 1970s.
- 1
1
vote
1
answer
127
views
Why is the budget correspondence lower hemicontinuous?
Given income $y$ and a vector of commodity prices $p\in R_+^L$, the set of feasible consumption bundles is described by the budget correspondence, $B(p,y)=\{x\in R_+^L:px\leq y\}$. $B(p,y)$ is both ...
- 375
0
votes
0
answers
12
views
Dynamic price competition with capacity constraints
I have a dynamic price (Bertrand) competition with 2 players with the same capacity constraints. Grim trigger strategy is to set monopoly price at t=0 or if the monopoly price was set by both players ...
- 21
0
votes
1
answer
27
views
For my bachelors, would it make sense to use C+G (as Consumption + Government Expenditure) as an indicator for the prosperity of the economy?
Because G is also really just consumed by the people, wouldn´t it make sense to measure all the things that people consume to measure the prosperity of an economy?
At the end of the day, people in an ...
