# All Questions

10,817 questions
Filter by
Sorted by
Tagged with
273 views

I am a fledgling computer science researcher working in intersection of economics and computation. Please excuse me if this question seems out of place to the administrator. I am currently studying ...
448 views

### Is elasticity of substitution between goods empirically constant?

In New Keynesian models, we use a lot of CES assumption, usually Dixit-Stiglitz, to develop an economic model. Is CES, constant elasticity of substitution between goods, empirically (approximately) ...
282 views

### What are the economic impacts of different professions?

Every dollar a research worker earns makes the economy \$5 better off and every dollar a finance worker makes costs the economy \$0.60 So Reddit Economics yesterday posited and later retracted the ...
487 views

### Real option effect of uncertainty - irreversiblity vs fixed cost

There is a growing literature (e.g. Bloom, 2009) studying negative macroeconomic impacts of heightened uncertainty. One channel through which uncertainty can discourage economic activity, and ...
387 views

### Neo Keynesian Modelling and the Lucas Critique

Some people from the more extreme microfoundations/internal consistency camp keep bashing the Neo Keynesian model for the Calvo pricing being not micro founded and hence the whole model not being ...
778 views

### How do I compute the relative risk aversion of Epstein-Zin preferences?

$$\newcommand{\E}{\mathbb{E}}$$ Preface This question is related to this one about the elasticity of intertemporal substitution and this one about the definition of absolute risk aversion. (It's ...
4k views

### Why is economic growth measured exponentially rather than linearly?

If economic growth is indeed highly desirable (see this question), why must this growth be exponential? With finite resources, exponential growth might hit limits rapidly (or be impossible?). Why not ...
13k views

I am trying to understand Lagrangian multipliers and using an example problem I found online. Problem Set Up: Consider a consumer with utility function $u(x,y) = x^{\alpha} y^{1-\alpha}$, where $\... 7answers 2k views ### Macroeconomics Textbook on New-Keynesian models I'm looking for textbooks that explain the New-Keynesian models, without taking shortcuts on the mathematics, that would go in depth on the derivations of the formulas. I appreciate rigour, and ... 3answers 2k views ### How is it possible that all currency exchange rates are fixed w.r.t. to each other? I wondered if it would be beneficial to exchange a currency through one or more "in-between" currencies. For example: instead of trading Russian Ruble (RUB) to Euro's (EUR), one would trade from RUB ... 3answers 855 views ### Game theory for showing interest and availability when dating The more cynical (or perhaps realistic) of us would argue that there's a fair amount of game theory going on in the dating game. For example a classic ploy is 'Don't ring for three days, because you ... 5answers 855 views ### What is the evidence that econometrics has empirical value? Economies are extremely complex systems with many variables, not to mention the fact that they emerge from the interactions of complex beings. I agree that economies have certain underlying principles,... 2answers 171 views ### Schumpeterian Business Cycles The basic idea of Schumpeterian Business Cycles is that new technologies require creative destruction but will yield positive growth. These two opposing forces have impacts onto the real economy at ... 3answers 3k views ### Can the stock market show indefinite exponential growth? In a comments on a question on money.SE, the following dialog took place: Eventually there will not be enough matter to represent all the money, so we know for certain that the answer is "No" for a ... 6answers 5k views ### Which are the different Schools of Economic Thought? It would be great to have a brief but comprehensive list of current (e.g. Austrian) and defunct (e.g Mercantilism) schools of thought in Economics. I think an ideal answer would include: the defining ... 3answers 3k views ### Why do low-budget films charge the same amount at the box office as super-high budget films? In most occurrences, lower production costs translate into lower sales costs. Obviously there are other factors that influence price, including perceived value (affected by advertising), monopolies, ... 3answers 788 views ### In the US, do high wages in regions like New York and California offset the high cost of living? It's well understood that the cost of living in New York City vastly exceeds the cost of living in, say, rural Louisiana. It is also well understood that wages in New York City vastly exceed those in ... 2answers 9k views ### What is a substitute/complement in terms of mixed partial derivatives? I am trying to understand how substitutability relates to mixed partial derivatives. I thought the change in marginal utility with respect to a change in the amount of$xwould correspond to \frac{\... 3answers 2k views ### Money in the animal kingdom Animals living in packs must have ways to decide how to distribute their goods among the pack members. Just like prices can appear in an exchange economy, prices could appear in pack economy. Though ... 5answers 1k views ### What are the arguments against the rational expectations hypothesis? I believe the rational expectations hypothesis says that agents in a model bear expectations that are the same as mathematical expectations. Under what circumstances does this hypothesis become ... 3answers 492 views ### Economics Online Seminars As education moves to the internet, so are research seminars. Some of these seminars are regular and others appear to be temporary due to the covid-19 and the lockdown. Here are some examples from ... 3answers 696 views ### Impact of auction systems that allow 'sniping' I'm a bit perplexed that eBay has auctions that have a fixed time ending, and so winners are often determined by who can 'snipe' the auction, by putting in the winning bid at the last possible ... 2answers 226 views ### Optimality of Zero Capital Taxation The Chamley-Judd result of zero optimal capital taxation says that 0 capital taxation are required in order to maximize welfare at the steady state. The result is 30 years old. Still assuming that ... 2answers 784 views ### OLS bias in demand estimation: the bias always underestimate the demand's elasticity? Some papers argue that OLS can produce less bias than IV estimation depending on the quality of your instruments. Suppose we consider a demand estimation equation. Suppose the demand elasticity is ... 3answers 530 views ### Nobel prize for empirical work Did any recipients of the economics Nobel prize receive their prize for work that was primarily or substantially empirical (rather than theoretical) in nature? 2answers 3k views ### Intuition behind risk premium In Lecture 20 of MIT's Microeconomics course, a situation is proposed where a 50/50 bet will either result in losing \100 or gaining \125 with a starting wealth of \100. It is stated that a person ... 3answers 60k views ### 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 ... 1answer 1k views ### Wouldn't abolition of cash give rise to a substitute currency? Some countries (e.g. Sweden and Denmark) plan to abolish physical cash in the future and restrict the use of cash to electronical deposits. One of the reasons for this is to prevent hoarding / boost ... 3answers 2k views ### Is it possible to have a modern economy without a central bank? Many mainstream economists say that such thing is impossible. Is there some specific reason why the financial system needs a central bank? In this video http://m.youtube.com/watch?v=BcuAOdXD0Go, ... 3answers 929 views ### What is the calculable effect of counterfeiting on an economy? I'm curious whether one can numerically calculate the effect that counterfeiting has on an economy. As I understand it, counterfeiting essentially amounts to theft of the wealth of everybody holding ... 2answers 927 views ### Simulating Real Business Cycle Basically I need to replicate Hartley's 'A User's Guide to Solving Real Business Cycle Models' (http://www.econ.ucdavis.edu/faculty/kdsalyer/LECTURES/Ecn235a/Linearization/ugfinal.pdf). Specifically, ... 1answer 571 views ### Is it possible to derive indifference curves given marshallian demand function? In a two good world, will a marshallian demand function the likes of D(p,m) where p is the price of one good and m the income yield a utility function or ... 2answers 6k views ### What is the purpose of measuring GNP? I know that the GDP (the value of all final goods and services produced within a country during a given period of time) is useful for determining the productivity of a nation, the size of the nation's ... 3answers 1k views ### Was the Concorde project an example of the sunk-cost fallacy? The sunk-cost fallacy has also been dubbed the Concorde Fallacy. Examples of the Concorde Fallacy in the academic literature and beyond I believe Dawkins and Carlisle (1976) were the first to use ... 1answer 479 views ### Why hasn't Quantitative Easing surged inflation, or caused hyperinflation? Quantitative Easing (QE) is the buying of bonds and other financial assets by the Central Bank with high-powered money, or money created by the CB for this purpose. Isn't this ad-hoc creation of ... 3answers 2k views ### Why is the derivative used to represent marginal cost instead of the difference? Marginal cost is defined as "the change in the total cost that arises when the quantity produced is incremented by one unit." And given a total cost function C(q) that's differentiable, the marginal ... 2answers 704 views ### Can the Machina Paradox be solved by expanding the choice set? In another question, the Machina paradox is mentioned as a possible counterexample to the expected utility model: Adding to the list of paradoxes, consider Machina's paradox. It is described in Mas-... 2answers 669 views ### Regression over the whole population What's the meaning of the standard error of a coefficient in a regression when the whole population is included? I've been so puzzled by this question. Because it seems to me, standard errors make no ... 2answers 12k views ### CES: Production function: Elasticity of substitution \sigma = 1/(1 + \rho) I have to prove that \sigma = 1/(1 + \rho) for the CES production function: \begin{align} q = (l^\rho + k^\rho)^\frac{1}{\rho} \end{align} I found out that I need to solve the following equation: \... 1answer 251 views ### Are there papers in evolutionary game theory that are influential in economics? The concept of evolutionary game theory has been around for about forty years. The mathematical details are worked out quite well. Yet this discipline is usually a side note in game theory classes and ... 2answers 5k views ### Difference-in-differences in 2SLS regression Usually when we do a difference-in-differences estimation, we do it in a OLS reduced form as follows: Y_{it}=\alpha After_t+\gamma Treatment_i+\delta After*Treatment_{i,t}+X_{it}\beta+\epsilon_{i,... 1answer 281 views ### Price dispersion in online retail There are a number of online booksellers that are popular in India right now. The prices they charge for the same book often differ by as much as 10% (See this price comparison site to check http://... 1answer 463 views ### Situations where revelation principle may not hold Revelation principle is a powerful statement regarding Bayesian Nash equilibrium. However it may not hold always, as where players do not fully know their preferences, or when preference elicitation ... 1answer 288 views ### Has the assumption that individuals' tastes do not change over time been rigorously challenged? In their seminal paper De Gustibus non est Disputandum, Stigler and Becker (1977) surveyed four classes of phenomena widely believed to be inconsistent with the stability of tastes: addiction, ... 1answer 243 views ### Why do stock exchanges not operate at a fixed frequency? Would this not be more fair towards traders who don't trade at high frequency? And would it not be possible to distribute this fixed frequency to other exchanges, modulo relativity? The reason I'm ... 2answers 320 views ### How does GNU software development sustain economically? I apologise if this question is out of topic, but it is simultaneously an economy and a programming question. If it should go to another SE communality, please indicate me. In theory, GNU software is ... 3answers 10k views ### Why is money in circulation a liability of the central bank? We know that the money today is fiat currency, that it is money because the government says it's so. So when new money is printed or loaned out to the commercial banks by buying treasury bonds, ... 3answers 2k views ### CES Production Function with\rho>1$In using CES production functions of the form$f(x_1,x_2)=(x_1^\rho+x_2^\rho)^{1/\rho} $, we always assume that$\rho\leq1$. Why do we make that assumption? I understand that if$\rho>1, the ... 1answer 842 views ### Dynamic Optimization: What if the second order condition does not hold? Consider the following dynamic optimization problem \begin{align} &\max_u \int^T_0{F(x,u)dt}\\ \text{s.t.}~& \dot{x} = f(x,u) \end{align} FOCs The Hamiltonian is given by \begin{align} H(x,u,... 2answers 253 views ### When should a receiver randomize across actions in a signaling game? Suppose there is a signaling game with a finite message spaceM$, finite action space$A$, and finite type space$T\$. Even simpler, all sender types have identical preferences (the receiver just ...

15 30 50 per page
1
â€¦
3 4
5
6 7
â€¦
217