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5 votes
Accepted

Challenging question on mathematical economics

What I say below in my answer is what I can say without having read Acemoglu and Autor's article (unfortunately I haven’t it), an answer based on what you report in your question, of course. I ...
BakerStreet's user avatar
  • 3,887
3 votes

Derivation of the Ideal Price Index

The price index is given by $c(p_L, p_H,1)$ which is the minimal cost of producing 1 unit of output. It is given by: $$ \min p_L Y_L + p_H Y_H \text{ s.t. } \left[\gamma_L Y_L^{(\varepsilon -1)/\...
tdm's user avatar
  • 12.3k
3 votes

Net effect of govt spending and tax cuts

The answer would depend on a lot of factors, such as what is the government money spent on, what is the tax regime etc. For starters, let us look at what would happen in different time scales. We can ...
Ishan Kashyap Hazarika's user avatar
2 votes
Accepted

Properties of Multivariate Frechet Distributions

1 $\begin{aligned} \operatorname{Pr}\left(A_j Z_j \leq z\right)=\operatorname{Pr}\left(Z_j \leq \frac{z}{A_j}\right)=F\left(\frac{z}{A_j}\right) =\exp \left(-\left(\frac{z}{A_j}\right)^{-\theta}\right)...
Alalalalaki's user avatar
  • 2,474
2 votes

What is equilibrium economics

To use a physics analogy: A physicist studying a damped oscillation is doing physics, a physicist studying a boring pendulum at rest is doing "equilibrium physics". Most (but not all) ...
VARulle's user avatar
  • 6,964
2 votes

What is equilibrium economics

Many economic models analyze the effects in equilibrium and often “solving” a model means finding the equilibrium. So, the conclusions of models are often based on what happens in equilibrium. I.e. if ...
BB King's user avatar
  • 6,188
2 votes

Net effect of govt spending and tax cuts

So would it result in a net zero change to the economy? Or would there be other effects which come into play? No, With non distortionary tax there would be almost no change to the economy, but ...
1muflon1's user avatar
  • 56.9k
1 vote

Net effect of govt spending and tax cuts

The first-order effect, as you say, would simply be a transfer from the Government to Households. Consequently, the largest impact will be distributional, which as you say shouldn't have a large ...
matthewoulton's user avatar
1 vote
Accepted

A question about Lagrangian, KKT theorem, consumer's problem

The Lagrangian can be written as $$L(C_1,C_{21},C_{31},C_{22},C_{32},S_1,S_{21},S_{22}) = p_1 \times u(C_1,C_{21},C_{31}) + p_2 \times u(C_1,C_{22},C_{32}) + \alpha(Y-C_1-S_{1}) + \lambda_2(Y+\...
Jesper Hybel's user avatar
  • 3,431
1 vote
Accepted

Why can't Russian CB influence on dollar?

Any foreign central bank can influence the dollar, but the extent of this influence depends on the amount of dollar reserves it intends to sell or buy. Any country's central bank can start selling its ...
A. Shultz's user avatar
1 vote
Accepted

Why limit the maximum size of deposit-CBDC transfers?

From what I understood : the main difference between Central Bank Digital Currencies deposits and Private Digital Currencies (i.e. your deposits in a commercial bank account) is that the Central Bank ...
krauuuus's user avatar
  • 105

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