Documente Academic
Documente Profesional
Documente Cultură
Macroeconomics
Economics 514
Macroeconomic Analysis
What is Macroeconomics
Macroeconomics
examines economies
at the aggregate (international, national,
regional) level.
Some aspects of macroeconomics are
about comparing two aggregate
economies at the same time.
Amateur History of
Macroeconomics/Macroeconomic History
Around
US Great Depression
Macro theory
UK
60
65
70
75
80
85
JAPAN_GDP
90
95
00
20000
200000
10000
100000
0
0
-10000
-20000
55
60
65
70
75
JAPAN_GDP
80
85
Trend
90
95
Cycle
00
Macro Progresses
During
Neo-classical synthesis
Growing
prominence of optimization
theory and marginal analysis in
microeconomics led to incorporation into
macroeconomic models.
Optimal models of saving, investment
and demand for liquidity were used to
describe a medium term equilibrium
around which the economy would
fluctuate in the short-run.
Marginal Analysis
Simple
principal of optimization of
smooth functions is the first derivative of
function should equal zero at extremum.
Economists consider the costs C and
benefits B of some activity A. Net benefit
of activity is B(A)-C(A).
Optimal level of A is B(A*) = C (A*) , i.e.
where the marginal benefit equals the
marginal cost.
Models by Term
Long-term:
Monetarism
In
120
115
110
105
100
95
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
Stagflation 70s
During
International Economics
In
Jun-1980
Jun-1984
Jun-1988
Jun-1992
Jun-1996
Jun-2000
Jun-2004
Rational Expectations
Lucas
Eighties
U.S.
Endogenous Growth
Productivity
1990s
Globalization:
Structural Unemployment in HK
HK: Unem ploym ent Rate
%
9
2
Jun-1996
Jun-1997
Jun-1998
Jun-1999
Jun-2000
Jun-2001
Jun-2002
Jun-2003
Jun-2004
Economists
This course
Divide
Focus
Develop
Requirements
3