branch of economics dealing with the performance‚ structure‚ behavior‚ and decision-making of the whole economy. Macroeconomists study aggregated indicators such as GDP‚ unemployment rates‚ and price indices to understand how the whole economy functions. They develop models that explain the relationship between such factors as national income‚ output‚ consumption‚ unemployment‚ inflation‚ savings‚ investment‚ international trade and international finance. The two major theories of economics are Classical
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Keynesian Economics Definition Keynesian economics is based on the flawed theories of John Maynard Keynes. He was a 20th century British economist whose theories were documented in “The General Theory of Employment‚ Interest and Money‚” published in 1935. His ideas called for a mixed economy where both public and private sectors are involved‚ and was a proponent of at least some level of centrally planned inflation. While Keynes is loved by many who support strong centralized planning in the economy
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Lecture 1‚ 9 January 2014 -Pre-crash orthodoxies Draft: I.INTRODUCTION Students at Manchester University and elsewhere have been demanding to be taught ‘post-crash economics’. I want to start this set of six lectures with an account of pre-crash orthodoxies -the theories which underpinned economic policy till 2008; the orthodoxies students are still taught. In my next lecture I tell how the unforeseen crisis caused politicians and policy-makers to jettison these orthodoxies in saving the world from
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What are the characteristics of monetarism‚ and how did it come to dominate economic policy? Monetarism was an “important set of ideas that did emerge from the transatlantic non liberal network during the 1950’s and 1960s.” [Jones‚ 2012] Monetarism is a mixture of theoretical ideas‚ philosophical beliefs‚ and policy prescriptions. Monetarism is based on the belief that the economy is inherently stable and that markets work well when left to itself. Therefore Government intervention can often
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each of the two fiscal policy recommendations affects the national economy would depend largely on the applicable model or economic theory. Thus‚ to understand how budget deficit reduction or increased government spending and tax reduction would impact of unemployment‚ interest rates‚ expectations‚ and consumer income‚ it is important to give a brief overview of the Keynesian model and the
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War? How does it fit within the ideas of Hayek and Keynes? Use the stagflation of the 70s as an example. The post–World War II the postwar economic boom‚ also known as economic expansion‚ the long boom‚ and the Golden Age of Capitalism‚ and the Age of Keynes in western countries after the end of World War II in 1945. It was a high worldwide economic growth in Western European that had been devastated by the war such as unusually high and sustained growth‚ together with full employment. By
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John Maynard Keynes; Economics Assignment Table of contents Introduction…………………………………………..1 John Maynard Keynes‚ History and Background…....1-2 John Maynard Keynes Education Background………2-4 John Maynard Keynes Career…………………………4-6 Conclusion…………………………………………......6 Introduction John Maynard Keynes was a brilliant economist. Keynes is considered to be one of the founders of modern macroeconomics‚ and to be the most influential economist of
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Economic theories explore the relationships linking changes in the money supply to changes in economic activity and prices. With a mixture of theoretical ideas‚ philosophical beliefs‚ and policy prescriptions‚ these theories can help elaborate on both historic and current financial situations. For instance‚ the general understanding of the monetarist theory‚ founded by economist Milton Friedman‚ focuses on macroeconomic activities that examine the impact of changes in the money supply and central
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tools available to policy makers to alter total demand‚ output‚ and employment. This feature will focus on fiscal policy‚ what it is and its potential and limitations as a tool with which to promote economic stability and strong growth. What is Fiscal Policy? When the supply of money is economic constant‚ government expenditures must be financed by either taxes or borrowing. Fiscal policy involves the use of the government’s spending‚ taxing and borrowing policies. The government’s budget deficit
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Roger Farmer Working Paper 17479 http://www.nber.org/papers/w17479 NATIONAL BUREAU OF ECONOMIC RESEARCH 1050 Massachusetts Avenue Cambridge‚ MA 02138 October 2011 This paper was prepared as a Plenary Address to the 17th International Conference in Economics and Finance‚ held at the Federal Reserve Bank of San Francisco‚ June 29th-July 1st 2011. I would like to thank the Society for Computational Economics and the Federal Reserve Bank of San Francisco for supporting this event and the organizers
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