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Основные показатели макроэкономики /english/

Real National Output and the price level in the intermediate range;
c) Increase the price level but not change Real National Output in the Classical range.
10. The ratchet effect is based upon the notion that prices are flexible upward but, relatively inflexible downward. Hence, an increaserease in AD will raise the price level, but in the short term prices cannot be expected to fall when demand decrease.
11. The basic aggregate demand and supply model is a springboard for a more detailed and comprehensive study of Macroeconomic analysis and issues.

Macroeconomic instability: unemployment & inflation
Unemployment
"Full unemployment is an elusive concept to define. A person might initially interpret it to mean that everyone who is in the labor market - 100% of the labor force - is employed. But such isn't the case some unemployment is regarded as normal or warranted.
Types of unemployment
Let us approach the task of defining full employment by distinguishing among several different types of employment.
Frictional unemployment
Given freedom to choose occupations & jobs, at any point in time some workers will be "between jobs". Some workers will be in the process of voluntarily switching jobs. Others will have been fired and are seeking reemployment. Still others will be temporarily laid off from their jobs cause of seasonally or modal changeovers as in automobile industry and there will be some workers particularly young people, searching for their first jobs. Economists use the term Frictional unemployment which consists of search unemployment and wait unemployment, for the group of workers who are either searching for jobs or waiting to take jobs to the near future. The adjective "frictional" implies that the labor market doesn't operate perfectly and instantaneously - that's without friction in matching workers & jobs. Frictional unemployment is regarded is inevitable and, at least inpart, desirable.
Structural unemployment
Frictional unemployment shades into a second category, called structural In this regard, economists use the term "structural" in the sense of "compositional". Important changes occur overtime in the "structure" of consumer demand and in technology which alter the structure of the total demand for labor. Because of suchchanges some particular skills will be in less demand or may even become obsolete. The demand for other skills will be expending, including new skills which previously did not exist. Unemployment results because the composition of the labor force doesn't respond weekly or completely to the new structure of job opportunities. As a result some workers find that they have no readily marketable talents; Their skills and experience have been rendered obsolets and unwanted by changes in technology and consumer demand.
This paragraph summary.
1. Our economy has been characterized by fluctuations in national output, employment and the price level. Although characterized by common phases - peak, recession, trough, recovery - business cycles vary greatly in duration and intensity.
2. Although the business cycle has been explained in terms of such ultimate causal factors as innovations, political events, and money creation, it is generally agreed that the level of total spending is the immediate determinant of national output and employment.
3. All sectors of the economy are affected by the business cycle but in varying ways and degrees. The cycle has greater output and employment reifications in the capital goods and durable consumer goods industries than is does in nondurable goods industries. Over the cycle, price fluctuations are greater in competitive than in monopolistic industries.
4. Economists distinguish between frictional, structural and cyclical unemployment. The full-employment or natural rate of unemployment is currently believed to be between 5 and 6%. The accurate measurement of unemployment is complicated by the existence of parttime and discouraged workers.
5. The economic cost of unemployment as measured by the GNP gap, consists of the goods & services which society foregoes when its resources are involuntarily idle. Okun's law suggests that every one person increase in unemployment above the natural rate gives rise to a 2.5%
GNP gap.
Classical & Keynesian theories of employment
1
. Classical employment theory envisonet laissez faire capitalism as being capable of providing virtually continous full employment. This analysis was based on Say's Law and the assumption of price-wage flexibility.
2. The classical economists argued that because supply creates its own demand, general overproduction was improbable. This conclusion was held to be valid even when saving occurred, cause the money market or most specifically, the interest rate, would automatically synchronize the saving plans of households and the investment plans of businesses.
3. Classical employment theory also held that even if temporary declines in total spending where to occur, these declines would be compensated for by downward price wage adjustments in such a way that real output, employment, and real income wouldn't decline.
4. Keyneisian employment theory rejects the notion that the interest rate would equate saving and investment by pointing out that savers & investors are substantially different groups who make their saving & investment decisions for different reasons - reasons which, for savers, are largely unrelated to the interest rate. Further more, because of changes in
a) The publics holdings of money balances;
b) Loans made by banks and other financial institutions, the supply of funds may exceed op fall short of current saving to the end that saving & investment will not be equal.
5. Keyneisian economists discredit price-wage flexibility on both practical and theoretical grounds. They argue that
a) Union and business monopolists, minimum-wage legislation, and a host of related factors have virtually eliminated the possibility of substantial price-wage reductions;
b) Price-wage cuts will lower total income and therefore the demand for labor.
6. The Classical & Keyneisian views can be illustrated through the AD-AS model. Classical economists envision
a) A vertical AS curve which establishes the level of output;
b) A stable AD curve which establishes the price level ;
Keyneisians see
a) A horizontal AS curve at less-than-full-employment levels of output;
b) Inherently unstable AD curve.
7. The basic tools of Key employment theory are the Consumption (C), Saving (S) and Investment (I) schedules, which show the various amounts that households intend to consume and save and that businesses plan to invest at the various possible income-output levels given a particular price level.
8. The locations of the consumption and Saving schedules are determined by such factors as:
a) The amount of wealth owned by households;
b) The price level;
c) Expectations of future income, future prices and product availability;
d) The relative size of consumer indebtedness;
e) Taxation;
The consumption and saving schedules are relatively stable.
9. The average propensities to consume and save show the proportion of fraction of any level of total income that is consumed and saved. The marginal propensities to consume and save show the proportion of fraction of any change in total income that is consumed or saved.
10. The immediate determinants of investment are:
a) The expected rate of net profit;
b) The real rate of interest
The economy's investment-demand curve can be determined by cumulating investment projects and arraying them in descending order according to their expected net profitability and applying the rule that investment will be profitable up to the point at which the real interest rate equals the expected rate of net profit. The investment-demand curve reveals and inverse relationship between the interest rate and the level of aggregate investment.
11. Shifts in the investment-demand curve can occur as the result of chances in
a) The acquisition, maintenance and operating costs of capital goods;
b) Business taxes;
c) Technology;
d) The stocks of capital goods on hand;
e) Expectations.
12. We make the simplifying assumption that the level of investment determined by the current interest rate and the investment-demand curve doesn't vary with the level of aggregate income.
13. The durability of capital goods, the irregular occurrence of major innovations profit volatility, and the variability of expectations all contribute to the instability of investment spending.
Equilibrium National output in Keynesian model
1
. For a closed no-government economy the equilibrium level of NNP is that at which the aggregate expenditures and national output are equal or graphically where the C + In line intersects the 45-degree line. At any NNP greater than the equilibrium NNP, national output will exceed aggregate spending resulting in unintended investment in inventories, depressed profits and eventual declines in output employment and income. At any below equilibrium NNP the aggregate expenditures will exceed the national output, thereby resulting in unintended disinvestment in inventories, substantial profits and eventual increases in NNP.
Fiscal Policy
1. Government responsibility for achieving and maintaining full employment is set forth in the Employment Act of 1946. The Council Economic Advisers (CEA) was established to advise the President on policies appropriate to fulfilling the goals of the act. The Humphrey-Hawkins Act of 1978 contains specific inflation and unemployment rate objectives.
2. Increases in government spending expand, and decreases contract, the equilibrium NNP. Conversely, increases in taxes reduce, and decreases expand the equilibrium NNP. Appropriate fiscal policy therefore calls for increases in government spending and decreases in taxes - that is, for a budget deficit - to correct for unemployment. Decreases in government spending and increases in taxes - that is, a budget surplus - are appropriate fiscal policy for correcting demand-pull inflation.
3. The balanced-budget multiplier indicates that equal increases in government spending and taxation will increase the equilibrium NNP by the amount of the increase in government expenditures and taxes.
4. Built-in stability refers to the fact that net tax (NT) revenues vary directly with the level of NNP. Therefore, during a rescission the public budget automatically tends toward a stabilizing deficit; Conversely, during expansion the budget automatically tends toward an anti-inflationary surplus. Built-in stability ameliorates, but doesn't correct, undesired changes in the NNP.
5. The full-employment budget indicates what the Federal budgetary surplus or deficit would be if the economy operated at full employment throughout the year. The full-employment budget is a more meaginful indicator of the government's fiscal posture than is its actual budgetary surplus or deficit.
6. The enactment and application of appropriate fiscal policy and subject to certain problems and question. Some of the most important are these
a) Can the enactment and application of fiscal policy be better timed so as to maximize its effectiveness in heading off economic fluctuations?
b) Can the economy rely upon Congress to enact appropriate fiscal policy?
c) An expansionary fiscal policy maybe weakened if it crowds out some private investment spending;
d) Some of the effect of an expansionary fiscal policy maybe dissipated in inflation;
e) Fiscal policy maybe rendered ineffective or inappropriate by unforeseen events occurring within the world economy. Also fiscal policy may precipitate changes in exchange rates which weaken its effects;
f) Supply-side economists contend that Keynesian fiscal policy fails to consider the effects of tax changes upon AS.
Monetary Policy
1. Like fiscal policy, the goal of monetary policy is to assist the economy in achieving a full-employment, noninflationary level of total output.
2. For a consideration of monetary policy the most important assets of the Federal Reserve Banks are securities and loans to commercial banks. The basic liabilities are the reserves of member banks, Treasury deposits & Federal Reserve Notes.
3. The three major instruments of monetary policy are
a) open-market operations;
b) changing the reserve ratio;
c) changing the discount rate;
4. Minor selective controls involve the margin requirement, consumer credit & moral suasion.
5. Keynesians envision monetary policy as operating through a complex cause-effect chain
a) policy decisions effect commercial bank reserves;
b) changes in reserves effect the supply of money;
c) changes in the supply of money alter the interest rate;
d) Changes in the interest rate affect investment, the equilibrium NNP and the price level;
6. The advantages of monetary policy include its flexibility and political acceptability. Further, monetarists feel that the supply of money is the single most important determinant of the level of national output.
7. Monetary policy is subject to a number of limitations and the problems
a) They excess reserves which an easy money policy provides may not be used by banks to expend the supply of money;
b) Policy-instigated changes in the supply of money maybe pertially offset by changes in the velocity of money;
c) The impact of monetary policy will be lessened if the money-demand curve is flat ant the
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