I estimate world demand for crude petroleum, the effect of petroleum prices on world income, and non OPEC supply of crude petroleum using seasonally adjusted data and a number of instruments. Structural breaks help explain stationarity in demand, and cointegration of variables suggests...

In scarcity markets, corporations use to consider the overall market demand as a group of homogeneous buyers. In controlled competition markets, companies stimulate non homogenous demand reactions to competitive supplies, by segmenting market demand. In over-supply markets, where instability is...

Consumption is the largest component of GDP. Since the 1950s, the life cycle and the permanent income models have constituted the main analytical tools to the study of consumption behavior, both at the micro and at the aggregate levels. Since the late 1970s the literature has focused on versions...

We propose a microeconomic foundation of the multiplier effect and that of the consumption function using a dynamic optimization model that explains a shortage of aggregate demand and unemployment. We show that government purchases boost aggregate demand through a multiplier-like process but...

The Chinese version of this paper can be found at http://papers.ssrn.com/abstract=1960697.This paper researches the consumers' behavior theory and the demand definition of mainstream economics and finds that these definitions are different and in contradiction. Therefore, this paper proposes the...

We propose a microeconomic foundation of the multiplier effect and that of the consumption function using a dynamic optimization model that explains a shortage of aggregate demand and unemployment. We show that government purchases boost aggregate demand through a multiplier-like process but...

We examine linkages between aggregate household income, distribution of that income, and aggregate cross-country expenditure patterns. We are able to decompose income effects into international income dispersion effects (from variations in average income) and national income dispersion (income...

We develop a Keynesian cross analysis with a dynamic optimization setting that explains long-run stagnation caused by aggregate demand deficiency. We show that an increase in government purchases boosts GDP through a multiplier process, but the implication is quite different from the...

Keynes introduces the term 'effective demand' in chapter 3 of the General Theory as designating the point of intersection of two functions: the 'aggregate demand function' (D) and the 'aggregate supply function' (Z). For the first time in the literature, I here specify exact functional forms for...