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necessary building block of business cycle theory, economists have yet to provide a completely satisfactory explanation for it …
Persistent link: https://www.econbiz.de/10012470853
This essay offers a brief history of macroeconomics, together with an evaluation of what has been learned over the past several decades. It is based on the premise that the field has evolved through the efforts of two types of macroeconomist-- those who understand the field as a type of...
Persistent link: https://www.econbiz.de/10012466316
This essay discusses the role of Milton Friedman's presidential address to the American Economic Association, which was given a half century ago and helped set the stage for modern macroeconomics. We discuss where macroeconomics was before the address, what insights Friedman offered, where...
Persistent link: https://www.econbiz.de/10012453670
Persistent link: https://www.econbiz.de/10012467535
The paper develops a model of foreign direct investments (FDI) and foreign portfolio investments (FPI). FDI is characterized by hands-on management style which enables the owner to obtain relatively refined information about the productivity of the firm. This superiority, relative to FPI, comes...
Persistent link: https://www.econbiz.de/10012467640
An income tax is generally levied on both capital and labor income. The working young bears mostly the burden of the tax on labor income, whereas the retired old, who already acummulated her savings, bears the brunt of the capital income tax. Therefore, there arise two types of conflict in the...
Persistent link: https://www.econbiz.de/10012467720
The note analyzes how globalization forces induce monetary authorities, guided in their policies by the welfare criterion of a representative household, to put greater emphasis on reducing the inflation rate than on narrowing the output gaps
Persistent link: https://www.econbiz.de/10012467733
Migration of young workers (as distinct from retirees), even when driven in by the generosity of the welfare state, slows down the trend of increasing dependency ratio. But, even though low-skill migration improves the dependency ratio, it nevertheless burdens the welfare state. Recent studies...
Persistent link: https://www.econbiz.de/10012468008
The behavior of taxes on capital income in the recent decades points to the notion that international tax competition that follows globalization of capital markets put strong downward pressures on the taxation of capital income; a race to the bottom. This behavior has been perhaps most pronounced...
Persistent link: https://www.econbiz.de/10012468062
The New-Keynesian aggregate supply derives from micro-foundations an inflation-dynamics model very much like the tradition in the monetary literature. Inflation is primarily affected by: (i) economic slack; (ii) expectations; (iii) supply shocks; and (iv) inflation persistence. This paper...
Persistent link: https://www.econbiz.de/10012468400