In recent weeks, fears of a worldwide economic recession have become widespread because more and more symptoms appear that resemble those at the start of the great depression of 1929. However, wrong conclusions may be drawn from similar symptoms unless basic development trends as well as the...

"This paper reviews selected studies in the theory of macroeconomic stabilization policy and summarizes their key findings. A simple model is constructed which includes all surveyed models as special cases. All solutions are derived and described step by step"--Federal Reserve Bank of...