This chapter contains the capital theory controversy that took place among the most important economists from the universities of Cambridge (UK) and Cambridge (Mass.). First, we present the neoclassical propositions which are summarized in the neoclassical parables. The second section contains...

This is an introductory chapter to the theory of economic growth. It starts analyzing the objet of the growth theory and the distinction between long term growth and fluctuations. The chapter includes data about Gross Domestic Product (GDP) and GDP per capita for different countries from a...

This chapter contains the keynesian and neoclassic models by which it was initiated the theory of economic growth. The main concern in these models is the possibility of growth with stability and full employment. First, we present models with an exogenous propensity to save: the Keynesian models...

The third part, which consists of four chapters, presents the Mundell-Fleming model; the model of aggregate supply and demand; expectations and contracts as determinants of aggregate supply; the Phillips curve, and the model incorporating the Monetary Policy Reaction Function. The development of...

The seventh chapter presents the IS-LM model of simultaneous equilibrium in the goods and services market and the money market. IS-LM model determines the Aggregate Demand and, consequently, the level of output and employment, under the assumption of fixed prices or infinitely elastic Aggregate...

The second part, which consists of three chapters, shows the Keynesian income expenditure model, the money market and the IS-LM model. The fifth chapter presents the components of aggregate expenditure or Demand, and develops a model of income determination in the short term. Then, it studies...

The fourth part, which consists of three chapters (12, 13 and 14), deals with macroeconomic policy in a full employment context. It analyses the labor market and its relationship with Aggregate Supply; then it presents the IS-LM model including this relation; and investment-saving relation in a...

The sixth chapter introduces the concept of money and its functions, as well as supply for money, demand for money and equilibrium in money market.

This is the first part of the book. It consists of four chapters which contain a brief history of macroeconomics, the basic concepts of national accounts, the circular flow of the economy, and other concepts related to an open economy. The classical economists, Smith and Ricardo, are considered...

The third part, which consists of four chapters, presents the Mundell-Fleming model; the model of aggregate supply and demand; expectations and contracts as determinants of aggregate supply; the Phillips curve, and the model incorporating the Monetary Policy Reaction Function. This chapter...