59 questions · 26 almanac · 0 findings

Macroeconomics

The study of economies at the aggregate level.

Almanac Economics Learns to Show Its Work
  • What is Samuelson's correspondence principle, and how does it link stable equilibria to testable predictions?
  • How did Samuelson's 1948 textbook shape the way generations of students learned economics?
  • What is the neoclassical synthesis that Samuelson's textbook popularized?
Almanac Teaching Governments to Read Their Own Economy
  • How did governments measure economic performance before Simon Kuznets developed national income accounting?
  • What is the Kuznets curve, and what does it claim about inequality during industrialisation?
  • Why did Kuznets himself warn that GDP measures output rather than welfare?
Almanac No Vote Can Be Perfectly Fair
  • What does the IS-LM framework model, and why did it become the standard teaching tool in macroeconomics?
  • Why do economists still debate whether the IS-LM model captures what Keynes originally meant?
Almanac Mapping an Economy's Tangled Circle
  • How does Leontief's input-output matrix represent the flow of goods between sectors of an economy?
  • Why was solving Leontief's equations impractical before the arrival of computers?
  • How is input-output analysis used today by governments assessing shocks like tariffs or energy crises?
Almanac Two Rivals Sharing One Podium
  • What did Gunnar Myrdal believe markets did to inequality without state intervention?
  • What did Friedrich von Hayek argue the price system does that no central planner could replicate?
  • Why did Myrdal later argue that the economics prize should be abolished?
Almanac Scarcity, Solved in a Filing Cabinet
  • How did Tjalling Koopmans arrive at similar mathematics through wartime shipping logistics?
  • How can scarcity problems in economics be expressed as systems of linear inequalities?
Almanac People Are Not Just Labour, They're Capital
  • How did Schultz's idea compare returns on education against returns on physical machinery?
  • What does Arthur Lewis's dual-sector model say happens to wages as workers move from farms to factories?
Almanac An Economy, Written as Equations
  • How did Lawrence Klein turn Keynesian macroeconomic theory into a system of equations that could model an entire national economy?
  • What was the Wharton Econometric Forecasting model, and who ended up using it?
  • What limitation did Klein himself recognize about econometric models of national economies?
Almanac Why Diversifying Isn't Just Prudence
  • How is Tobin's q ratio calculated, and what does a high or low q signal about business investment?
  • What connection did James Tobin have to the 1972 warnings about environmental limits to growth?
  • How did Tobin's Keynesian training at Harvard shape his approach to asset allocation?
Almanac The Regulator Slowly Switches Sides
  • What is regulatory capture, and why does Stigler argue that regulated industries end up controlling the agencies meant to restrain them?
Almanac Proving the Invisible Hand Could Work
  • What did Adam Smith claim about competitive markets that Gérard Debreu later set out to prove mathematically?
  • What mathematical tools did Debreu use in Theory of Value to prove that a general equilibrium of prices exists?
  • What conditions does Debreu's equilibrium proof require, and why are they difficult to find in real economies?
Almanac Adding Up a Whole Economy
  • Why were economic comparisons between countries unreliable before Richard Stone's national accounting framework?
  • How does a double-entry accounting system ensure that a country's income, production, and expenditure all add up to the same total?
  • Why might Richard Stone have been uneasy about GDP becoming the primary measure of a government's success?
Almanac The Measure of Our Ignorance
  • What did Robert Solow's 1956 growth model say happens to an economy that only accumulates capital?
  • Why is technological progress treated as 'exogenous' in the Solow growth model?
  • What is the 'Solow residual,' and why was it nicknamed the measure of our ignorance?
  • Why did the Nobel committee wait three decades after Solow's original paper to award the prize?
Almanac The Depression That Never Showed Up
  • What did Ravi Batra's 1987 book predict, and did it come true?
  • Why did the Ig Nobel committee credit Batra's book sales with averting the depression it predicted?
Almanac Policy Cannot Fool People Twice
  • What is the Lucas critique, and why did it unsettle macroeconomic modeling?
  • Why would workers and firms eventually cancel out the effects of a predictable government stimulus?
  • How did economists' views on rational expectations evolve after the Lucas critique was absorbed?
Almanac A Promise Only Believed If It Can't Be Broken
  • Why can't a government credibly promise not to inflate the economy if it retains full discretion over monetary policy?
  • How does Kydland and Prescott's time-inconsistency problem justify central bank independence?
  • What did Kydland and Prescott's real business cycle work attribute economic fluctuations to?
Almanac Workers Catch On, the Curve Breaks
  • What did the original Phillips curve claim about the relationship between inflation and unemployment?
  • How did Phelps show that worker expectations undermine the inflation-unemployment trade-off in the long run?
Almanac An Economy That Anticipates Its Own Policy
  • Why do rational expectations complicate the study of how policy affects the economy?
  • How do Sargent's and Sims's approaches complement each other in macroeconomic analysis?
Almanac Crime, Now Counted Toward GDP
  • What EU mandate led Italy's statistics agency to include illegal activity revenue in GDP calculations?
  • Which illegal activities did ISTAT fold into Italy's official national accounts?
Almanac Putting Climate and Ideas Inside the Model
  • How did William Nordhaus's DICE model attempt to put a dollar figure on climate change?
  • What does it mean for ideas to be 'non-rival' in Paul Romer's growth theory?
  • Why had mainstream economic growth models left out both the environment and innovation for so long?
Almanac Ideas, Not Capital, Compound Fastest
  • What is Schumpeter's idea of creative destruction, and how did Aghion and Howitt formalise it into a growth model?
  • Why had earlier economic models treated productivity growth as an unexplained residual?