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Encyclopedia of Macroeconomics

ISBN: 9781840643879

Table of Contents

List of contributors of main entries

Preface

xxiii

Abramovitz, Moses

(1)

Absolute Income Hypothesis

(4)

Absorption Approach to the Balance of Payments

(1)

Accelerator Principle

(1)

Activism

(1)

Activist Policy Rule

(1)

Acyclical Variable

(1)

Adaptive Expectations

(4)

AD--AS Model

(7)

Adjustable Peg System

(1)

Adverse Selection Model

(1)

Aggregate Demand

(1)

Aggregate Demand Management

(2)

Aggregate Production Function

(1)

Aggregate Supply

(1)

Akerlof, George A.

(1)

Alesina, Alberto

(1)

American Economic Association

(1)

Animal Spirits

(1)

Anticipated Inflation

(1)

Appreciation (Nominal) of a Currency

(1)

Assignment Problem

(1)

Asymmetric Information

(1)

Automatic Stabilizers

(1)

Autonomous Expenditure

(1)

Average Propensity to Consume

(1)

Average Propensity to Save

(1)

Average Tax Rate

(1)

Balance of Payments

(1)

Balance of Payments-constrained Economic Growth

(6)

Balance of Payments: Keynesian Approach

(4)

Balance of Payments: Monetary Approach

(7)

Balanced Budget Multiplier

(4)

Barro, Robert J.

(1)

Bastard Keynesianism

(1)

Blanchard, Olivier J.

(1)

Blaug, Mark

(1)

Blinder, Alan S.

(1)

Boom

(1)

Bretton Woods

(5)

Brookings Institution

(1)

Brunner, Karl

(1)

Budget Balance

(1)

Budget Deficits: Cyclical and Structural

(4)

Built-in Stabilizers

(1)

Burns, Arthur F.

(1)

Business Cycle

(1)

Business Cycles: Austrian Approach

(4)

Business Cycles: Keynesian Approach

(5)

Business Cycles: Marxian Approach

(7)

Business Cycles: Monetarist Approach

(3)

Business Cycles: New Classical Approach

(6)

Business Cycles: Political Business Cycle Approach

(4)

Business Cycles: Real Business Cycle Approach

(4)

Business Cycles: Stylized Facts

(8)

Cagan, Philip D.

105

(1)

Calibration

105

(5)

Capital Account

110

(1)

Capital--Labour Ratio

110

(1)

Capital--Output Ratio

110

(1)

Capital-stock Adjustment Principle

110

(1)

Catching Up and Convergence

111

(3)

Central Bank

114

(1)

Central Bank Accountability and Transparency

115

(5)

Central Bank Independence

120

(5)

Central Parity

125

(1)

Classical Dichotomy

125

(4)

Classical Economics

129

(4)

Classical Model

133

(1)

Clean Float

133

(1)

Clower, Robert W.

134

(1)

Coddington, Alan

134

(1)

Cold Turkey

135

(1)

Comparative Advantage

135

(4)

Consumption Function

139

(1)

Contractionary Phase

139

(1)

Convergence

140

(1)

Coordination Failures

140

(5)

Cost-push Inflation

145

(1)

Council of Economic Advisers

145

(1)

Countercyclical Policy

145

(1)

Countercyclical Variable

146

(1)

Cowles Commission

146

(1)

Crawling Peg

146

(1)

Credibility and Reputation

146

(5)

Credit Channels

151

(5)

Credit Views in Macroeconomic Theory

156

(5)

Crowding Out

161

(4)

Current Account

165

(1)

Cyclical Unemployment

166

(1)

Cyclically Adjusted Budget Balance

166

(1)

Davidson, Paul

167

(1)

Deflation

167

(1)

Demand for Money: Buffer Stocks

167

(5)

Demand for Money: Friedman's Approach

172

(3)

Demand for Money: Keynesian Approach

175

(6)

Demand Management

181

(1)

Demand-deficient Unemployment

181

(1)

Demand-pull Inflation

181

(1)

Denison, Edward F.

182

(1)

Depreciation (Nominal) of a Currency

182

(1)

Depression

182

(1)

Devaluation

183

(1)

Dirty Float

183

(1)

Discount Rate

184

(1)

Discretionary Policy

184

(1)

Disinflation

184

(1)

Disposable Income

184

(1)

Domar, Evsey D.

184

(1)

Dornbusch, Rudiger

185

(1)

Dual Decision Hypothesis

185

(1)

Duesenberry, James S.

186

(1)

Ecological Macroeconomics

187

(4)

Econometric Society

191

(1)

Economic Growth

191

(1)

Economic Growth and the Role of Institutions

191

(9)

Efficiency Wage

200

(1)

Efficiency Wage Theory

200

(1)

Elasticities Approach to the Balance of Payments

201

(1)

Employment Act of 1946

201

(1)

Endogenous Growth Theory

202

(10)

Endogenous Variable

212

(1)

Equation of Exchange

212

(1)

Euro

212

(1)

European Central Bank

213

(1)

European Currency Unit

213

(1)

European Monetary System

213

(1)

European Monetary Union

214

(3)

European Union

217

(1)

Euroscelerosis

217

(1)

Evolutionary Macroeconomics

217

(4)

Ex Ante, Ex Post

221

(1)

Ex Post

221

(1)

Exchange Rate Determination: Monetary Approach

221

(3)

Exchange Rate Mechanism

224

(1)

Exogenous Variable

225

(1)

Expansionary Phase

225

(1)

Expectations-augmented Phillips Curve

225

(5)

Expenditure Reducing Policy

230

(3)

Expenditure Switching Policy

233

(4)

Federal Funds Rate

237

(1)

Federal Open Market Committee

237

(1)

Federal Reserve System

237

(1)

Feedback Rule

238

(1)

Feldstein, Martin

238

(1)

Financial Instability

239

(4)

Fine Tuning

243

(1)

Fiscal Policy: Role of

243

(5)

Fischer, Stanley

248

(1)

Fisher Effect

248

(1)

Fisher, Irving

249

(1)

Fixed Exchange Rate System

249

(10)

Flexible Exchange Rate System

259

(7)

Floating Exchange Rate System

266

(1)

Forecasting

267

(3)

Foreign Exchange Reserves

270

(1)

Foreign Trade Multiplier

270

(1)

Frictional Unemployment

271

(1)

Friedman, Milton

271

(13)

Frisch, Ragnar A.K.

284

(1)

Full Employment

285

(1)

Full Employment Budget Balance

285

(1)

Full Employment Output

286

(1)

Functional Finance

286

(1)

GDP Deflator

287

(1)

GDP in Current Prices

287

(1)

GDP in Real Prices

287

(1)

General Agreement on Tariffs and Trade

287

(1)

General Theory

288

(1)

Globalization

288

(5)

Gold Standard

293

(4)

Golden Age Growth

297

(1)

Gordon, Robert J.

298

(1)

Government Budget Constraint

299

(1)

Gradualism

299

(1)

Gradualism versus Cold Turkey

299

(1)

Great Depression

300

(7)

Great Inflation

307

(1)

Greenspan, Alan

308

(1)

Gross Domestic Product

308

(1)

Gross National Product

309

(1)

Group of Five

309

(1)

Group of Seven

309

(1)

Growth Accounting

309

(6)

Hansen, Alvin H.

315

(1)

Harrod, Roy F.

315

(1)

Harrod--Domar Growth Model

316

(5)

Hayek, Friedrich A. von

321

(1)

Heckscher--Ohlin Approach to International Trade

322

(1)

Hicks, John Richard

322

(4)

High-powered Money

326

(1)

Human Capital

326

(1)

Hume, David

326

(1)

Hydraulic Keynesianism

327

(1)

Hyperinflation

328

(1)

Hysteresis

328

(9)

Identity

337

(1)

Implementation Lag

337

(1)

Incomes Policy

337

(7)

Indexation

344

(1)

Inflation

345

(1)

Inflation: Alternative Theories of

345

(6)

Inflation: Costs of

351

(5)

Inflation: Costs of Reducing

356

(4)

Inflation Rate

360

(1)

Inflation Targeting

361

(4)

Inflation Tax

365

(1)

Inside Lag

365

(1)

Inside Money

366

(1)

Insider--Outsider Theory

366

(1)

International Monetary Fund

367

(2)

Intertemporal Substitution of Labour

369

(1)

Investment: Accelerator Theory of

369

(3)

Investment: Neoclassical Theories of

372

(5)

Involuntary Unemployment in Keynes's General Theory

377

(4)

Involuntary Unemployment in Keynesian Economics

381

(5)

IS--LM Model: Closed Economy

386

(5)

IS--LM Model: Open Economy

391

(6)

John Bates Clark Medal

397

(1)

Johnson, Harry G.

397

(1)

Jorgenson, Dale W.

398

(1)

Kahn, Richard F.

399

(1)

Kaldor, Nicholas

399

(1)

Kalecki, Michal

400

(1)

Keynes Effect

400

(1)

Keynes, John Maynard

401

(4)

Keynes's General Theory

405

(4)

Keynesian Cross

409

(2)

Keynesian Economics

411

(6)

Keynesian Economics: Reappraisals of

417

(4)

Kindleberger, Charles P.

421

(1)

Klein, Lawrence R.

422

(1)

Kuznets, Simon S.

422

(1)

Kydland, Finn E.

423

(2)

Laffer Curve

425

(7)

Leijonhufvud, Axel

432

(1)

Lender of Last Resort

433

(1)

Lerner, Abba P.

433

(1)

Lewis, W. Arthur

434

(1)

Life Cycle Hypothesis

434

(2)

Lipsey, Richard G.

436

(1)

Liquidity

437

(1)

Liquidity Preference

437

(1)

Liquidity Trap

437

(2)

Loanable Funds Theory

439

(1)

Long-run Phillips Curve

440

(1)

Lucas Critique

440

(5)

Lucas, Robert E. Jr

445

(8)

Lucas `Surprise' Supply Function

453

(2)

Macroeconometric Models

455

(3)

Malinvaud, Edmond

458

(1)

Managed Float

459

(1)

Mankiw, N. Gregory

459

(1)

Marginal Efficiency of Capital

460

(1)

Marginal Efficiency of Investment

460

(1)

Marginal Propensity to Consume

460

(1)

Marginal Propensity to Import

461

(1)

Marginal Propensity to Save

461

(1)

Marginal Propensity to Withdraw

461

(1)

Marginal Tax Rate

461

(1)

Marshall--Lerner Condition

461

(3)

Marxian Macroeconomics: An Overview

464

(5)

Marxian Macroeconomics: Some Key Relationships

469

(11)

Mayer, Thomas

480

(1)

Meade, James E.

481

(1)

Meltzer, Allan H.

481

(1)

Menu Costs

482

(4)

Minsky, Hyman P.

486

(1)

Mismatch Unemployment

487

(1)

Mitchell, Wesley C.

487

(1)

Modigliani, Franco

487

(3)

Monetarism

490

(4)

Monetary Approach to Exchange Rate Determination

494

(1)

Monetary Approach to the Balance of Payments

494

(1)

Monetary Base

495

(1)

Monetary Policy: Role of

495

(4)

Money Illusion

499

(1)

Money Supply: Endogenous or Exogenous?

500

(3)

Multiplier

503

(5)

Multiplier--Accelerator Model

508

(1)

Mundell, Robert A.

509

(4)

Mundell--Fleming Model

513

(1)

Muth, John F.

513

(1)

Nairu

514

(1)

National Bureau of Economic Research

514

(1)

National Income

514

(1)

Natural Rate of Unemployment

515

(3)

Neoclassical Growth Model

518

(4)

Neoclassical Synthesis

522

(4)

Net Capital Flows

526

(1)

Net Exports

526

(1)

Neutrality of Money

526

(7)

New Classical Economics

533

(6)

New Economy

539

(2)

New Keynesian Economics

541

(4)

New Neoclassical Synthesis

545

(1)

New Political Macroeconomics

546

(4)

Nobel Prize in Economics

550

(1)

Nominal Exchange Rate

551

(1)

Nominal GDP

551

(1)

Nominal Interest Rate

552

(1)

Nominal Rigidity

552

(6)

North American Free Trade Agreement

558

(1)

Okun, Arthur M.

559

(1)

Okun's Law

559

(1)

Open Economy Trilemma

560

(1)

Open Market Operations

561

(1)

Optimum Currency Area

561

(9)

Organization for Economic Cooperation and Development

570

(1)

Organization of Petroleum-exporting Countries

570

(1)

Outside Lag

570

(1)

Outside Money

571

(1)

Passive Policy Rule

572

(1)

Patinkin, Don

572

(1)

Peak

573

(1)

Permanent Income Hypothesis

573

(7)

Phelps, Edmund S.

580

(1)

Phillips Curve

581

(5)

Phillips, A. William H.

586

(1)

Pigou Effect

586

(1)

Pigou, Arthur C.

586

(1)

Policy Ineffectiveness Proposition

587

(1)

Post Keynesian Economics

588

(9)

Potential Output

597

(1)

Precautionary Balances

597

(1)

Prescott, Edward C.

597

(1)

Present Value

598

(1)

Price Index

598

(1)

Procyclical Variable

598

(1)

Productivity Slowdown

598

(1)

Public Sector Borrowing Requirement

599

(1)

Purchasing Power Parity Theory

599

(4)

Quantity Theory of Money

603

(5)

Random Walk

608

(1)

Rational Expectations

608

(3)

Reaganomics

611

(1)

Real Balance Effect

611

(4)

Real Business Cycle Model

615

(1)

Real Exchange Rate

615

(1)

Real GDP

615

(1)

Real Interest Rate

615

(1)

Real Money Balances

616

(1)

Real Rigidity

616

(4)

Real Wage

620

(1)

Recession

620

(1)

Recognition Lag

621

(1)

Relative Income Hypothesis

621

(1)

Replacement Ratio

622

(1)

Representative Agent Model

623

(5)

Reputation

628

(1)

Revaluation

628

(1)

Ricardian Equivalence

628

(4)

Robinson, Joan

632

(1)

Romer, Paul M.

632

(1)

Rostow, Walt W.

633

(1)

Rough Tuning

634

(1)

Royal Economic Society

634

(1)

Rules versus Discretion

634

(10)

Sacrifice Ratio

644

(1)

Samuelson, Paul A.

644

(5)

Sargent, Thomas J.

649

(1)

Say's Law

650

(3)

Schools of Thought in Macroeconomics

653

(7)

Schumpeter, Joseph A.

660

(1)

Schwartz, Anna J.

660

(1)

Search Unemployment

661

(1)

Seasonal Unemployment

661

(1)

Seigniorage

661

(1)

Shackle, George L.S.

661

(1)

Shirking Model

662

(1)

Shoe Leather Costs

662

(1)

Short-run Phillips Curve

663

(1)

Slump

663

(1)

Solow, Robert M.

663

(5)

Speculative Balances

668

(1)

Speculative Bubbles

668

(4)

Stabilization Policy

672

(1)

Stagflation

672

(2)

Staggered Wage Contracts

674

(1)

Steady State Growth

674

(2)

Sterilization

676

(1)

Stiglitz, Joseph E.

676

(1)

Stone, J. Richard N.

677

(1)

Structural Budget Balance

678

(1)

Structural Unemployment

678

(1)

Summers, Lawrence H.

678

(1)

Supply-side Economics

679

(11)

Taylor, John B.

690

(1)

Taylor's Rule

691

(1)

Temin, Peter

691

(1)

Term Structure of Interest Rates

692

(1)

Terms of Trade

693

(1)

Thatcherism

693

(1)

Theory and Measurement in Macroeconomics: Role of

693

(6)

Time Inconsistency

699

(4)

Tinbergen, Jan

703

(1)

Tobin, James

704

(5)

Tobin's Q

709

(1)

Trade Balance

709

(1)

Trade Union Density

709

(1)

Transactions Balances

709

(1)

Transitory Income

709

(1)

Trough

710

(1)

Unanticipated Inflation

711

(1)

Unemployed

711

(1)

Unemployment Rate

711

(1)

Vector Autoregressions

712

(4)

Velocity of Circulation

716

(1)

Wallace, Neil

717

(1)

Weintraub, Sidney

717

(1)

Wicksell, Knut

718

(1)

World Bank

718

(2)

World Trade Organization

720

(1)

Yield Curve

721