Introduction to Dynamic Macroeconomic Theory: An Overlapping Generations ApproachEconomies are constantly in flux, and economists have long sought reliable means of analyzing their dynamic properties. This book provides a succinct and accessible exposition of modern dynamic (or intertemporal) macroeconomics. The authors use a microeconomics-based general equilibrium framework, specifically the overlapping generations model, which assumes that in every period there are two generations which overlap. This model allows the authors to fully describe economies over time and to employ traditional welfare analysis to judge the effects of various policies. By choosing to keep the mathematical level simple and to use the same modeling framework throughout, the authors are able to address many subtle economic issues. They analyze savings, social security systems, the determination of interest rates and asset prices for different types of assets, Ricardian equivalence, business cycles, chaos theory, investment, growth, and a variety of monetary phenomena. Introduction to Dynamic Macroeconomic Theory will become a classic of economic exposition and a standard teaching and reference tool for intertemporal macroeconomics and the overlapping generations model. The writing is exceptionally clear. Each result is illustrated with analytical derivations, graphically, and by worked out examples. Exercises, which are strategically placed, are an integral part of the book. |
From inside the book
Results 1-3 of 61
... hold , Equation ( 2.3 ) also holds . We also need to show that the equivalence works in the other direction . And , finally , we need to show how we find , for any pair of consumptions that fulfill Equation ( 2.3 ) , the h ( t ) that ...
... hold in an equilibrium . If rm ( t ) > r ( t ) , then everyone would want to borrow an infinite amount at the lower private market interest rate and spend an infinite amount on fiat money . The reserve requirement ( Equation 12.3 ) is ...
... hold only fiat money or everyone would hold only bonds . The assumption that everyone is iden- tical is crucial for this condition to hold . If there were diversity among individuals , the equality of utility condition might not hold ...
Contents
Competitive Equilibrium | 32 |
Introducing a Government | 55 |
5 | 65 |
Copyright | |
11 other sections not shown