## Introduction to Dynamic Macroeconomic Theory: An Overlapping Generations ApproachEconomies are constantly in flux, and economists have long sought reliable means of analysing their dynamic properties. This book aims to provide a succinct and accessible exposition of modern dynamic (or intertemporal) macroeconomics. |

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Page 267

normally think of as prices. This price tells us how many goods are given up to

purchase 1 unit of money. Normally, prices are denominated in units of money, a

certain ...

**Inflation**The price of money that we have been using, pm(t), is not what wenormally think of as prices. This price tells us how many goods are given up to

purchase 1 unit of money. Normally, prices are denominated in units of money, a

certain ...

Page 284

It is important to remember that the Bailey curve represents the revenues for

economies that are in stationary monetary equilibria at the particular

. In economies that are in a nonstationary equilibrium, we cannot determine from

...

It is important to remember that the Bailey curve represents the revenues for

economies that are in stationary monetary equilibria at the particular

**inflation**rate. In economies that are in a nonstationary equilibrium, we cannot determine from

...

Page 285

Then find the period 1 revenue- maximizing

the seignorage equation given above.) How is the burden of the

shared between the young and old of period 1? In Exercise 10.12 we assumed

that ...

Then find the period 1 revenue- maximizing

**inflation**rate. You cannot simply usethe seignorage equation given above.) How is the burden of the

**inflation**taxshared between the young and old of period 1? In Exercise 10.12 we assumed

that ...

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### Contents

Describing the Environment | 5 |

Competitive Equilibrium | 32 |

Introducing a Government | 55 |

Copyright | |

10 other sections not shown

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### Common terms and phrases

45-degree line A-period bonds aggregate savings function amount arbitrage assets autarky Bailey curve bequests bliss point borrowing and lending budget line capital stock Chapter chooses competitive equilibrium Consider an economy consumption allocation consumption point consumption when old consumption when young credit controls crop endowment point equal Equation equilib equilibrium condition equilibrium price example economy exchange rate EXERCISE expected price fiat money Figure given gives government bonds government revenues gross interest rate growth rate hold indifference curve individual h inflation labor lifetime budget constraint market clearing maximize member h money creation money supply output Pareto optimal Pareto superior perfect foresight period person h pm(t present value price of land price path price sequence private borrowing production function Proposition purchase quantity rate of return reserve requirement restrictions result Ricardian equivalence seignorage solve stationary equilibrium stationary monetary equilibrium storage sumption tax-transfer scheme taxes and transfers temporary equilibrium tion utility function