## 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 158

After a little algebraic manipulation, we get the function P(t) =MP'(t + i)) 2d(t + 1) +

2p\t + 1) 2d(t + 1) + 2/>'(< + 1) + 1' (6.11) This function is graphed in

the cases where d(t + 1) = 0 (the solid line), d(t + 1) = .5 (the dashed line), and ...

After a little algebraic manipulation, we get the function P(t) =MP'(t + i)) 2d(t + 1) +

2p\t + 1) 2d(t + 1) + 2/>'(< + 1) + 1' (6.11) This function is graphed in

**Figure**6.1 forthe cases where d(t + 1) = 0 (the solid line), d(t + 1) = .5 (the dashed line), and ...

Page 204

0 0.2 0.4 0.6 0.8 1 time t+3 price

= .95 and p(t) = .43. In

of 0; and using the curve in

0 0.2 0.4 0.6 0.8 1 time t+3 price

**Figure**7.9c curve in**Figure**7.9b ends at p(t + 2)= .95 and p(t) = .43. In

**Figure**7.9a one can see that a p(t + 2) = .95 gives a p(t + 1)of 0; and using the curve in

**Figure**7.9a again, we see that p(t + 1) = 0 gives ...Page 228

The Cobb-Douglas production function has this characteristic.

graph) shows the output that is generated using different amounts of capital and

a fixed amount of labor with a production function like the one in Equation (9.1).

The Cobb-Douglas production function has this characteristic.

**Figure**9.1 (uppergraph) shows the output that is generated using different amounts of capital and

a fixed amount of labor with a production function like the one in Equation (9.1).

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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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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 Proposition purchase quantity rate of growth 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