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 77
... tion requires that the marginal rate of substitution ( MRS ) be equal to the gross interest rate ( Equation 2.5 ) ; and for time period 1 , this condition is ́duh ( ch ( 1 ) , ch ( 2 ) ) ] [ du } ( ch ( 1 ) , ch ( 2 ) ) r ( 1 ) = MRS ...
... tion 0 care about anyone else , the economy from time 2 and onward ( when the members of generation 0 have all died off ) is identical to the selfish economies we have looked at already . For this reason , we concentrate , here , on ...
... tion by member h of generation 0 and an increase of 1 unit of consump- tion by member h of generation 1. The 45 - degree line extending north- west from the time 1 after - tax endowment point , [ wh ( 1 ) — th ( 1 ) , w } ( 1 ) — t ...
Contents
Describing the Environment | 5 |
Competitive Equilibrium | 32 |
Introducing a Government | 55 |
Copyright | |
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