中山大学岭南学院 中级 宏观经济学 Macroeconomics Reviews2

(ⅲ)Unemployment rate
(Ⅱ)Very long run economic growth
(ⅰ)How to measure the growth rate
(1)Def.1: compound interest method Seek for g: (Taylor polynomials)
Outlines Ⅱ
(Ⅴ)More on microeconomics behind macroeconomics ⅰConsumption ⅱInvestment
(Ⅰ)Basic concepts and relations
Three very important Definition.
Equivalence of three approaches
(ⅱ)Price index
CPI or PPI measures the overall cost of services and goods bought by a typical consumer or producer. The GDP deflator, also called the implicit price deflator for GDP, is defined as the ratio of nominal GDP to real GDP.
Relations : GNP = GDP + Factor Payments From Abroad − Factor Payments to Abroad. NNP = GNP − Depreciation.*(Warning) National Income = NNP − Indirect Business Taxes.
K , L

4)Constant returns to scales
(2)Saving and Investment (Twosector economy)
I D sY K K sy (n )k k
The last equation is the key equation to Solow diagram. Convergence
g e 1 g n 0 n!
g

(2)Def.2: least squared method Linear regression model:
Y ln xt a0 gt , ~ N (0, )
2
Seek for g:
min Q (a0 , g )
n
gW (u u )
e n


gW
e


b Y Y * Y* 或Pt 1 Pt [1 (Y Y *)]
e t 1
P t 1 P P t (Y Y *)
Notes and Comments
gw
Pt
is the growth rate of nominal wage.
CPI & PPI VS GDP deflator
Distinctions: 1) CPI or PPI :fixed basket (kinds and quantities); GDP deflator: varied weights
2) CPI or PPI :small basket; GDP deflator :large basket 3) CPI or PPI :can include imports GDP deflator: excludes imports
(ⅰ)GDP VS GNP
(ⅱ)Price index (ⅲ)Unemployment rate
(ⅰ)GDP VS GNP
Gross domestic product (GDP) is the
market value of all final goods and services produced within a country in a given period of time. Gross national product GNP is the total income earned by a nation’s permanent residents (called nationals).
How to measure GDP?
Production approach —— Value added
Expenditure approach:
Y C I G NX NX Exports im ports
NOTES : Gross investments : physical stocks and include Depreciation and inventories Government purchases : excludes transfer payments
So first we should calculate the nominal and real GDP in 2010:
Nominal GDP=60,000*120+20*400,000 =15,200,000 Real GDP=50,000*120+10*400,000 =10,000,000 GDP deflator =15,200,000/10,000,000 *100=152
(Ⅲ)Business cycle
Long-run AS curve
(Ⅲ)Business cycle Short-run AS curve
From Phillips curve to short-run AS curve
Y Y * (u u*) Y* ＝2％
gW (u u )
F ( A, K , L) K ( AL)

1
3)Conclusion: In steady state ,
(Only holds under Harrod neutrality)
g y gk g
Other models --New growth theory
AK model
n
xt x0 (1 g )
t
ln xt ln x0 t ln(1 g ) ln xt ln x0 ln(1 g ) t ln xt ln x0 g t ln xt ln x0 lim g lim t 0 t 0 t x g d (ln x) / dt x
AK model with technical progress
(ⅲ)Growth accounting equation
and Comments
Growth theory mainly tells us how the economy realizes very long-run economic growth while the growth accounting equation tells us what factors determine the economic growth of output (per capita). In the long run, AS curve is vertical and at the potential level. The growth theory has told us why this vertical curve will shift.
Calculation for price indexes——CPI
Calculation for price indexes——GDP deflator
Let’s make 2000 the base year, how to calculate the GDP deflator in 2010? Recall that
n i 1
s.t
2
Q(a0 , g ) ( yi a0 gti )
(ⅱ)Growth model
Four dimensionalities:
total VS per capita Capital VS output Short-run VS long-run Level VS growth rate
Macroeconomics Reviews ----Cen Hui
Outlines Ⅰ
(Ⅰ)Basic concepts and relations (Ⅱ)Very long run economic growth (Ⅲ)Business cycle (Ⅳ)Macroeconomic policy theory： ⅰ Three objectives of macroeconomic ⅱ Stabilization policy ⅲ Debates
S I gross
Solow Diagram
y
y*
(n )k
sy
k*
k
Equilibrium
Comparative Statics
Comparative Statics
Other models --Solow model (with technical progress)
1)real values-------effective values-------real values 2)Harrod neutrality: A---efficiency of labor AL---effective labor
is determined by the equilibrium of Period t and is the parameter of the short-run AS curve in Period t+1.