Search results

The purpose of this paper is to contribute to the teaching of undergraduate macroeconomics.

To suggest a roadmap, based on a consumption function, to be used by instructors willing to teach the Lucas Critique subject.

Therefore, this paper proposes a lesson, which consists of three parts, to help undergraduates better understand the subject: (1) a grading exercise to bring the topic closer to students’ lives; (2) a Keynesian and an optimal consumption function, followed by an example based on an unemployment insurance policy; and (3) two optional topics consisting of extensions of the optimal consumption function and some empirical results related to the Lucas Critique.

The Lucas Critique influenced the evolution of research in macroeconomics, but it is not easily grasped in a classroom.

The purpose of this article is to analyze the decline of two central metaphors of macroeconomics, economics and markets, and suggests ways in which metaphoric vigor can be initiated to promote economic reflection, inter-disciplinary collaboration, and more productive engagement with the broader society. Economics and markets can be described as dead metaphors which have ceased to provide any metaphoric advantage or potential but which nevertheless remain central to economic discourse. At a time when economics is coming under societal scrutiny and being asked to explain its assumptions, predictive ability and social impact, the perceived distance and sterility of economic language presents a significant problem.

The central approach is an analysis of the ways in which metaphor come into being, provide regenerative insights and communicate open and creative discourse. Metaphor theory is introduced, as are theoretical considerations on the decline of conceptual metaphor through over familiarization.

Metaphor in economics is underexplored and this article suggests that a more engaged and creative approach will provide benefit within the discipline and will be necessary to sustain the ongoing discourse with those outside the field.

This article provides new insight into the problems associated with the failure to recognize and to resuscitate metaphor in macroeconomics. It provides original perspectives on the problem, and presents novel suggestions for reducing the communication difficulties that metaphor failure has produced, particularly in communicating economic perspectives with the broader society.

David Gordon was, at once, a highly creative economist with an enormous range of interests, while also uncompromising in maintaining rigorous research standards. He focused equally on hard-core academic research and pressing policy issues. He was also openly committed to the political left, with this commitment animating all his work. One distinctive feature of Gordon’s work was his keenness to dive into the most important topics engaging mainstream economists and to inject explicitly left political economy perspectives into these mainstream debates. This paper focuses on two important examples of Gordon’s contributions that examine front-and-center mainstream macroeconomics questions. The first is the relationship between aggregate saving and investment. The second is the development of the concept of the “natural rate of unemployment.” The evolution of mainstream research on these two questions played a critical role in overturning what had been, over the first two post-World War II decades, a prevailing Keynesian/social democratic consensus, at both the levels of analytic economics as well as economic policy. As the paper reviews, Gordon challenges the analytic findings and policy implications of these perspectives at their core. Gordon’s own basic premises and results are straightforward. He argues that, in fact, investment decisions, not saving rates, are the main driver of economic activity in capitalist economies and that operating capitalist economies at something akin to genuine full employment – that is, in the range of 2–3 percent official unemployment – is a realistic goal. As such, these papers by Gordon contribute significantly toward envisioning a post-neoliberal social structure of accumulation that is committed to the egalitarian principles that were central to Gordon’s life work.

This introduction summarizes each of the papers in Studies in Austrian Macroeconomics. It begins with a brief overview of the core ideas and development of modern Austrian macroeconomics, focusing on its theory of the business cycle. The papers are then discussed by parts, starting with the papers on Austrian monetary and business cycle theory, followed by those addressing the relationship between the US and Canadian economic performance, and concluding with the three papers on the political economy of regulation and crisis.

The purpose of this study is to analyse numerous aspects affecting residential property price in Malaysia against macroeconomics issues such as gross domestic product (GDP), exchange rate, unemployment and wage.

The hedonic pricing model has been adopted as econometric model for this research to investigate the relationship between residential property price against macroeconomics indicator. The data for residential property price and macroeconomic variables were collected from 1991 to 2019. Multiple linear regression had been adopted to find the relationship between the dependent and independent variables.

The result shows that the GDP has a significant positive impact on residential property price, while exchange rate has no significant impact although it was positive. In addition, the unemployment rate has a significant impact on the residential property price and has a negative relationship. Similar to the wage that shows the negative relationship with residential property prices. Moreover, during the pandemic COVID-19 in Malaysia, this research shows a more transparent view of the relationship between residential property price and the macroeconomic issues of GDP, exchange rate, unemployment and wage.

The findings of this research found that macroeconomics issue cannot be eliminated due to Malaysia is a developing country, and there will always be an issue that will happen, but the issues can be reduced to maximise the advantages, e.g. during COVID-19, the solution to fight against COVID-19 were crucial and weaken the macroeconomics issues.

This essay aims to analyze the process of structural adjustment in developing countries. Its focus is on macroeconomic stabilization in the short‐term, but the analysis is situated in a wider context to consider how it relates to the implications of structural reform in the medium‐term and the prospects for economic growth in the long‐term.

The paper begins by setting out the contours of the orthodox, the Keynesian and the heterodox perspectives on stabilization and adjustment to highlight the differences. Such different perspectives on macroeconomic theory and policy, it suggests, are attributable to differences in objectives, assumptions and beliefs. These are made explicit.

The paper argues that the relationship between stabilization and growth is characterized by inter‐connections rather than trade‐offs and suggests that outcomes depend on modes of adjustment. It also provides a macroeconomic analysis of government deficits and public finances, which are critical in the process of adjustment. This highlights the macroeconomic significance of government deficits and points to the fallacies of deficit fetishism based on accounting frameworks. The intersection of economics and politics in the design and implementation of macroeconomic policies is also explored.

Going beyond a critique of orthodox stabilization programmes, it shows that there are alternatives in macro‐management for economies in crisis, for which it is necessary to shift the focus from the financial to the real economy, from the short‐term to the long‐term, and from equilibrium to development.

The paper develops a heterodox perspective on the macroeconomics of structural adjustment and public finances. And, it sets out an alternative framework which straddles time horizons, to understand the restructuring of economies over time.

The purpose of this paper is to develop an approach for investigating the impact of surveillance technologies used to facilitate security and its effect upon privacy.

The authors develop a methodology by drawing on an isomorphy of concepts from the discipline of Macroeconomics. This proposal is achieved by considering security and privacy as economic goods, where surveillance is seen as security technologies serving identity (ID) management and privacy is considered as being supported by ID assurance solutions.

Reflecting upon Ashby's Law of Requisite Variety, the authors conclude that surveillance policies will not meet espoused ends and investigate an alternative strategy for policy making.

The result of this exercise suggests that the proposed methodology could be a valuable tool for decision making at a strategic and aggregate level.

The paper extends the current literature on economics of privacy by incorporating methods from macroeconomics.

Professor Shackle has long maintained both the originality of the liquidity preference theory of interest rates and its paramount importance for macroeconomics. He has argued, for example, that:

The purpose of this paper is to provide logical and empirical explanations as to why monetary policy is ineffective with respect to affecting mortgage rates, and thus investment and aggregate demand.

Logical and empirical evidence is provided in support of the hypothesis that changes in the money supply have no significant impact on interest rates in general, and particularly on mortgage rates. This empirical analysis is based on a simple regression of changes in mortgage rates on changes in the money supply, and covers the 1990‐2004 period.

Support was found for our hypothesis that changes in money supply have no significant impact on interest rates.

The conclusion of this paper should be incorporated in all macroeconomics textbooks. Lack of such analyses may leave a confusing or misleading impression about economic theories in the mind of economics students.

One should not rely on monetary policy as an effective tool of stabilization policy.

The message of this paper is to readers of macroeconomics textbooks. This paper has an original value in that it communicates to readers that most macroeconomic textbooks fail to provide detailed and clear explanations as to why very frequently monetary policy does not achieve its objective of stabilizing the economy.