Public Administration
APPLIED MACROECONOMICS
W.J.M. Heijman
CONTENTS
Preface
CHAPTER 1: INTRODUCTION
1.1 Background
1.2 Targets of economic policy
1.3 Instruments of economic policy
1.4 Tinbergen’s view on economic policy
1.5 The value of economic activity
Questions and exercises
Appendix 1.1
1
1
2
5
10
13
16
17
CHAPTER 2: BASIC MACROECONOMIC MODELS
2.1 The models
2.2 Closed economy, fixed prices
2.3 Closed economy, fixed prices, government budget
2.4 International trade, fixed prices, government budget
2.5 A two country model of international trade
Questions and exercises
Case 2.1
Appendix 2.1
Appendix 2.2: Matrix operations in Excel
18
18
18
22
27
29
31
31
32
33
CHAPTER 3: IS-LM ANALYSIS
3.1 Introduction
3.2 Closed economy, fixed prices, monetary sector
Questions and exercises
3.3 Closed economy, fixed prices, government budget, monetary sector
Questions and exercises
3.4 Open economy, fixed prices, government budget
3.5 Open economy, fixed prices, government budget, monetary sector
Questions and exercises
3.6 Estimation of coefficients
Case 3.1
Case 3.2
Appendix 3.1: Linear regression with Excel
Appendix 3.2: Time series of macroeconomic variables
36
36
36
42
43
45
46
47
54
55
56
57
58
60
CHAPTER 4: AGGREGATE DEMAND AND AGGREGATE
SUPPLY ANALYSIS
4.1 Introduction
4.2 AD-AS in a closed economy
Questions and exercises
4.3 Aggregate Demand and Aggregate Supply in an open economy
Questions and exercises
Case 4.1
61
CHAPTER 5: THEORY OF THE BUSINESS CYCLE
5.1 Long-term and medium-term fluctuations
5.2 The long term: Schumpeter’s theory on cyclical growth
Questions and exercises
5.3 The medium-term business cycle: the Multiplier-Accelerator model
Questions and exercises
5.4 Capital and the business cycle
5.5 Investments
Questions and exercises
5.6 Multiplier-Accelerator-Capital (M-A-C) Model
Questions and exercises
5.7 Cyclical unemployment
Questions and exercises
Appendix 5.1
W.J.M. Heijman
CONTENTS
Preface
CHAPTER 1: INTRODUCTION
1.1 Background
1.2 Targets of economic policy
1.3 Instruments of economic policy
1.4 Tinbergen’s view on economic policy
1.5 The value of economic activity
Questions and exercises
Appendix 1.1
1
1
2
5
10
13
16
17
CHAPTER 2: BASIC MACROECONOMIC MODELS
2.1 The models
2.2 Closed economy, fixed prices
2.3 Closed economy, fixed prices, government budget
2.4 International trade, fixed prices, government budget
2.5 A two country model of international trade
Questions and exercises
Case 2.1
Appendix 2.1
Appendix 2.2: Matrix operations in Excel
18
18
18
22
27
29
31
31
32
33
CHAPTER 3: IS-LM ANALYSIS
3.1 Introduction
3.2 Closed economy, fixed prices, monetary sector
Questions and exercises
3.3 Closed economy, fixed prices, government budget, monetary sector
Questions and exercises
3.4 Open economy, fixed prices, government budget
3.5 Open economy, fixed prices, government budget, monetary sector
Questions and exercises
3.6 Estimation of coefficients
Case 3.1
Case 3.2
Appendix 3.1: Linear regression with Excel
Appendix 3.2: Time series of macroeconomic variables
36
36
36
42
43
45
46
47
54
55
56
57
58
60
CHAPTER 4: AGGREGATE DEMAND AND AGGREGATE
SUPPLY ANALYSIS
4.1 Introduction
4.2 AD-AS in a closed economy
Questions and exercises
4.3 Aggregate Demand and Aggregate Supply in an open economy
Questions and exercises
Case 4.1
61
CHAPTER 5: THEORY OF THE BUSINESS CYCLE
5.1 Long-term and medium-term fluctuations
5.2 The long term: Schumpeter’s theory on cyclical growth
Questions and exercises
5.3 The medium-term business cycle: the Multiplier-Accelerator model
Questions and exercises
5.4 Capital and the business cycle
5.5 Investments
Questions and exercises
5.6 Multiplier-Accelerator-Capital (M-A-C) Model
Questions and exercises
5.7 Cyclical unemployment
Questions and exercises
Appendix 5.1
References: Wim Heijman Wageningen, February, 2000. W.J.M. Heijman, E.P. Kroese and E.A. Oskam, 1994. Grondslagen van de macro-economie. Stenfert Kroese, Houten. relationships (Gordon, 1993, p.5).