Supply versus demand approaches to the problem of stagflation
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Supply versus demand approaches to the problem of stagflation by Bruno, Michael.

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Published by Maurice Falk Institute for Economic Research in Israel in Jerusalem .
Written in English

Subjects:

  • Inflation (Finance) -- Mathematical models,
  • Unemployment -- Effect of inflation on -- Mathematical models,
  • Supply and demand -- Mathematical models

Book details:

Edition Notes

Statementby Michael Bruno and Jeffrey Sachs.
SeriesDiscussion paper / Maurice Falk Institute for Economic Research in Israel -- no. 796, Discussion paper (Makhon le-meḥḳar kalkali be-Yiśraʾel ʻal-shem Moris Falḳ) -- no. 796
ContributionsSachs, Jeffrey.
Classifications
LC ClassificationsHG229 B79 1979
The Physical Object
Pagination65 p. --
Number of Pages65
ID Numbers
Open LibraryOL18724689M

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We develop a model of aggregate supply and demand in the open economy to explain the important characteristics of international macroeconomic adjustment in the s. Traditional demand-oriented models cannot account for the worldwide phenomenon of rising inflation and unemployment in the mids, or for the failure of most industrialized economies to recover from the deep recession of Cited by: When aggregate supply is carefully treated, it is found that much of the inflation and sluggish output performance may be attributed to the jump in the real costs of intermediate inputs and the failure of real wages to adjust downward after the input price : Michael Bruno and Jeffrey D. Sachs. The sketch presents a picture of systemic, long-term (i.e., noncyclical) problems caused by the fact that supply and demand are partly interdependent and partly independent and that supply is insensitive to changes in demand. The problems are not related fundamentally to where we are in the current business cycle (at this writing, December   The opposite of supply side economics is demand side economics. Demand side economics is all about increasing demand in the consumer. This has been referred to as Keynesian economics. The idea here is that the quickest way to spur demand is to increase the relative wealth of the people who want to make s:

Supply and Demand: A Generic View. If we look at the supply/demand structure from a more generic perspective, we can use it to describe any situation in which an ability to supply a good or service is being balanced with the demand, utilization, or consumption of that product or service. If we add Nathan and Joe's demand functions, we get: At $5 a game, both Nathan and Joe will have positive demand for video games, and so we can use the combined equation to get Q = [78 - 7(5)] = 43 games. At $11 a game, however, Nathan's demand function gives negative demand, which we know means he just has 0 demand for video games. expand the money supply to increase aggregate demand The stagflation experienced in the U.S. during the late s and the s showed us that the relationship between unemployment and inflation was not as clear—cut as presented on. Bruno and Sachs: w Supply vs. Demand Approaches to the Problem of Stagflation: Barsky and Kilian: w A Monetary Explanation of the Great Stagflation of the s: Blanchard: w The Lucas Critique and the Volcker Deflation: Blinder and Rudd: The Supply-Shock Explanation of the Great Stagflation Revisited: Barsky and KilianCited by:

w Supply vs. Demand Approaches to the Problem of Stagflation: Blinder and Rudd: w The Supply-Shock Explanation of the Great Stagflation Revisited: Goodfriend: w How the World Achieved Consensus on Monetary Policy: Blinder and Rudd: The Supply-Shock Explanation of the Great Stagflation Revisited.   Cost-push inflation is the decrease in the aggregate supply of goods and services stemming from an increase in the cost of production. Demand-pull inflation is the increase in aggregate demand. Difference in the approaches of Keynesian demand-side theory and alterna­tive supply-side theory can be understood with reference to Fig. which illustrates the emergence of stagflation as a consequence of a shift in the aggregate supply curve due to .   Demand and supply underlies all market price action. Market movements offer the best clues to identifying critical turning points for profitable trading. This website or its third-party tools use cookies which are necessary to its functioning and required to improve your experience.