Don't forget to bring a laptop, one to each group at least.  Also, we'll be having a quiz, so re read your lecture notes!

Given your characterisation, what does it mean for the study of the economy?•Wages •Consumption•Rent •Government Expenditure•Manufacturing Output •Interest payments•Loans•Bank deposits•Bonds•Equities•Money Balances Problem 2Balance sheet matrices help us understand stocks, assets and liabilities as well as the structure of the economy....  Fill in the missing values.Assets20012005Liabilities20012005Total?22,725Total17,500?Tangible Capital9,20011,750Loans9,10010,125Financial Assets8,300?Equities Issued?10,925 Net Worth-2,500+1675 3.

The reader is left wondering just who this person really is, how they came up with the ideas they are being lauded for, what they think of their ideas now, where they see the discipline going in the next little while, and so on. Who’s Who manages, ironically, to strip out the personal in its biographical summary, in essence, losing the ‘Who’.

..." In future editions of this book and the further volumes to come, I'd love to see a focus on the characters behind different approaches to economics and their reasons for taking their contrarian positions to the mainstream---Foley, Nell, Solow and Velupillai, as well as more traditional mainstays of the profession.

Trading behaviour makes markets unstable because of the ever-present cost pressures from competing economic entities, which, although richer traders are partially insulated from these cost problems in the short run, will affect all members of the sector eventually....  A good example might be the naturally gifted child from who can go to a private school because of their parents' wealth and who is accepted for a scholarship to a prestigious university, who sells their labour for a higher amount than others in the labour market and so 'wins' in our schema.

The fact that about eighty-five per cent of the dogs have recently been eaten by other dogs perhaps explains what long ago we noticed about business: that it had a strong smell of boloney.  If dog continues to eat dog, there will only be one dog left, and he will be sick to his stomach.

Right click to download the lecture notes EC6012_Lecture2_Review.pdf

We've already talked about measuring total output, so revise your notes on GDP, GNI, etc. Aggregate Supply: The total supply of goods and services produced in the economy in a given period AS = (net output per hour)*(total hours of employment) = yN Aggregate Demand AD is the total demand for goods and services in an economy in a given period.  AD = C+I C = cwN AD= C+I- cwN+I Total Saving = wages saved + all profit income = Nc(1-c)+N(y-w) = Nw-Nwc+Ny-Nw =Ny-Nwc Market Clearing AS = yN=cwN+I = AD Unemployment and Government Fiscal Policy AD = C+ I + B = cwN + I + B AS = yN = cwN + I + B = AD yN- cwN = I + B N(y-cw) = I+B so N* = (I+B)/(y-cw) this is the equation for the equilibrium level of employment when AS=AD in the product market.

The data methodology is in there, but basically: The output gap figures are used to calculate the Cyclically Adjusted Budgetary Balance (CABB), which is used to assess the ‘close to balance’ budgetary requirement....  2004 2005 2006 2007 2008 Real GDP Growth 4.5 4.6 4.8 5.0 4.8 Potential GDP Growth 5.8 6.1 5.5 5.3 4.8 Output GAP 0.1 -1.3 -2.0 -2.3 -2.3 And here you can download the spreadsheet I used to make the graphs.

Keynes, John Maynard The General Theory of Employment, Interest and Money, Chapters 6 & 7 (link to full text) (Write a 1 page summary of each of these chapters as an exercise, post the essays on your blogs by Tuesday March 5, 12:00 pm.)

Second, Expenditure on Gross National Income at Current market Prices.If you missed the lecture, hopefully your mates kept you a handout.  If not, email me and make something up and I'll email it to you.Now first, we'll graph the changes in consumption, investment, etc that are shown in these accounts.

Start here with 10 web applications to help you study.

I've been arseing around for an hour now on this website. I think I'll stick with this theme. Any thoughts? […]

The output gap for Ireland from 1970--2005 is shown below The figure below shows Ireland's percentage deviation from it's potential GDP from 1970 to 2005 compared with the USA (data for this figure came from http://www.imf.org/external/pubs/ft/weo/2000/02/data/ngap.csv).

...Highly correlated with high levels of income (obviously two-directional causality here); together with differences in saving rates can "explain" a fraction of the cross-country differences in output; this is an important predictor of high growth performance.

I've ordered 5 copies of our textbook, Godley (2006), for the library, and 10 for the bookshop.  If you'd like to subvert that whole middleman/sharing thing, then go here.

Here are the International Monetary Economics Blogs set up for EC6012.