Mostly summarized from Gregory Mankiw’s Principles of Economics, 5th Ed.
PART 12 Short Run Macroeconomic Fluctuations
Chapter 33 of 36 Aggregate Demand and Aggregate Supply
Section 18 of 44
…
Figure 4 here
…
In the long run the quantity of output supplied depends on
· the economy's quantities of labor, capital, natural resources
· the technology level
Because the quantity of output does not depend on the overall price level the long-run aggregate supply curve is vertical at the natural rate of output
…
Classical macroeconomic theory predicts the quantity of goods and services produced by an economy in the long run.
So it also explains the position of the long-run aggregate supply curve.
The long-run level of production is sometimes called potential output or full employment output.
More precisely we call the long-run level of production the natural rate of output.
This is because it shows what the economy produces when unemployment is at its natural, or normal, level.
…
The natural rate of output is the level of production toward which the economy moves in the long run.
Any change in the economy that affects the natural rate of output shifts the long run aggregate supply curve.
Per Figure 4, because output in the classical model depends on four sources we can categorize shifts in the long-run aggregate supply curve as being caused by changes in
· labor
· capital
· natural resources
· technological knowledge
….
potential output
senzaiteki na shutsuryoku
潜在的な出力

Comments

Post a Comment

Popular posts from this blog

Image
  Picture 240805 Cooling off after exercise, weight at 165 pounds. Got to 160 pounds five years ago and have been bouncing between 157 and 168 since. Common sense ways to lose and keep off weight are eat right and light and get lots of exercise. Main exercise is walking, do 1~2 miles most days. Over career worked as a salesman in the steelmaking, fasteners, and auto manufacturing industries, lots of travel in U.S., Canada, Mexico, and Japan. Over the years have visited every U.S. city with a major league, MLB, NFL, NBA, NHL, sports team except Sacramento, have gotten as close as Travis Air Force Base. Often traveled on Sundays, much time on the road so could not eat right and get enough exercise so got heavy, up to 200 lbs. Was on commission and made enough to retire early, eat right and light, get enough exercise, and now spending most time reading and writing. Our Wick branch goes back to the brother of owner of Wick House in Morristown New Jersey and on back to Staines England. Have
Read more
  From article What 10 Years of U.S. Meddling in Ukraine Have Wrought (Spoiler alert: Not democracy). Aaron Mate. April 30, 2024. Section 2. Seeking to capitalize on the unrest in Ukraine in 2013, U.S. figures including State Department official Victoria Nuland, Republican Sen. John McCain, and Democratic Sen. Chris Murphy visited Maidan Square. In a show of support for the movement’s hardline faction, which went beyond supporting the EU trade deal to demand Yanukovych’s ouster, the trio met privately with Tyahnybok and appeared with him on stage. The senators’ mission, Murphy said, was to “bring about a peaceful transition in ukraine.” … The Maidan Movement’s most significant U.S. endorsement came from then-Vice President Joe Biden. “Nothing would have greater impact for securing our interests and the world’s interests in Europe than to see a democratic, prosperous, and independent Ukraine in the region,” Biden said. According to Andrii Telizhenko, a former Ukrainian gov
Read more

HAT Manifesto Part 1/3 - Rubric Cube - 240804 revision

Image
  “The world we see that seems so insane is the result of a belief system that is not working. To perceive the world differently, we must be willing to change our belief system, let the past slip away, expand our sense of now, and dissolve the fear in our minds.” - William James “All experience has shown mankind are more disposed to suffer,while evils are sufferable, than to right themselves by abolishing the forms to which they are accustomed.” - Thomas Jefferson “Wherever good fortune enters, envy lays siege and attacks it. And when it departs, sorrow and repentance remain behind.” - Leonardo da Vinci “Struggle is the indispensable accompaniment of progress. If men were entirely social, man would stagnate. A certain alloy of individualism and competition is required to make the human species survive and grow. Without qualities of an unsocial kind men might have led an Arcadian shepherd life in complete harmony, contentment, and mutual love. But in that case all their talents would
Read more