All posts tagged aggregate demand

Random thoughts on economics

I think most people understand the supply and demand less than we think. That’s because supply and demand are more confusing and complex than what is taught in mainstream EC101 lectures today. Maybe you don’t think so, but I do. Suppose we asked students who have already taken EC101&102: “Oil prices fell. For this reason, […]

Aggregate Demand is not what you think

Scott Sumner has a new piece arguing that supply and aggregate supply are unrelated and misnamed: The AS/AD model that we teach our students is misnamed, as it has nothing to do with the supply and demand model used in microeconomics. To take one simple example, the vast majority of industry supply curves are almost […]