The reason we worry about recessions is mostly involuntary unemployment. Because recessions cause employment fluctuations, and this affects the entire economy. But, why do recessions cause employment fluctuations? Indeed, this question is one of the most important questions at the heart of macroeconomics, and it shows us why nominal variables and wage stickiness is so […]
All posts tagged macroeconomics
Sticky Wages: The Key Problem of Macro
Posted by kgorgen on October 12, 2021
https://www.themoneymischief.com/sticky-wages-the-key-problem-of-macro/
IS-LM is not a useful model
I have to admit that I have rarely used the IS-LM model since I became interested in economics. Instead, I find the AD-AS model much more useful. Of course, this does not mean that there is a major theoretical flaw in the IS-LM model. Rather, I think that the inferences that economists make by looking […]
Posted by kgorgen on September 18, 2021
https://www.themoneymischief.com/is-lm-is-not-a-useful-model/
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, […]
Posted by kgorgen on June 13, 2021
https://www.themoneymischief.com/random-thoughts-on-economics/
Economics failing us. What about the EconTwitter?
There has been a buzz on EconTwitter and academia lately. I think the first thing I saw on this was Tyler Cowen’s post, where he compared blogs and Twitter. Although I preferred to use Twitter until last year, then I opened this blog for my own reasons. Even though it is a topic that I […]
Posted by kgorgen on May 29, 2021
https://www.themoneymischief.com/economics-failing-us-what-about-econtwitter/
