• Summary
  • Contents
  • Subject index

Interest in economics is at an all-time high. Among the challenges facing the nation is an economy with rapidly rising unemployment, failures of major businesses and industries, and continued dependence on oil with its wildly fluctuating price. Economists have dealt with such questions for generations, but they have taken on new meaning and significance.Tackling these questions and encompassing analysis of traditional economic theory and topics as well as those that economists have only more recently addressed, 21st Century Economics: A Reference Handbook is a must-have reference resource.Key FeaturesProvides highly readable summaries of theory and models in key areas of micro and macroeconomics, helpful for students trying to get a "big picture" sense of the fieldIncludes introductions to relevant theory as well as empirical evidence, useful ...

Economic Instability and Macroeconomic Policy
Economic instability and macroeconomic policy

Macroeconomic instability and the business cycle are generally understood as changes in output or gross domestic product (GDP), unemployment, and inflation rates. The economy has a long-run growth path that is subject to short-term macro-economic demand and supply shocks that push GDP away from its long-run potential or trend growth rate. Smith and the classical tradition that followed believed a hands-off approach was the correct policy stabilization to pursue when such short-term output disturbances arose. This reflected classical emphasis on long-run growth as a supply process that was best left to private entrepreneurial activity. Furthermore, private market economies would automatically self-correct through appropriate wage and price adjustments. Recessions, characterized by “gluts” of commodities and workers, would ...

  • Loading...
locked icon

Sign in to access this content

Get a 30 day FREE TRIAL

  • Watch videos from a variety of sources bringing classroom topics to life
  • Read modern, diverse business cases
  • Explore hundreds of books and reference titles