ch1introduction(中级宏观经济学,香港中文大学).pptVIP

Chapter 1 Introduction What is Macroeconomics ? Macroeconomics focuses on the aggregate behavior of consumers and firms the behavior of government the overall level of economic activity in individual countries the economic interactions among nations the effects of fiscal and monetary policies Macroeconomics differs from microeconomics in that it deals with the overall effects on economics of the choices that all economic agents make, rather than on the choices of individual consumers or firms. Long-run growth refers to the increase in a nation’s productive capacity and average standard of living over a long period of time. Business cycles refer to the short-run ups and downs in aggregate economic activity. Gross National Product, Economic Growth and Business Cycles The most basic set of facts in macroeconomics has to do with the behavior of aggregate economic activity over time. One measure of aggregate economic activity is gross national product (GNP). The series of real GNP per capita for the U.S. over the period 1900-2002 is shown in the figure. Two Useful Transformation of Data 1) Taking natural logarithm of time series. The slope of the graph of the natural logarithm of a time series yt is a good approximation to the growth rate of yt when the growth rate is small. Since if yt ? yt-1, we have 2) Detrending the process of decomposing the series into 2 components: the growth (or trend) component, and the business cycle component. The trend in the log of real per capita GNP is shown as a colored line, while the log of actual real per capita GNP is the black one. The lower graph shows only the percentage deviations from trend in real per capita GNP. Macroeconomic Models Purpose: To capture the essential features of the world needed for analyzing a particular economic problem. To be useful then, a model must be simple. Basic structure of a macroeconomic model: The consumers and firms in the economy, who are assumed to optimize The sets of goods tha