econ488.umwblogs.orgSeminar in Advanced Macroeconomics | A Quasi-collaborative Adventure

Seminar in Advanced Macroeconomics A Quasi-collaborative Adventure Home Contact Info Course Outline Introduction Classical Economics Course Requirements Criteria for Grades Setting Up Your Course Blog Student Blogs Questions Notes for Week 1 ← Older posts Going Global Posted on April 28, 2017 by robmacroseminar One thing that we should consider as we revise each of our sections (I made this point earlier today but I think this is a better example) – how do the purposes of macro theory intersect, and what are the consequences of failure in one area? This article I think makes an interesting point in that direction (there’s a paywall but you can get past it using incognito mode on Chrome). It argues that the way economists teach comparative advantage and trade theory is misleading because it misses the distributional effects of trade agreements. We’re often taught comparative advantage using very simplistic assumptions – the Ricardian model of free trade assumes that workers and factors can easily switch between two different goods. In reality, the economy is more complex. Comparative advantage may mean that the economy as a whole is better off (the economic pie may get bigger) but the losers of trade may end up with a smaller slice of the pie than they had before trade. BUT because people had been taught that trade makes everyone better off, programs like trade adjustment assistance quietly failed the workers losing their jobs to trade. The point here isn’t that our models have failed to explain who wins and loses from trade. They seem to be doing a pretty good job of it; in the U.S., low skilled workers lose and higher skilled workers win from globalization. The problem is that the way we use these models to teach students about trade results in bad policy-making because those in charge simply conclude that because trade results in a bigger overall economic pie, the distributional effects are less important.” Some of the problem here might stem from conflation of welfare/efficiency and total utility. The economic pie may be at its biggest without redistribution (when it is at its most efficient) but redistribution may be better for total utility (which is admittedly hard to measure). Redistribution may cause the overall economic pie to shrink due to dead-weight loss, but more people are better off because the marginal utility of $1 to someone making $30k a year is greater than the marginal utility of $1 to someone making $100k over the same time. Posted in econ 488 , Student Blogs | Tagged ECON488 | Leave a comment At a Glance Posted on April 27, 2017 by dpagano Advances in technological firms have opened the opened a large sum of Americans to a vast amount of information. Since the 90s the labor force participation rate has been steadily decreasing. In 2013 According to BLS projections, 15.1 million men will have left the labor force by 2022, resulting in a labor force of 86.9 million men. Similarly, 11.8 million women are projected to have left the workforce by 2022.” This combined with atomization advancements in manufacturing and food processing due leads me to believe that the labor force participation rate is due to continue to decrease continually and at one point far ahead exponentially. Recently a peer asked me to evaluate a paper that captures the ways in which we gauge economic success. More importantly there are various comparisons of GDP to the social progress index, human development index, OECD better life index, World Happiness report index and finally the sustainable development goal index. There are other ways to evaluate social success whether it by happiness or social progress while the best-fit lines of GDP positively correlate with quality of life in the Euro-zone. Correlation ≠ causation and it is up for debate .Sustainable development might more achievable if one doesn’t promote a life of pure consumerism. This combined with the lower labor force participation rates leads me to believe that there will be many changes and advancements in sustainability, societal success and industry. I believe that macroeconomics as a whole is not broken and that DSGE failure is only another adjustment in focus in the lens that examines success. Toossi, Mitra . Labor force projections to 2022: the labor force participation rate continues to fall.” BLS.gov , December 2013. https://www.bls.gov/opub/mlr/2013/article/pdf/labor-force-projections-to-2022-the-labor-force-participation-rate-continues-to-fall.pdf. https://www.bls.gov/opub/mlr/2013/article/pdf/labor-force-projections-to-2022-the-labor-force-participation-rate-continues-to-fall.pdf Posted in Student Blogs | Tagged ECON488 | Leave a comment At a Glance Posted on April 27, 2017 by dpagano Advances in technological firms have opened the opened a large sum of Americans to a vast amount of information. Since the 90s the labor force participation rate has been steadily decreasing. In 2013 According to BLS projections, 15.1 million men will have left the labor force by 2022, resulting in a labor force of 86.9 million men. Similarly, 11.8 million women are projected to have left the workforce by 2022.” This combined with atomization advancements in manufacturing and food processing due leads me to believe that the labor force participation rate is due to continue to decrease continually and at one point far ahead exponentially. Recently a peer asked me to evaluate a paper that captures the ways in which we gauge economic success. More importantly there are various comparisons of GDP to the social progress index, human development index, OECD better life index, World Happiness report index and finally the sustainable development goal index. There are other ways to evaluate social success whether it by happiness or social progress while the best-fit lines of GDP positively correlate with quality of life in the Euro-zone. Correlation ≠ causation and it is up for debate .Sustainable development might more achievable if one doesn’t promote a life of pure consumerism. This combined with the lower labor force participation rates leads me to believe that there will be many changes and advancements in sustainability, societal success and industry. I believe that macroeconomics as a whole is not broken and that DSGE failure is only another adjustment in focus in the lens that examines success. Toossi, Mitra . Labor force projections to 2022: the labor force participation rate continues to fall.” BLS.gov , December 2013. https://www.bls.gov/opub/mlr/2013/article/pdf/labor-force-projections-to-2022-the-labor-force-participation-rate-continues-to-fall.pdf. https://www.bls.gov/opub/mlr/2013/article/pdf/labor-force-projections-to-2022-the-labor-force-participation-rate-continues-to-fall.pdf Posted in Student Blogs | Tagged ECON488 | Leave a comment DSGE Critiques PP Posted on April 21, 2017 by tzotos Hello class, Today Christian and I are presenting the critiques of DSGE models, mainly post 2008 global financial crisis! I have attached a link to view the presentation below if you would like to review it and develop questions beforehand. The predominent economists who provided discourse on the topic include Robert Solow, Anton Korinek, Noah Smith, Roger Farmer, Camilo Tovar, Paul Romer, and Paul Krugman. The critiques that stood out to us include: Failing the Market Test” Unrealistic Assumptions and Parameters Lack of Financial Sector Determination of Causality/Correlation Aggregated Microeconomics The both of will expand on these point more so in class. We encourage you all to ask questions and provide feedback. Several of the critiques will have overlapping ideas but we will provide context in class today on why we decided to put them into separate categories. https://docs.google.com/presentation/d/1HfNhkIU3iwYVvHqDcV6yJ_gKQjKyAlhmGgaKn9S4gvU/edit?invite=CK7o3fwL&ts=58f91f3d#slide=id.p Posted in Student Blogs | Tagged ECON488 | Leave a comment DSGE Critiques PP Posted on April 21,...