Macroeconomics

I N D E X

| 595

Retirement savings, encouraging,

520–521

Returns to scale, constant, 48

Revaluation, 354

Revenue Act of 1932, 328

Ricardian equivalence, 467–468,

479–485

basic logic of, 479–480

consumers and future taxes and,

480–483

Ricardo on, 484

Ricardo, David, 480, 484

Risk aversion, 104

Robinson, James A., 235

Rockoff, Hugh, 105n

Rodriguez-Clare, Andres, 227n

Rogoff, Kenneth, 147n, 339n

Romania, inflation and nominal interest

rate in, 96f

Romer, Christina D., 452–453

Romer, David, 227n, 229, 232n, 385n

Romer, Paul M., 233n, 239n

Rosen, Harvey, 478n

Rotemberg, Julio, 383n

Rudd, Jeremy E., 268n

Rule for conducting economic policy,

453–459

Russia

Big Mac price and exchange rate in,

148t

default of, 488

direction of flow and, 134

standard of living in, 192t

Rwanda, investment rate in, 202f

Sacerdote, Bruce, 185, 186n

Sachs, Jeffrey D., 228, 229n, 354n

Sacrifice ratio, 396, 398–399, 399t

Sala-i-Martin, Xavier, 227n

Samuelson, Paul A., 14, 534

Sargent, Thomas J., 109n, 397

Saudi Arabia, Big Mac price and

exchange rate in, 148t

Saving, 67, 68f

changes in, 68–70

economic growth and, 200–201, 201f

of elderly, 512–513

encouraging, 520–521

international variation in, 202f,

202–203

national, 67, 68f

precautionary, 513

private, 67

public, 46, 67

Saving rate

changing, 231–232

economic growth and, 230–231

Scale, constant returns to, 48

Schleifer, Andrei, 234n

Schumer, Charles, 366

Schumpeter, Joseph, 242–243

Schwartz, Anna J., 90, 326n, 328

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Seasonal adjustment, 31–32

Sectoral shifts, 167

Secular stagnation, 498

Securitization, 332

Seigniorage, 92–94

Services. See Goods and services

Shapiro, Matthew D., 35n, 449n, 482n,

533

Shiller, Robert J., 101, 490n, 537n

Shimer, Robert, 179n

Shleifer, Andrei, 483n

Shocks, 278

demand, 278, 279f, 279–280

in IS–LM model, 318–320

supply. See Supply shocks

Shoeleather cost of inflation, 102

Short run, long run versus, 265–266

Short-run aggregate supply curve

(SRAS), 272, 273–275, 274f

Short-run equilibrium

AD-AS model and, 422f, 422–423

fiscal policy and, 312f, 312–313,

314f

IS–LM model and, 306–308, 307f,

324f, 324–325

monetary policy and, 313–315, 314f

Short-run Phillips curve, 393–395,

394f

Sichel, Daniel E., 563n

Singapore

Big Mac price and exchange rate in,

148t

economic growth in, 251–252

inflation and money growth in, 91, 92f

inflation in, 145f

legal tradition in, 234

Slemrod, Joel, 482n

Slovak Republic, government debt of,

468t

Small open economies, 125–135

capital mobility and world interest

rate and, 125–126

definition of, 126

under fixed exchange rates, 349–355

under floating exchange rates,

345–348

model of, 127–128, 128f

Mundell-Fleming model and. See

Mundell-Fleming model

policy effects on trade balance and,

128–131

reasons to assume, 126–127

Smith, Adam, 228, 229, 234

Social costs of inflation, 100–105

Social Security, 27, 471, 474

Solow, Robert M., 14, 124, 192n, 250,

252, 391

Solow growth model, 191–218. See also

Capital accumulation; Golden

Rule level of capital; Population

growth

balanced growth and, 225–226

convergence and, 226–227

factor accumulation versus produc-

tion efficiency and, 227–228

technological progress in, 222–225

Solow residual, 250

in short run, 252–254, 253f

Souleles, Nicholas S., 518n

South Africa

Big Mac price and exchange rate in,

148t

inflation in, 145f

investment rate in, 202f

South America. See Latin America; spe-

cific countries

South Korea

Big Mac price and exchange rate in,

148t

economic growth in, 229, 251–252

financial crisis of 1997-1998 and,

360–361

government debt of, 468t

inflation in, 145f

investment rate in, 202f

population growth and income per

person in, 215f

trade deficits of, 131

Spain

collective bargaining in, 173t

government debt of, 468t

inflation targeting in, 458

investment rate in, 202f

legal tradition in, 234

unemployment in, 182

Speculative attacks, 364

Spending hypothesis, 327–328

Spiegelman, Robert G., 169n

Sprenkle, Case M., 558n

SRAS. See Short-run aggregate supply

curve (SRAS)

Stabilization, budget deficits and, 486

Stabilization policy, 278–283, 445–461,

571–572

active versus passive, 446–453

effectiveness of, 452–453

OPEC-caused stagflation and,

282–283

rule versus discretion for conducting,

453–459

shocks to aggregate demand and,

279f, 279–280

shocks to aggregate supply and,

280–281, 281f

Stagflation, 280, 427

Staiger, Douglas, 395

Standard of living. See also Gross

domestic product (GDP)

determination of, 568

in United States, 171, 191, 192t

Statistical discrepancy, 30

Steady state

Golden Rule level of capital and. See

Golden Rule level of capital

growth in capital stock and,

195f –197f, 195–197

Steady-state level of capital, 195f –197f,

195–199, 199t

technological progress and, 223–224,

224f

Steady state level of capital, population

growth and, 211–213, 212f

Sticky price(s), 12–13, 266t, 266–268,

267t

Sticky-price model, 381–383

Sticky wages, 12–13

Stimulus package, under Obama,

297–298, 333, 486

Stock(s), 20, 69, 533

Stock, James H., 395

Stock market

decline in, recession of 2001 and,

319–320

as economic indicator, 534–536,

535f

efficient markets hypothesis and,

536–537

financial crisis of 2008-2009 and, 333

Tobin’s q and, 533–536, 535f

Stock-out avoidance, 543

Store of value, money as, 80

Structural unemployment, 169–175,

170f

efficiency wages and, 174–175

minimum-wage laws and, 170–172

unions and collective bargaining and,

172–174, 173t

Subprime borrowers, 332, 541

Substitution, marginal rate of, 503

Substitution bias, CPI and, 35

Substitution effect, 506–507

Summers, Lawrence H., 175n, 231n,

254n, 400n, 459n, 483n, 534n

Supply

aggregate. See Aggregate supply (AS)

at equilibrium. See Equilibrium

of goods and services, 48–49

production function and, 193, 194f

Supply-and-demand diagram, 9f, 9–10,

10f

Supply shocks, 278, 280–281, 281f

AD-AS model and, 424f, 424–427,

426f

oil prices and, 392–393

Phillips curve and, 390

precision of estimates of NAIRU

and, 395

Supply-siders, 296, 478

Surpluses. See Budget surpluses; Trade

surpluses

Sweden

Big Mac price and exchange rate in,

148t

collective bargaining in, 173t

devaluation by, 354

government debt of, 468t

inflation in, 145f

inflation targeting in, 458

Switzerland