Macroeconomics

I N D E X

| 597

cyclical, 388

duration of, 176–177

in Europe, 180–184, 181f

frictional, 166–169

happiness and, 183–184

Okun’s law and, 260–263, 261f, 262f

productivity and, 178–179

rate of money growth and, 569

sectoral shifts in, 178

structural, 169–175, 170f

time inconsistency and, 463–465

tradeoff with inflation. See Phillips

curve

in United States, 163, 164f, 176–180,

177t, 180t, 182, 391–393, 392f

Unemployment insurance, 167–169

rate of job finding and, 168–169

Unemployment rate, 5, 36–40

definition of, 36–37

demographic variations in, 177t,

177–178

establishment survey and, 39–40

household survey and, 36–37, 37f

natural, 163–166, 165f. See also Non-

accelerating inflation rate of

unemployment (NAIRU)

recession of 2007 and, 257

in United States, 6, 7f, 163, 164f

Unexpected inflation, costs of, 103–104

Unions, wage rigidity and, 172–174,

173t

United Arab Emirates (UAE), Big Mac

price and exchange rate in, 148t

United Kingdom. See also England

Big Mac price and exchange rate in,

148t

collective bargaining in, 173t

devaluation by, 354

economic growth in, 238

government debt of, 468t

inflation in, 145f

inflation targeting in, 458

investment rate in, 202f

population growth and income per

person in, 215f

real GDP in, 237t

unemployment in, 180, 181f

wars and interest rates in, 70–72, 71f

United States. See also specific president’s

names

balanced growth in, 226

bank failures and money supply in

1930s and, 553–554, 554t

Big Mac price and exchange rate in,

148t

Bretton Woods system and, 349–350

budget deficits in, 4

central bank of. See Federal Reserve

(Fed)

collective bargaining in, 173t

currency of, 364

economic growth in, 238, 251, 251t

election of 1896 in, 104–105

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United States (continued)

financial crisis of 2008-2009 in, 69,

332–334, 393, 474–475, 538, 541

GDP of, 28–29, 29t

government debt of. See Government

debt

historical performance of economy

in, 4–6, 5f –7f

indexation in, 104

inflation and money growth in, 92f

inflation and nominal interest rate in,

96f

inflation in, 4, 79, 144–145, 145f,

391–393, 392f, 437–438

inflation rate in, 6, 6f

intellectual property rights and, 236

investment rate in, 202f, 203

labor force in, 178

labor-force participation rate in, 38f,

38–39

labor productivity and real wages in,

59–60, 60t

as large open economy, 149–150

legal tradition in, 234

NAFTA and, 359

OPEC-caused stagflation in, 282–283

population growth and income per

person in, 215f

ratio of labor income to total income

from 1960-2007 in, 58, 59f

real GDP of, 5, 5f, 191, 236, 237t,

258–259, 259f, 260f

recessions in, 4, 257, 297–298,

319–320, 393, 538

settlement of, 235

standard of living in, 171, 191, 192t

tax cuts in, 516

tax surcharge in, 516

trade deficits of, 131, 132f, 133–134,

488

unemployment in, 163, 164f,

176–180, 177t, 180t, 182,

391–393, 392f

unemployment insurance in, 168

unemployment rate in, 6, 7f, 163, 164f

work hours in, 184, 484f

U.S. Department of Commerce, 18, 23

U.S. Department of Labor, 32

U.S. Treasury

indexed bonds and, 489–490

recapitalization of banking system

and, 556

TARP and, 474–475

Unit of account, money as, 80–81

Uruguay, population growth and

income per person in, 215f

Used goods in GDP, 21

Utility, definition of 13

Value, money as store of, 80

Value added, 22

Variables

endogenous and exogenous, 8, 8f

functions to express relationships

among, 11

nominal, 112

predetermined, 418

random, 411

real, 112

Veldo, François R., 277

Velocity of money

income, 88

transactions, 86–87

Venezuela

direction of flow and, 134

inflation and money growth in, 92f

Vietnam

economic growth in, 229

standard of living in, 192t

Vietnam War, aggregate demand and,

392, 516

Vishny, Robert, 234n

Volcker, Paul, 304, 393, 398–399,

437–438, 486

Wage(s)

efficiency, 174–175

flexible versus sticky, 12–13

real, 53

recessions and, 400

Wage and price controls, of Nixon, 392

Wage rigidity, 169–175, 170f

efficiency wages and, 174–175

minimum-wage laws and, 170–172

unions and, 172–174, 173t

Wagner, Richard, 487

Wal-Mart, 243

Wants, double coincidence of, 81

War. See also specific wars

interest rates in United Kingdom

and, 70–72, 71f

Warner, Andrew, 228, 229n

Wascher, William,  171n

Washington, George, 456

Watson, Mark W., 395

The Wealth of Nations (Smith), 228

Weil, David N., 217n, 227n, 232n, 239n

Weinberg, Stephen, 520n

Welfare, 27

West Germany. See also Germany

real GDP in, 237t

Wicksell, Knut, 487

Wilcox, David W., 35n, 490n

The Wizard of Oz (Baum), 105

Woodbury, Stephen A., 169n

Woodford, Michael, 384n

Work in process, 543

World interest rate

capital mobility and, 125–126

definition of, 126

World War  II

depletion of ideas and, 238

interest rate and, 71

Yap Island, money on, 83

Yellen, Janet, 175n

Young, Alwyn, 252n

Zambia, investment rate in, 202f

Zeckhauser, Richard J., 231n

Zimbabwe

hyperinflation in, 111–112

inflation and nominal interest rate in,

96f