Macroeconomics

I N D E X

| 589

Friedman, Benjamin M., 488

Friedman, Milton, 14, 90, 326n, 328,

384n, 390, 445, 457, 499–500

permanent-income hypothesis and,

514–516

Froot, Kenneth A., 147n

Full-employment budget deficit, 476

Full-employment level of output, 273

Functions, 11

Gali, Jordi, 438

Galor, Oded, 217n

Gambia, population growth and

income per person in, 215f

Gayer, Ted,  478n

GDP. See Gross domestic product

(GDP)

GDP deflator, 25

CPI versus, 33–34, 34f

Geithner, Timothy,  366

General equilibrium models, 74

The General Theory of Employment,

Interest and Money (Keynes),

287–288, 289, 452, 460–461, 496

Germany

collective bargaining in, 173t

economic growth in, 200, 201

exchange rate of, 354

government debt of, 468t

hyperinflation in, 79, 106, 109, 110f,

111

inflation and nominal interest rate in,

96f

real GDP in, 237t

standard of living in, 192t

unemployment in, 180, 181f

work hours in, 184, 484f

Gertler, Mark, 438

Ghana, investment rate in, 202f

Glaeser, Edward, 185, 186n

GNP. See Gross national product

(GNP)

Golden Rule level of capital, 203–211

comparing steady states and,

204–207, 205f, 206f

finding steady state and, 207–208, 208t

transition to steady state and,

208–211, 209f, 210f

Goldfeld, Stephen M., 563n

Gold standard, 81

international, 351–352

Goods and services

capacity to produce, standard of liv-

ing and, 568

CPI and, 32–34

demand for, 60–73, 410–411

intermediate goods, 22

international flows of. See Inter-

national flows of capital and goods

in national income accounts, 21–23

new, CPI and, 35

normal goods, 505–506

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Goods and services (continued)

production of, aggregate demand

and, 568

supply of, 48–49, 65–73

used goods, 21

valuing government services, 23

Goods market, IS* curve and, 341–343,

342f

Gordon, David, 463n

Gordon, Robert J., 35, 243n, 396n

Gourinchas, Pierre-Olivier, 510n

Government bonds, in United

Kingdom, 70

Government debt, 467–490. See also

Budget deficits

balanced budgets versus optimal fiscal

policy and, 485–486

fiscal effects on monetary policy and,

486–487

indexed bonds and, 489–490

international perspective on, 468t,

468–469, 488

long-term outlook for fiscal policy

and, 470–472

measuring, problems in, 472–476

political process and, 487–488

Ricardian view of, 479–485

size of, 468t, 468–472, 469f

traditional view of, 476–479

Government purchases, 27, 64–65

crowding out by, 69

increase in, saving and, 68–70, 70f

IS curve shifts and short-run equilib-

rium and, 312f, 312–313

Keynesian cross and, 292–294, 293f,

297–298

Government-purchases multiplier,

292–294, 293f

Government services, valuing, 23

Great Depression, 6, 257, 326t–327t,

326–332

bank failures and, 538

depletion of ideas and, 238

money hypothesis of, 328–331

policy debate about, 452

possibility of recurrence, 331–332

recovery from, 354

spending hypothesis of, 327–328

Greece

government debt of, 468t

investment rate in, 202f

Greenspan, Alan, 438, 458, 486, 563

Griliches, Zvi, 35, 242n

Gross domestic product (GDP), 18–32,

45–75, 46f

chain-weighted measures of, 25–27

circular flow and, 18–20, 19f, 45–46,

46f

components of, 61. See also

Consumption; Government pur-

chases; Investment; Net exports

components of expenditure and,

27–29, 29t

computation of, 20–23

definition of, 18

determinants of, 47–49. See also

Factors of production;

Production function

GDP deflator and, 25

income and expenditure and, 18–20,

19f

inventories and, 21–22

nominal, 23–24

other measures of income compared

with, 29–31

real. See Real GDP

seasonal fluctuations in, 31–32

sources and uses of, 45–46, 46f

of United States, 28–29, 29t

views of, 18

Gross national product (GNP), 29–30

Growth accounting, 247–254

growth in East Asian tigers and,

251–252

increases in factors of production

and, 247–249

Solow residual in short run and,

252–254, 253f

sources of growth in United States

and, 251, 251t

technological progress and, 249–250

Growth effect, 201

Guatemala, population growth and

income per person in, 215f

Guinea-Bissau

investment rate in, 202f

population growth and income per

person in, 215f

Haiti, inflation and money growth in,

92f

Hall, Robert E., 164n, 227n, 519, 533n

random-walk hypothesis and,

516–518

Hamilton, Alexander, 94, 456, 467

Hamilton, James D., 283n

Hansen, Gary D., 217n

Happiness, unemployment and,

183–184

Hayashi, Fumio, 534n

Heertje, Arnold, 14n

Hicks, John R., 289n

High-powered money, 551

Hirsch, Barry T., 14n

Hong Kong

Big Mac price and exchange rate in,

148t

economic growth in, 251–252

exchange rate of, 364

population growth and income per

person in, 215f

House, Christopher L., 533

Housing market. See also Residential

investment

decline in prices in United States, 69

economic downturn of 2008-2009

and, 332–333

imputations and, 23

Howitt, Peter, 243

Hubbard, R. Glenn, 538n

Human capital, 232

Hume, David, 86, 278

Hungary

Big Mac price and exchange rate in,

148t

government debt of, 468t

Hurd, Michael, 513n

Hyperinflation, 79, 106–112

in Bolivia, 107–108

causes of, 108–109

costs of, 106–107

in Germany, 79, 106, 109, 110f, 111

in Zimbabwe, 111–112

Hysteresis, 400

Iceland

government debt of, 468t

inflation in, 145f

Ideas, depletion of, 238

Identities, 27, 87

IMF. See International Monetary Fund

(IMF)

Imperfect-information model, 383–384

Implicit price deflator for GDP, 25

Impossible trinity, 364–365, 365f

Impulse response functions, 425

Imputed value, 22–23

Incentives, taxes and, 478

Income

circular flow and, 18–20, 19f

consumption and, 505f, 505–506

disposable, 61

GDP as measure of. See Gross

domestic product (GDP); Real

GDP

GNP as measure of, 29–30

LM curve and, 304–305, 305f

national. See National income entries

NNP as measure of, 30

permanent, 514–516

per person, in United States, 215f

personal, disposable, 31

predictable changes in, consumption

and, 518

ratio of labor income to total income

from 1960-2007 in United States

and, 58, 59f

total, GDP as, 18

transactions and, 87–88

transitory, 514

Income effect, 506

Income velocity of money, 88

Independence of central banks, 459, 460f

Indexation, 104

Indexed bonds, 489–490

Index of leading economic indicators,

263