The large aggregates in the economy such as consumption, investment, production of the domestic and the international sectors, international capital flows, financial accumulation and indebtedness, are analyzed in this book in terms of problems in time-optimization for enterprises and households. An examination of the effects of fiscal and monetary policies and exchange-rate variation leads to the conclusion that it is necessary that they should all be introduced simultaneously in order to stabilize demand. All household decisions on consumption, savings and financial dispositions are conditioned by uncertainty and this also afflicts companies, who make even more complex simultaneous decisions on production, real investment, financing and market strategy. The book argues that the marginal efficiency-of-investment function derived from these decisions is fundamentally different from the marginal productivity of capital in the neoclassical sense. An economy which grows through the accumulation of capital, increase in the labour supply and technological progress is the framework in which all of these variables operate.
This determines the allocation of factors between domestic and international production and the development of foreign trade. This book also examines growth of both public debt and international investment in depth. This monograph on macroeconomics and international economics is intended for researchers.
I The Growth Path.- A. Allocation under Full Employment.- A.1. Supply Forces.- A.2. Combination with Demand Forces.- A. 3. International Market Forces.- B. Allocation with Underemployment.- II On Aggregate Stability of Closed and Open Economies.- A The Closed Economy.- A.1. Reasons for Inflexible Prices.- A2. Effect of Money and Securities.- A.3. The Alternative of Rexible Prices.- A. 4. Neoclassical Views on Prices and Wages, Factor Substitution, and Some Evidence.- B. The Open Economy.- B.1. Real Disturbances.- B.2. Financial Disturbances.- B.2.a. Trade Impediments and the Adjustment of the Trade Balance.- B.2.b. Financial Shocks.- B. 3. Induced Capital Flow as a Corrective.- C. Concluding Remarks.- III Underutilized Resources.- A. The Case of Full Complementarity.- A.1. Analysis of Parameter Changes.- A.2. Consequence of an Exchange-Rate Variation.- A.2.1. External Terms of Trade Independent.- A.2.2. Terms of Trade Varying with Exchange-Rate.- A. 3. Trade Balance Change through Income Adjustments.- B. An Economy with Mixed Forms of Production.- C. Concluding Remarks.- IV Risk Averse, Time Optimizing Behavior of Households: Comparison With German Microcensus Data.- A. A Risk-Averse Time-Optimizing Model.- B. Comparison with Some Evidence.- C. Concluding Remarks.- V Investment Behavior In An Open Economy.- A. Price, Output, and Factor-Combination Decisions of the Firm.- B. Investment Decisions.- C. The Investment Function in Three Sectors.- D. Changing Investment under Full Employment.- E. Risk Aversion and Risk Avoidance.- VI The Labor Market And Wage Determination.- A. The Wage Rate Endogenous.- B. The Wage Rate as Exogenous Variable.- C Money Wages and the Rate of Inflation.- D. Real Wage Determination under Full Employment.- E. Summary.- VII The Market For Financial Assets And Monetary Policy.- A. Characterization of the Monetarist View.- VIII Growth Once More: Income And Claims To Wealth.- A. Claims to Wealth.- B. Growth of Public Debt and Debt Service.- C. External Claims.- D. The International Exchange of Assets.- Author Index.
Series: Lecture Notes in Engineering
Number Of Pages: 183
Publisher: Springer-Verlag Berlin and Heidelberg Gmbh & Co. Kg
Country of Publication: DE
Dimensions (cm): 24.41 x 16.99
Weight (kg): 0.33