aggregate demand and supply scarth chapter 2 makroekonomi 2, s1, feui, 2009 – arianto a. patunru
TRANSCRIPT
![Page 1: Aggregate Demand and Supply Scarth Chapter 2 Makroekonomi 2, S1, FEUI, 2009 – Arianto A. Patunru](https://reader035.vdocuments.net/reader035/viewer/2022062217/56649e665503460f94b60eb4/html5/thumbnails/1.jpg)
Aggregate Demand and Supply
Scarth Chapter 2
Makroekonomi 2, S1, FEUI, 2009 – Arianto A. Patunru
![Page 2: Aggregate Demand and Supply Scarth Chapter 2 Makroekonomi 2, S1, FEUI, 2009 – Arianto A. Patunru](https://reader035.vdocuments.net/reader035/viewer/2022062217/56649e665503460f94b60eb4/html5/thumbnails/2.jpg)
Structural equations
• IS relationshipY = C + I + G (1)
C = C(Y) 0 < CY < 1 (2)
I = I(Y,r) IY > 0, Ir < 0 (3)
• LM relationshipM/P = L(Y,i) LY > 0, Li < 0 (4)
• EA Phillips curveP˜/P = H(Y - Ŷ)/Ŷ] + π H’ > 0 (5)
![Page 3: Aggregate Demand and Supply Scarth Chapter 2 Makroekonomi 2, S1, FEUI, 2009 – Arianto A. Patunru](https://reader035.vdocuments.net/reader035/viewer/2022062217/56649e665503460f94b60eb4/html5/thumbnails/3.jpg)
LR adjustment
![Page 4: Aggregate Demand and Supply Scarth Chapter 2 Makroekonomi 2, S1, FEUI, 2009 – Arianto A. Patunru](https://reader035.vdocuments.net/reader035/viewer/2022062217/56649e665503460f94b60eb4/html5/thumbnails/4.jpg)
Marginal analysis
![Page 5: Aggregate Demand and Supply Scarth Chapter 2 Makroekonomi 2, S1, FEUI, 2009 – Arianto A. Patunru](https://reader035.vdocuments.net/reader035/viewer/2022062217/56649e665503460f94b60eb4/html5/thumbnails/5.jpg)
Rewriting the system
• dY = CYdY + IYdY + Irdr + dG (6)
• LYdY + Lidr = (1/P)dM - (M/P2)dP(7)
• (1/P˜)dP – (P ˜/P2)dP = (H’/Ŷ)dY(8)
![Page 6: Aggregate Demand and Supply Scarth Chapter 2 Makroekonomi 2, S1, FEUI, 2009 – Arianto A. Patunru](https://reader035.vdocuments.net/reader035/viewer/2022062217/56649e665503460f94b60eb4/html5/thumbnails/6.jpg)
Short-run analysis
dP
dM
dG
PMPdr
dY
LL
IIC
iY
rYY
2
0
10
011 (9)
YrYYi
i
LIICL
L
dG
dY
)1((10)
![Page 7: Aggregate Demand and Supply Scarth Chapter 2 Makroekonomi 2, S1, FEUI, 2009 – Arianto A. Patunru](https://reader035.vdocuments.net/reader035/viewer/2022062217/56649e665503460f94b60eb4/html5/thumbnails/7.jpg)
Stability analysis
YrYYi
r
YrYYi
r
LIICLYP
MHI
dP
Pd
LIICL
PMI
dP
dY
)1(
1'
)1(
2
(11)
(12)
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Stability requirement
![Page 9: Aggregate Demand and Supply Scarth Chapter 2 Makroekonomi 2, S1, FEUI, 2009 – Arianto A. Patunru](https://reader035.vdocuments.net/reader035/viewer/2022062217/56649e665503460f94b60eb4/html5/thumbnails/9.jpg)
Convergence: AD and AS
![Page 10: Aggregate Demand and Supply Scarth Chapter 2 Makroekonomi 2, S1, FEUI, 2009 – Arianto A. Patunru](https://reader035.vdocuments.net/reader035/viewer/2022062217/56649e665503460f94b60eb4/html5/thumbnails/10.jpg)
Convergence: IS and LM
![Page 11: Aggregate Demand and Supply Scarth Chapter 2 Makroekonomi 2, S1, FEUI, 2009 – Arianto A. Patunru](https://reader035.vdocuments.net/reader035/viewer/2022062217/56649e665503460f94b60eb4/html5/thumbnails/11.jpg)
Full equilibrium
dM
dG
Pdr
dP
LPM
I
i
r
10
0102 (13)
![Page 12: Aggregate Demand and Supply Scarth Chapter 2 Makroekonomi 2, S1, FEUI, 2009 – Arianto A. Patunru](https://reader035.vdocuments.net/reader035/viewer/2022062217/56649e665503460f94b60eb4/html5/thumbnails/12.jpg)
Alt govt policies
dr
dP
dG
LPM
I
dM
dY
PL
IC
i
r
Y
YY2
0
0
1
1
01(14)
![Page 13: Aggregate Demand and Supply Scarth Chapter 2 Makroekonomi 2, S1, FEUI, 2009 – Arianto A. Patunru](https://reader035.vdocuments.net/reader035/viewer/2022062217/56649e665503460f94b60eb4/html5/thumbnails/13.jpg)
Pegging i and Ms