中级宏观经济管理学与财务知识分析规范.ppt

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1、Chapter5AClosed-EconomyOne-PeriodMacroModelTheModelTheeconomythatweconsiderisaclosedeconomy,i.e.onethatdoesnottradewithothereconomies.Besidesrepresentativeconsumerandrepresentativefirm,thereisanadditionalagent:thegovernment.GovernmentTheonlyactionofthegovernmentistoimplementfiscalp

2、olicy.Fiscalpolicyreferstothegovernment’schoicesoveritsexpenditures,taxes,transfersandborrowing.TheGovernmentSupposethegovernmentwishestopurchaseagivenquantityofconsumptiongood,G.Sincethereisonlyoneperiod,thegovernmentcannotborrowtofinanceG.ThusGispaidbytaxingtherepresentativeconsum

3、er.Thegovernmentmustobservethebalancedbudgetconstraint,G=T.CompetitiveEquilibriumCompetitivereferstothefactthatallconsumersandfirmsareprice-takers.Equilibriumreferstothestatewhentheactionsofallconsumersandfirmsareconsistent.FormalDefinition:Acompetitiveequilibriumisasetofendogenous

4、quantitiesC,Ns,Nd,TandY,andanendogenousrealwagew,suchthat,giventheexogenousvariablesG,z,andK,thefollowingaresatisfied:1)CandNssolvestheconsumer’sproblem,maxU(C,h-Ns)C,NssubjecttoC=wNs+-TandC0,Ns0.Inotherwords,CandNsmustsatisfytheFOC,U2(C,h-Ns)-wU1(C,h-Ns)=0.2)Ndsolvesthefirm’spro

5、blemgivenz,Kandw.ThustheFOCissatisfied.3)Market-clearingconditions:LabormarketclearingNs=Nd=N4)BalancedBudgetconstraint:G=T.Wehave:GoodsmarketclearingY=C+GCombiningthetwoFOCs,wehaveU2(C,l)-zF2(K,h-l)U1(C,l)=0.Since=zF(K,h-l)-wNdandG=T,fromthebudgetconstraintC=zF(K,h-l)-G.Fromthes

6、e,wecansolvefortheequilibriumCandl.GraphicalIllustrationsStep1:Derivetheproductionpossibilitiesfrontier(PPF),whichdescribesthetechnologicalpossibilitiesfortheentireeconomy,intermsoftheproductionofCandl.Step2:PutthePPFtogetherwiththeconsumer’sindifferencecurves,sothatwecananalyzeacom

7、petitiveequilibriuminasinglediagram.ProductionPossibilitiesFrontierInequilibrium,wehaveNd=Ns=N=h-l.OutputisgivenbyY=zF(K,h-l).whichisarelationshipbetweenoutputandleisure.Y*isthelevelwhenl=0.ProductionPossibilitiesFrontierInequilibrium,C=Y-G=zF(K,h-l)-GarelationshipbetweenCandl,given

8、theexogenousvariabl