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1500 questions
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Is it possible to eliminate the U.S. national debt?
A political science teacher of mine has said that the U.S. national debt has grown way beyond reach and is now just a political talking point with no real value. He says that there is no point in trying to pay it back and that it should be left…
Howsikan
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Do perfect complements have to be normal goods? If so, why?
Two goods $x,y$ are perfect complements if they have the utility function
$$U(x,y) = \min \lbrace ax,by \rbrace $$
$$a,b \in \Bbb{Q}^+$$
My professor said $x,y$ have to be normal goods but didn't explain why well enough that I could understand.…
Stan Shunpike
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8
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Compute evolution of a distribution over time
We have a population of people with different age $a$, time is indexed with $t$. There is a rate at which people die, $d(a, t)$. For simplicity, ignore births. I want to compute the evolution of the distribution of ages over time.
Denote the mass of…
FooBar
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8
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Is evolutionary game theory a useful modelling tool?
Has evolutionary game theory ever been used to successfully describe an ecosystem or a reasonably closed subsystem of the economy? A frequently used example is about side-blotched lizards but I don't know of any others. And has it ever been proven…
Giskard
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8
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3 answers
What determines the exchange rate of two fiat currencies if the supply of each is known?
In this blog post, economist Steve Landsburg posed a question about the value of Bitcoin which he didn't know the answer to.
Imagine a future in which Bitcoins (or some other non-governmental
currency) are widely accepted and easily substitutable…
Keshav Srinivasan
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8
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2 answers
What is the advantage and disadvantage to have a high value of USD for USA?
What is the advantage and disadvantage to have a high value of USD for USA?
China and Japan always want to keep their currency low as oppose to USA.
Victor
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8
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Why some countries are wealthier than others?
Twin-peak of economic growth is one of the concepts discussed in economics. Most of explanations for poverty traps are baseed on the lack of infrastructures and public goods.
How could be another main reasons to explain this important issue ?
Any…
optimal control
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8
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Why does Slutsky compensation "overcompensate" the consumer?
Suppose I have a Marshallian demand function $x_M(p_x^0,p_y,m^0)$. As I understand it, Slutsky compensation is defined as
$$T_S = \Delta p_x \cdot x_M(p_x^0,p_y,m^0)$$
Can someone explain why this compensation overcompensates the consumer?
Stan Shunpike
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8
votes
2 answers
What is the necessity of the FDIC in the US banking system?
A bank's basic function is to "borrow short and lend long". In other words, it borrows money from depositors over the short term, promising to repay it on demand, while it lends most of that money out over the long term to borrowers, for instance in…
Keshav Srinivasan
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8
votes
4 answers
How can we explain quantity competition and price taking?
Note: This is a question on the didactics of microeconomics, directed to those of you who have some experience teaching this subject.
When I studied the basic principles of microeconomics, a price-setting monopoly made perfect sense to me, but…
VARulle
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8
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4 answers
Can someone explain why sterling-dollar parity is bad?
Please forgive the probable naivety of this question. I am not an economics student I am just trying to understand the currency fluctuations that are currently occurring with GBP as a result of our new chancellor's likely incompetence.
In nearly all…
thomasbishop
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Translog Preferences
What are translog preferences? The wikipedia article only clears up that it stands for transcendental logarithmic preferences, and that they are a generalization of Cobb-Douglas preferences.
Do they have special features that make it more appealing?…
FooBar
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8
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What are the causes for the recent dramatic decline in productivity in the US
The recent Q2 release by the BLS on "Productivity and Costs", shows a big drop in productivity (the biggest ever since 1948): more work-hours but less output.
Nonfarm business sector labor productivity decreased 4.6 percent in the second quarter of…
d_e
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8
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Splittet Value Function and Hamilton-Jacobi-Bellman equation
General Problem
Let $k\in\mathbb{R}_+$ be the state variable, $k=k^*$ a fixed point (saddle) and $v(k)$ a value function. The problem is, that the value function has two distinct functional forms, where the switch is at the fixed point.
Do you…
clueless
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Departure point for research in economics
I hope this is the place to ask this question. I am in the first year of PhD in economics. As most of PhD students in economics, I try to show some economic mechanisms by theoretical modelling in environmental economics.
Most of time, I have a…
optimal control
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