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1500 questions
7
votes
4 answers
Why does the inflation not follow the money supply?
To my understanding classical economic theory tells us that inflation occurs when the money supply is increased faster than the economic growth.
Lately there has been a sharp rise in the rate of money supply, but GDP has not increased the last…
Hektor-Waartgard
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7
votes
1 answer
Topology on the space of measurable functions
The context is as follows:
Suppose we have a 2 period sequential game, with player $i$ in stage $i$, with action set $A_i$.
Give $A_i$ all the nice properties, as compact, separable metric spaces (I'd be happy to even consider $A_i \subset…
Walrasian Auctioneer
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7
votes
1 answer
Interior Solution for profit maximisation problem
A function $c: \mathbb{R}^K_+ \xrightarrow{} \mathbb{R}_+$ is is said to be a cost function if
The value of function $c$ at $y = \textbf{0}$ is $0$: $c(\textbf{0}) = 0$
$c$ is continuous on the domain $\mathbb{R}^K_+$, strictly increasing and…
Khánh Toàn
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7
votes
1 answer
Replicate Blundell and Bond (2000) results using R
I want to replicate Blundell and Bond (2000) Table III in R. I'm using the function pgmm from package plm, which (apparently) replicates the approach of Stata's xtabond2 (Roonman, 2009). The estimates I get are qualitatively similar, but not the…
antifrax
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7
votes
1 answer
Differential equation for first-price auction
I want to solve a differential equation of the first-price auction. In particular, from Jonathan Levin's October 2004 lecture notes, we have the following differential equation:
$$b'(s) = (s-b(s))(n-1)\frac{f(s)}{F(s)}$$
Solving this, we should…
hrkshr
- 195
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7
votes
1 answer
When do workers versus capital owners share of income increase?
The share of total income obtained by workers rather than capital owners is for obvious reasons of interest. Assuming that the economy can be desribed by an aggregate production function
$$Y = F(K,L)$$
where $K$ is capital input and $L$ is labor…
Jesper Hybel
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7
votes
1 answer
How to get this Production Function in Growth Rates
I'm struggling to understand how Khan & Reinhart (1990) go from the next production function.
$$y=A f(K,L,Z)$$
Where $y$ is the production of the economy, $A$ is a variable which contains the technological change, $K$ is the capital stock of the…
John M. Riveros
- 133
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7
votes
1 answer
M2-M1: what's left in the delta?
If you subtract M2SL - M1SL, the chart looks as follows:
The change is due to re-classification:
M1 before:
(3) other checkable deposits (OCDs), consisting of negotiable order of withdrawal, or NOW, and automatic transfer service, or ATS, accounts…
Sergei Rodionov
- 173
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7
votes
5 answers
How can consumption taxes be made progressive?
Consumption taxes (VAT, sales tax) are mostly applied at a flat rate. Some countries have exemptions or lower ratings for essential goods. But even with that, the tax is much less progressive than other taxes, like income tax.
There have been some…
paj28
- 928
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7
votes
2 answers
Problem with defining liquidity
I have heard multiple times that a consistent definition of liquidity does not exist. The two wikipedia articles describing liquidity (Market liquidity and accounting liquidity) lack a discussion of this apparent problem within economics. Could…
jmbejara
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7
votes
3 answers
Empirical studies on network equilibria
There have been a number of papers in the literature (pioneered by Sanjeev Goyal, Jackson, Kranton, amongst others) emphasising the role and importance of network structure in economics, the equilibrium arising therein and the relationship between…
Bravo
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7
votes
1 answer
Policy relevance of the optimal taxation given uncertainty about social welfare specification
One common criticism in the optimal taxation literature is the specification of the social welfare function. The optimal taxation literature (I have the Mirrlees framework in mind) relies on first specifying a social welfare function. However,…
jmbejara
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- 80
7
votes
2 answers
Applications of Optimal Transport in Economics
The 1975 Nobel Prize winner in Economics was Kantorovich who reformulated the optimal transportation theory of Monge and applied it to optimal resource allocation. The Wasserstein distance is central to this optimization model.
Can anyone familiar…
develarist
- 336
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7
votes
5 answers
How can the stock market keep growing indefinitely?
It sounds like a dumb question, but there is only so much money in the world. Assets can grow, but money can only be printed. So if there is 400 trillion dollars worth of money in the world, and the stock market beats inflation by about 7% each…
Will Kanga
- 171
- 2
7
votes
1 answer
Measuring effects of degree of (buyer) competition on price: references
I would like to examine the effect of degree of competition (market power?) among buyers on price of a product. I have data on product price, number of buyers with nonzero purchases and a couple more variables in multiple (around 400) different…
Richard Hardy
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