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1500 questions
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2 answers
Why is modest inflation a good thing?
I have been reading a BBC news article about inflation in the UK, which is saying that inflation has recently become negative (http://www.bbc.co.uk/news/business-33147660). The article suggests that this is a bad thing. However, I would have thought…
Karnivaurus
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Do general equilibrium models include money?
An economics professor told me that General Equilibrium models are a sophistication of barter. Does that imply that they don't include money? And if that is the case, are there any attempts to include it?
Moreover, does this have any implications on…
numberfive
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Is there an economic reason why employees don't share salary information with each other?
In Western society, one's salary is often a taboo topic and people tend to not tell other people what they earn.
In China by contrast, I have been told that asking one's salary is fairly normal social discourse.
It seems that employees being aware…
dwjohnston
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5
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2 answers
What utility functions are equivalent to additive functions?
Call a utility function $u(x,y)$ additive if there exist functions $v_x,v_y$ such that:
$$u(x,y)=v_x(x)+v_y(y)$$
Consider the function $u(x,y)=xy$. It is not additive, but, it can transformed using a positive-monotonic-transformation (PMT) to the…
Erel Segal-Halevi
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How do you determine the strict core in a matching game?
So I have a game in which home owners prefer certain other's homes. The owners are A, B, C, and D with a, b, c, and d referring to their respective homes. They each prefer homes according to the ranking
A: bdac
B: cadb
C: dbca
D: acbd
I've read…
Addem
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5
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1 answer
Is the contract curve orthogonal to the priceline?
Consider an exchange economy with two consumers A and B, two goods x, y. Consumers have identical preferences $U=xy$. Total available endowment are $E_x$ and $E_y$.
This is the background of a homework question which does not ask but I got this…
Bob
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5
votes
2 answers
heteroskedasticity variance estimator bias direction
If I have a model with heteroskedasticity issue, can I tell the bias direction of the coefficents variance estimator?
I would think that because I would correct it with WLS then I get BLUE (Best Linear, Unbiased Estimator) which means the variance…
user5344
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5
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3 answers
How can valuable retail real-estate stay vacant for an extended period of time?
Anecdotally, the story often goes like this:
A land owner leases his commercial retail space at an expensive price. The place stays vacant for months or years at a time. Eventually someone decides to lease the place. The rents are very expensive and…
Jamzy
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How do supply chains form?
I am trying to put forth a theory for endogenous supply chain formation. A set of $K$ complementary tasks need to be performed to manufacture a good $G$. If manufactured, there exists a demand function $d(p_G,q_G)$ that governs the price of the good…
Bravo
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5
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1 answer
Interpreting the ratio of two variances in a Bayesian decision problem
Given a normal prior with mean $\mu_0$ and variance $\sigma_0^2$, and a normal likelihood with known variance $\sigma^2$, the Bayesian posterior, after observing $n$ iid signals $x_1,\dots,x_n$, is also a normal distribution with…
Herr K.
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5
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1 answer
Are prepaid cards, and gift cards considered a form of money?
Are the followings considered a form of money
prepaid (debit) cards
gift cards (both bank-issued such as American Express gift cards, and store-issued such as Walmart gift cards) ?
Are their balances considered demand deposits, and therefore in…
Tim
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votes
5 answers
What is the difference between present value and face value?
What is the difference between present value and face value?
When I search this question on Google is says they're the same in some cases and different in others. It says they are the same when the market interest rate is the same as the…
Adam Staples
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1 answer
What term/theory describes more efficient utilization of a resource?
I may be asking the wrong question here, but I wonder if there is a term/theory that describes/studies the evolution of an economy that continually improves the utilization and allocation of certain resource? The resource here can be different…
skyork
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5
votes
3 answers
Two variables: Which moves first?
Say I have a time series of two variables, $X$ and $Y$, and want to find out which one of these two moves first. One example is the one of GDP growth and investment growth, where we usually tell the story that at a business cycle frequency,…
FooBar
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5
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Why are New Zealand houses so badly insulated?
New Zealand is relatively new country.
It essentially was founded in 1840 in a contract between the native Maori people and the British Government.
For some reason a large chunk of the housing stock in New Zealand is badly insulated and drafty and…
dwjohnston
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