DeLong Econ 101b Spring 2018 Draft—Topics and Assignments.ipynb

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    "# 2017-07-30 DeLong Econ 101b Spring 2018 Draft—Topics and Assignments..."
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    "## Econ 101b Spring 2018 Topics and Assignments\n",
    "\n",
    "### Before Class Begins\n",
    "\n",
    "Read: Robert Skidelsky: _Keynes: A Very Short Introduction_ <http://amzn.to/2fTAMiJ>. Start with the first paragraph of chapter 1, then skip forward to chapters 3-5, then read the Epilogue. After that, go back to read the Introduction, chapters 1 and 2, and then chapter 6. Take the Quiz: Skidelsky Keynes Background 101b\n",
    "\n",
    "Read: DeLong and Olney 3rd ed., chs 1-2. \n",
    "\n",
    "* 2017-01-21 Su 5 PM: Oline \"Introduction\" and \"Measuring\" quizzes due.\n",
    "* 2017-01-21 Su 5 PM: (1) Intro to Python/Math Review Problem Set out\n",
    "\n",
    "----\n",
    "\n",
    "### Introduction\n",
    "\n",
    "**2017-01-17 We: Introduction** Logistics, BIG IDEAS, Tools...; D&E ch. 4\n",
    "\n",
    "* 2017-01-21 Su 5 PM: (1) Intro to Python/Math Review Problem Set due\n",
    "* 2017-01-21 Su 5 PM: (2) Economic Growth Problem Set out\n",
    "\n",
    "----\n",
    "\n",
    "### Long-Run Economic Growth\n",
    "\n",
    "**2017-01-22 Mo: Theories of Economic Growth**; D&E ch. 4\n",
    "\n",
    "**2017-01-24 We: Malthusian Economies and the Great Transition**; D&E ch. 5 (first third)\n",
    "\n",
    "**2017-01-29 Mo: Modern American Economic Growth**; D&E ch. 5 (second third)\n",
    "\n",
    "**2017-01-31 We: Cross-Country Income Differentials**; D&E ch. 5 (last third)\n",
    "\n",
    "* 2017-02-04 Su 5 PM: (2) Economic Growth Problem Set due\n",
    "* 2017-02-04 Su 5 PM: (2a) Sample Midterm One out\n",
    "\n",
    "**2017-02-05 Mo: Scenarios for the Future**; D&E ch. 6\n",
    "\n",
    "**2017-02-07 We: Instructor Reality Check \"Midterm\"**; (read D&E ch. 3)\n",
    "\n",
    "* 2017-02-11 Su 5 PM: (3) Flexible Price Economy Problem Set out\n",
    "\n",
    "----\n",
    "\n",
    "### Short-Run Economic Fluctuations: Flexible-Price Macroeconomics\n",
    "\n",
    "**2017-02-12 Mo: General Gluts**; D&E ch. 7\n",
    "\n",
    "**2017-02-14 We: The Full-Employment Long-Run Flexible-Price Macroeconomy: Behavioral Relationships**; D&E ch. 8\n",
    "\n",
    "**2017-02-21 We: The Flexible-Price Economy**; D&E ch. 9\n",
    "\n",
    "* 2017-02-25 Su 5 PM: (3) Flexible Price Economy Problem Set due\n",
    "* 2017-02-25 Su 5 PM: (4) Sticky Price Economy Problem Set out\n",
    "\n",
    "**2017-02-26 Mo: Inflation in the Flexible-Price Economy**; D&E ch. 10\n",
    "\n",
    "----\n",
    "\n",
    "### Short-Run Economic Fluctuations: Sticky-Price Macroeconomics\n",
    "\n",
    "**2017-02-28 We: The Sticky-Price Short-Run Macroeconomy: The Multiplier**; D&E ch. 11\n",
    "\n",
    "**2017-02-05 Mo: The IS Curve**; D&E ch. 12\n",
    "\n",
    "**2017-03-07 We: Financial Crises:**; D&E ch. 13\n",
    "\n",
    "* 2017-03-11 Su 5 PM: (4) Sticky Price Economy Problem Set due\n",
    "* 2017-03-11 Su 5 PM: (5) Sample Second Midterm Problem Set out\n",
    "\n",
    "**2017-03-12 Mo: The Phillips Curve**; D&E ch. 15\n",
    "\n",
    "----\n",
    "\n",
    "### Macroeconomic Policy\n",
    "\n",
    "**2017-03-14 We: 5tabilization Policy** D&E ch. 16\n",
    "\n",
    "* 2017-03-16 Fr 5 PM: (5) Sample Second Midterm Problem Set due\n",
    "\n",
    "**2017-03-19 Mo: Second Midterm** (read D&E ch. 14)\n",
    "\n",
    "**2017-03-21 We: Life at the Zero Lower Bound**; D&E ch. 17\n",
    "\n",
    "* 2017-04-01 Su 5 PM: (6) Sticky-Price Economy Advanced Problem Set out\n",
    "\n",
    "**2017-04-02 Mo: Fiscal Policy Dilemmas**; D&E ch. 18\n",
    "\n",
    "**2017-04-04 We: Secular Stagnation**; D&E ch. 19\n",
    "\n",
    "**2017-04-09 Mo: The Medium Run: Hysteresis**; D&E ch. 20\n",
    "\n",
    "**2017-04-11 We: International Economic Policy**; D&E ch. 21\n",
    "\n",
    "* 2017-04-15 Su 5 PM: (6) Sticky-Price Economy Advanced Problem Set due\n",
    "* 2017-04-15 Su 5 PM: (7) International Economy/Understanding/Forecasting Problem Set out\n",
    "\n",
    "----\n",
    "\n",
    "### Perspectives\n",
    "\n",
    "**2017-04-16 Mo: Changes in the Macroeconomy**; D&E ch. 22\n",
    "\n",
    "**2017-04-18 We: The History of Macroeconomics**; D&E ch. 23 (first half)\n",
    "\n",
    "**2017-04-23 Mo: Understanding 2005-2018 and Forecasting 2018-?:**\n",
    "\n",
    "**2017-04-25 We: The Future of Macroeconomics**;D&E ch. 23 (second half)\n",
    "\n",
    "* 2017-04-29 Su 5 PM: (7) International Economy/Understanding/Forecasting Problem Set due\n",
    "* 2017-04-29 Su 5 PM: (7a) Sample Final Exam Out\n",
    "\n",
    "**2017-05-07 Mo – 2017-05-11 Fr: Exam:**\n"
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    "## DeLong and Olney 3d Edition: Textbook Outline\n",
    "\n",
    "Sections, subsections, and non-example boxes\n",
    "\n",
    "\n",
    "----\n",
    "\n",
    "Preface\n",
    "\n",
    "----\n",
    "\n",
    "**I. Orientation**\n",
    "\n",
    "(I) Introduction (REV)\n",
    "\n",
    "(1) Introduction to Macroeconomics\n",
    "\n",
    "* What is Macroeconomics?\n",
    "    * Why Macroeconomics Matters\n",
    "        * Cultural literacy\n",
    "        * Self interest\n",
    "            * BOX: Data: Macroeconomic policy and your quality of life\n",
    "        * Civic responsibility\n",
    "            * BOX: Economic policy and political popularity\n",
    "    * Macroeconomic Policy\n",
    "        * Growth policy\n",
    "        * Stabilization policy\n",
    "    * Macroeconomics vs. Microeconomics\n",
    "\n",
    "* Tracking the Macroeconomy\n",
    "    * Economic Statistics and Economic Activity\n",
    "    * Six Key Variables\n",
    "        * Real national product\n",
    "            * BOX: Tools: Accounting definitions and statistical discrepancies\n",
    "            * BOX: Data: Real national product per worker in the United States\n",
    "        * The employment rate (REV)\n",
    "            * BOX: Data: Employment, non-employment, and unemployment rates\n",
    "        * The inflation rate\n",
    "            * BOX: Data: U.S. inflation rates\n",
    "        * The interest rate\n",
    "            * BOX: Data: Real interest rates\n",
    "        * The stock market\n",
    "             * BOX: Data: The stock market\n",
    "       * The exchange rate\n",
    "            * BOX: Details: The exchange rate\n",
    "\n",
    "* The Current Macroeconomic Situation\n",
    "    * The United States\n",
    "    * Europe\n",
    "    * Japan\n",
    "    * China (NEW)\n",
    "    * Emerging Markets (REV)\n",
    "\n",
    "----\n",
    "\n",
    "(2) Measuring the Macroeconomy\n",
    "\n",
    "* Macroeconomic Data\n",
    "* The Exchange Rate\n",
    "    * Nominal vs. Real Exchange Rates\n",
    "    * The Real Exchange Rate\n",
    "        * Calculating the real exchange rate\n",
    "            * Index numbers\n",
    "                * BOX: Details: Chain, Lapeyres and Paasche index numbers\n",
    "\n",
    "* The Stock Market and the Interest Rates\n",
    "    * The Stock Market\n",
    "        * The usefulness of knowledge about the stock market\n",
    "        * The stock market summarizes a lot of information\n",
    "    * The Interest Rates\n",
    "\n",
    "* The Price Level and Inflation\n",
    "    * The Consumer Price Index\n",
    "        * The PCE deflator (NEW)\n",
    "        * Kinds of index numbers (REV)\n",
    "    * The Inflation Rate\n",
    "        * Core inflation\n",
    "\n",
    "* The Employment Rate (REV)\n",
    "    * Employment and Unemployment (NEW)\n",
    "        * Assessing full employment (NEW)\n",
    "        * Calculating the unemployment rate\n",
    "        * Understanding the unemployment business cycle (NEW)\n",
    "    * Okun's Law (REV)\n",
    "        * BOX: Details: Forms of Okun's Law\n",
    "\n",
    "* Real National Product\n",
    "    * Calculating Real National Product\n",
    "    * Real and Nominal National Product\n",
    "    * Intermediate Goods, Inventories, and Imputations\n",
    "        * Intermediate goods\n",
    "        * Inventories\n",
    "        * Imputations\n",
    "    * National Product and National Utility (NEW)\n",
    "        * Value of production and human utility (NEW)\n",
    "        * Inequality and human utility (NEW)\n",
    "        * Utility and human well-being (NEW)\n",
    "    * Components of National Product\n",
    "    * What Is and Is Not in National Product\n",
    "        * Gross output, depreciation, and net output\n",
    "        * Government purchases\n",
    "        * National product and national income\n",
    "        * Things that are not in national product—but should be\n",
    "            * Depreciation, pollution, and other \"bads\"\n",
    "\n",
    "----\n",
    "\n",
    "(3) Thinking Like an Economist\n",
    "\n",
    "* Economics: What Kind of Discipline Is It?\n",
    "    * A Social Science\n",
    "    * A Quantitative Social Science\n",
    "    * An Abstract Social Science\n",
    "\n",
    "* The Rhetoric of Economics\n",
    "    * Analogies and Metaphors\n",
    "    * Markets\n",
    "    * Equilibrium\n",
    "    * Graphs and Equations\n",
    "\n",
    "* Model Building: Assumptions\n",
    "    * Simplification\n",
    "    * Representative Agents\n",
    "    * Opportunity Cost\n",
    "    * Expectations\n",
    "        * Static\n",
    "        * Adaptive\n",
    "        * Rational\n",
    "        * Other kinds—Panglossian and Eeyoreian (NEW)\n",
    "\n",
    "* \"Solving\" Models\n",
    "    * Behavioral Relationships\n",
    "        * BOX: Tools: Working with exponents\n",
    "    * Equilibrium Conditions\n",
    "    * Model Solutions\n",
    "        * Arithmetic\n",
    "        * Algebra\n",
    "            * Coefficients\n",
    "            * Parameters\n",
    "                * BOX: Tools: Mathematical rules of thumb\n",
    "        * Analytic geometry\n",
    "    * The Advantages of Math (REV)\n",
    "\n",
    "----\n",
    "\n",
    "**II. Long-Run Economic Growth**\n",
    "\n",
    "(I) Introduction\n",
    "\n",
    "(4) Theories of Economic Growth\n",
    "\n",
    "* Theoretical Sources of Long-Run Growth\n",
    "    * The Efficiency of Labor (REV)\n",
    "        * The level of technology\n",
    "        * The availability of natural resources (NEW)\n",
    "    * Capital Intensity\n",
    "    * Fitting the Two Together\n",
    "    * Demography (NEW)\n",
    "\n",
    "* The Solow Growth Model (REV)\n",
    "    * The Production Function (REV)\n",
    "        * BOX: Details: Forms of the production function\n",
    "    * Saving, Investment, and Capital Accumulation (REV)\n",
    "    * Adding in Labor-Force and Labor-Efficiency Growth (REV)\n",
    "    * The Balanced-Growth Capital-Output Ratio (REV)\n",
    "\n",
    "* Understanding the Solow Growth Model (REV)\n",
    "    * Balanced-Growth Output per Worker (REV)\n",
    "    * Off the Balanced-Growth Path (REV)\n",
    "        * How fast the economy head for its balanced-growth path (REV)\n",
    "    * Using the Solow Growth Model (REV)\n",
    "        * The savings rate and the price of capital goods (REV)\n",
    "        * The labor force growth rate  (REV)\n",
    "        * The growth rate of the efficiency of labor (REV)\n",
    "\n",
    "* The Malthusian Non-Growth Model (NEW)\n",
    "    * Efficiency of Labor (NEW)\n",
    "        * Resource scarcity (NEW)\n",
    "        * Extremely low technological progress (NEW)\n",
    "    * Prosperity and Population Growth (NEW)\n",
    "        * The positive check (NEW)\n",
    "        * The preventative check (NEW)\n",
    "        * Malthusian equilibrium: life nasty, brutish, and short (NEW)\n",
    "            * BOX: Details: Understanding the Malthusian economy\n",
    "\n",
    "* Determinants of Technological and Organizational Progress (NEW)\n",
    "    * Two Heads Are Better than One (NEW)\n",
    "    * Culture (NEW)\n",
    "    * Institutions (NEW)\n",
    "    * Incentives (NEW)\n",
    "\n",
    "----\n",
    "\n",
    "(5) The Reality of Economic Growth: History\n",
    "\n",
    "* After the Invention of Agriculture (REV)\n",
    "    * Premodern Economies (REV)\n",
    "    * Prosperity and Labor Force Growth (REV)\n",
    "    * The Malthusian Trap (REV)\n",
    "    * Why Was Technological and Organizational Progress so Slow? (REV)\n",
    "\n",
    "* The Industrial Revolution (REV)\n",
    "    * The End of the Malthusian Age (REV)\n",
    "        * The initial breakthrough (REV)\n",
    "        * The demographic transition (REV)\n",
    "        * Industrial Revolution (REV)\n",
    "\n",
    "* Modern American Economic Growth\n",
    "    * American Growth, 1800-1870\n",
    "    * American Growth, 1870-1973\n",
    "        * The pace of economic growth\n",
    "        * Structural change\n",
    "        * America's edge\n",
    "        * The Great Depression and World War II\n",
    "    * The Productivity Slowdown, 1973-1995\n",
    "        * BOX: Details: Did real standards of living decline during the productivity slowdown period?\n",
    "    * American Economic Growth, 1995-2007 (REV)\n",
    "        * The productivity growth slowdown (REV)\n",
    "        * The Information Age speedup (REV)\n",
    "    * American Economic Growth, 2007-Present (NEW)\n",
    "        * Financial crisis and the Great Recession (NEW)\n",
    "        * Low investment (NEW)\n",
    "        * \"Hysteresis\" (NEW)\n",
    "\n",
    "* Modern Economic Growth Around the World\n",
    "    * Divergence, Bigtime\n",
    "        * BOX: Tools: Purchasing power parity and real exchange rate comparisons\n",
    "        * The exception: the OECD\n",
    "            * BOX: Policy: Why have these countries converged?\n",
    "        * The rule: divergence behind the Iron Curtain\n",
    "        * The rule: divergence in merging markets\n",
    "    * China and the Pacific Rim (NEW)\n",
    "        * The Pacific Rim (REV)\n",
    "            * BOX: Policy: The Pacific Rim miracle\n",
    "        * China (NEW)\n",
    "            * BOX: Policy: The Chinese supermiracle\n",
    "    * Sources of Divergence\n",
    "        * Global patterns\n",
    "            * Cause and effect, effect, and cause\n",
    "                * BOX: Policy: Post-communism\n",
    "    * Global and within-National Inequality (NEW)\n",
    "\n",
    "----\n",
    "\n",
    "(6) The Reality of Economic Growth: Prospect\n",
    "\n",
    "* Hopes for Convergence\n",
    "    * Relative and Absolute Stagnation\n",
    "    * Half Empty and Half Full\n",
    "\n",
    "* Policies for Saving, Investment, and Education\n",
    "    * Saving and Investment\n",
    "        * A high pressure economy\n",
    "    * Education\n",
    "\n",
    "* Policies for Technological Advance and Organizational Improvement (REV)\n",
    "    * invention and innovation (REV)\n",
    "        * Rivalry and excludability (REV)\n",
    "        * Patents and copyrights (REV)\n",
    "    * Government failure (REV)\n",
    "\n",
    "* \"Neoliberalism\" (REV)\n",
    "\n",
    "* Future Growth and Inequality (NEW)\n",
    "\n",
    "----\n",
    "\n",
    "**III. Flexible-Price Macroeconomics**\n",
    "\n",
    "Introduction\n",
    "\n",
    "(7) Circular Flows and General Gluts (NEW)\n",
    "\n",
    "* The Circular Flow of Economic Activity (REV)\n",
    "    * The Circular Flow Diagram (REV)\n",
    "    * Different Measures of the  Circular Flow: Demand, Sales, Production, Income, Spending (REV)\n",
    "    * Walras's Law, Say's Law, and the Circular Flow (NEW)\n",
    "\n",
    "* Breaking the Automatic Equality of the Circular Flow (NEW)\n",
    "    * Money Is a Special Commodity (NEW)\n",
    "    * Excess Demand for Money: Depression and \"General Glut\" (NEW)\n",
    "    * Excess Supply of Money: Inflation and \"Too Much Money Chasing too Few Goods\" (NEW)\n",
    "    * What Is \"Money\" Here? (NEW)\n",
    "        * Liquid assets (NEW)\n",
    "        * Safe assets (NEW)\n",
    "        * Savings vehicles (NEW)\n",
    "\n",
    "----\n",
    "\n",
    "(8) Building Blocks of the Flexible-Price Model\n",
    "\n",
    "* Potential Output and Real Wages\n",
    "    * The Production Function (REV)\n",
    "    * The Invariance of Potential Output to the Cycle (NEW)\n",
    "    * The Labor Market\n",
    "        * Labor demand\n",
    "        * Labor supply\n",
    "        * Labor market equilibrium and real wages (REV)\n",
    "\n",
    "* Spending on Domestically-Produced Goods\n",
    "    * Consumption Spending\n",
    "        * Household decisions\n",
    "        * The marginal propensity to consume\n",
    "        * Baseline consumption\n",
    "    * Investment Spending\n",
    "            * BOX: Details: Kinds of investment\n",
    "        * Why firms invest\n",
    "            * Interest rates\n",
    "            * Animal spirits\n",
    "            * The role of expectations\n",
    "        * The investment function\n",
    "    * Government purchases\n",
    "    * Net exports\n",
    "* The Role of International Trade\n",
    "    * Gross exports\n",
    "    * Imports\n",
    "    * Net exports\n",
    "    * The exchange rate\n",
    "        * The role of interest rates and expectations\n",
    "            * BOX: Details: The j-curve\n",
    "\n",
    "* Conclusion\n",
    "\n",
    "----\n",
    "\n",
    "(9) Equilibrium in the Flexible-Price Model\n",
    "\n",
    "* Full Employment Equilibrium\n",
    "    * The Flow-of-Funds Approach\n",
    "    * The Assumption of Wage and Price Flexibility\n",
    "        * BOX: Details: If prices were truly flexible\n",
    "\n",
    "* Two Approaches, One Model\n",
    "    * Using the Circular Flow Diagram\n",
    "        * BOX: Details: Financial transactions and the flow of funds\n",
    "    * Using Some Algebra\n",
    "    * Unpacking the Flow-of-Funds Equation\n",
    "\n",
    "* The Real Interest Rate Is What Adjusts to Lead to Equilibrium\n",
    "    * Graphing the Saving-Investment Relationship\n",
    "        * BOX: Details: Deriving the equilibrium interest rate equation\n",
    "    * The Adjustment to Equilibrium\n",
    "\n",
    "* Using the Model: What Makes the Real Interest Rate Change?\n",
    "    * The Effect of a Change in Saving\n",
    "    * The Effect of a Change in Investment Demand\n",
    "    * The Effect of a Change in Government Purchases\n",
    "    * The Effect of a Change in Demand for Exports\n",
    "\n",
    "* Calculating the Equilibrium Real Interest Rate: Some Algrebra\n",
    "    * The Formula for the Equilibrium Real Interest Rate\n",
    "    * Interpreting the Real Interest Rate Equation\n",
    "    * Determining the Effect of a Change in Policy on the Components of Aggregate Demand \n",
    "        * Government purchases\n",
    "        * Saving and investment\n",
    "        * Exports and imports\n",
    "        * Consumption\n",
    "\n",
    "* Conclusion\n",
    "\n",
    "----\n",
    "\n",
    "(10) Money, Prices, and Inflation\n",
    "\n",
    "* Money\n",
    "    * Liquid Wealth That Can Be Used to Buy Things\n",
    "        * The usefulness of money\n",
    "        * Units of account\n",
    "\n",
    "* The Quantity Theory of Money\n",
    "    * The Demand for Money\n",
    "    * The Quantity Equation\n",
    "        * Say's Law again (NEW)\n",
    "    * Money and Prices\n",
    "        * The price level\n",
    "        * The money stock\n",
    "            * BOX: Details: Different definitions of the money stock\n",
    "        * The rate of inflation\n",
    "        * Inflation and the nominal interest rate\n",
    "\n",
    "* The Economic Costs of Inflation\n",
    "    * The Costs of Moderate Expected Inflation\n",
    "    * Hyperinflation and Its Costs\n",
    "\n",
    "----\n",
    "\n",
    "**IV. Sticky-Price Macroeconomics**\n",
    "\n",
    "(I) Introduction\n",
    "\n",
    "11. The Sticky-Price Income-Expenditure Framework: Consumption and the Multiplier\n",
    "\n",
    "* Sticky Prices\n",
    "    * Sticky Prices\n",
    "    * Consequences of Sticky Prices\n",
    "        * Breaking Say's Law (NEW)\n",
    "        * Flexible-price logic\n",
    "        * Sticky-price logic\n",
    "        * Expectations and price stickiness\n",
    "    * Why Are Prices Sticky?\n",
    "\n",
    "* Income and Spending\n",
    "    * Building Up Planned Total Spending\n",
    "        * The consumption function\n",
    "        * Other components of total spending\n",
    "    * Sticky-Price Equilibrium\n",
    "\n",
    "* The Multiplier\n",
    "    * Determining the Size of the Multiplier\n",
    "\n",
    "----\n",
    "\n",
    "(12) Investment, Net Exports, and Interest Rates: The IS Curve\n",
    "\n",
    "* Interest Rates and Planned Total Spending\n",
    "    * The Importance of Investment\n",
    "        * The role of investment\n",
    "        * Sources of fluctuations in investment\n",
    "    * Investment and the Real Interest Rate\n",
    "        * The long-term interest rate\n",
    "        * The real interest rate\n",
    "        * The risky interest rate\n",
    "    * The Investment Accelerator (NEW)\n",
    "        * BOX: Tools: The stock market as an indicator of future investment\n",
    "    * Bankruptcy and Investment (NEW)\n",
    "        * Would less sticky prices really be a help? (NEW)\n",
    "    * Exports and Autonomous Spending\n",
    "\n",
    "* The IS Curve\n",
    "    * Autonomous Spending and the Real Interest Rate\n",
    "        *  From the interest rate to investment to planned total spending\n",
    "    * The Slope and Position of the IS Curve\n",
    "        * The slope of the IS curve\n",
    "        * The position of the IS curve\n",
    "        * How the economy moves to the IS curve\n",
    "            * BOX: Details: How fast does the economy move to equilibrium?\n",
    "    * The \"neutral\" interest rate of Knut Wickse (NEW)\n",
    "\n",
    "* Using the IS Curve to Understand the Economy\n",
    "    * BOX: Policy: Costs of low employment\n",
    "    * Shifting the IS Curve\n",
    "    * Moving Along the IS Curve\n",
    "        * Difficulties\n",
    "    * Economic Fluctuations in the United States: Using the IS Curve as a Lens\n",
    "        * The 1960s\n",
    "        * The 1980s\n",
    "        * The 1990s\n",
    "        * The early 2000s\n",
    "        * The Great Recession (NEW)\n",
    "        * The Longer Depression (NEW)\n",
    "\n",
    "----\n",
    "\n",
    "(13) Financial Crisis: Asset Prices, Leverage, Bankruptcies (NEW)\n",
    "\n",
    "* Asset Prices and Returns (NEW)\n",
    "    * The Equity Return Premium (NEW)\n",
    "    * \"Convexity\" in Financial Rewards (NEW)\n",
    "\n",
    "* Manias (NEW)\n",
    "    * Credit Expansion (NEW)\n",
    "    * Euphoria and Leverage (NEW)\n",
    "    * Policy Responses (NEW)\n",
    "\n",
    "* Panics and Crises (NEW)\n",
    "    * Greater Fools (NEW)\n",
    "    * Positive Feedback (NEW)\n",
    "    * Liquidation (NEW)\n",
    "    * Contagion (NEW)\n",
    "    * The Bagehot Rule, and the Lender of Last Resort (NEW)\n",
    "\n",
    "* Consequences (NEW)\n",
    "    * The Credit Channel and Investment (NEW)\n",
    "    * Liquidation and Confidence (NEW)\n",
    "    * Recovery? (NEW)\n",
    "\n",
    "* 2007-2009 (NEW)\n",
    "\n",
    "----\n",
    "\n",
    "(14) The Money Market and the LM Curve\n",
    "\n",
    "* The Money Market and the Money Stock\n",
    "    * Wealth, Bonds, and the Demand for Money\n",
    "        * BOX: Details: Money demand and the quantity theory\n",
    "        * BOX: Details: Bond prices and interest rates\n",
    "    * Money Supply and Money Demand\n",
    "    * Adjustment to Equilibrium\n",
    "\n",
    "* The LM Curve\n",
    "    * Interest Rates and Total Income\n",
    "    * Drawing the LM Curve\n",
    "    * The Zero Lower Bound on Interest Rates (NEW)\n",
    "\n",
    "* The IS-LM Framework\n",
    "    * The IS-LM Diagram\n",
    "    * IS Shocks\n",
    "    * LM Shocks\n",
    "    * \"Spread\" Shocks\n",
    "    * At the Zero Lower Bound (NEW)\n",
    "    * Classifying Economic Disturbance\n",
    "       *  Changes that affect the IS curve\n",
    "        * Changes that affect the LM curve\n",
    "        * Changes that affect the spread\n",
    "\n",
    "* Aggregate Demand and Aggregate Supply\n",
    "    * The Price Level and Aggregate Demand\n",
    "    * The Price Level and Aggregate Supply\n",
    "    * The AS-AD Diagram\n",
    "        * BOX: Details: A shock to aggregate demand\n",
    "\n",
    "----\n",
    "\n",
    "(15) The Phillips Curve, Expectations, and Monetary Policy\n",
    "\n",
    "* Aggregate Supply and the Phillips Curve\n",
    "    * Employment, Full Employment, and Unemployment\n",
    "    * Aggregate Supply\n",
    "    * The Phillips Curve Examined\n",
    "        BOX: Details: Forms of Okun's Law\n",
    "\n",
    "* Monetary Policy, Aggregate Demand, and Inflation\n",
    "    * The Reaction of Monetary Policy to Inflation\n",
    "        * BOX: Details: From income-spending to the MPRF\n",
    "    * Equilibrium: The MPRF and the Phillips Curve\n",
    "    * Using the MPRF-Phillips Curve Model\n",
    "\n",
    "* The Natural Rate of Employment and Unemployment (REV)\n",
    "    *  Demography  (REV)\n",
    "    * Institutions (REV)\n",
    "    * Productivity Growth (REV)\n",
    "    * The Past (REV)\n",
    "    * The Fluctuating Natural Rate (REV)\n",
    "\n",
    "* \"Expected\" Inflation\n",
    "    * The Phillips Curve under Static Expectations\n",
    "    * The Phillips Curve under Adaptive Expectations\n",
    "        * BOX: Policy: Adaptive expectations and the Volcker disinflation\n",
    "    * The Phillips Curve under Rational Expectations\n",
    "        * BOX: Details: The structure of the economy and the Lucas critique\n",
    "        * Economic policy under rational expectations\n",
    "    * What Kind of Expectations Do We Have?\n",
    "        * Persistent contracts\n",
    "        * Sticky mental models\n",
    "\n",
    "* From the Short Run to the Long Run\n",
    "    * Under Rational Expectations\n",
    "    * Under Adaptive Expectations\n",
    "    * Under Static Expectations\n",
    "\n",
    "----\n",
    "\n",
    "**V. Macroeconomic Policy**\n",
    "\n",
    "(I) Introduction\n",
    "\n",
    "16. Stabilization Policy\n",
    "\n",
    "* Monetary Policy Institutions (REV)\n",
    "    * BOX: Details: Leading indicators\n",
    "    * The Federal Reserve Board (REV)\n",
    "    * The Federal Open Market Committee (REV)\n",
    "    * The History of the Federal Reserve (REV)\n",
    "    * How the Federal Reserve Operates (REV)\n",
    "        * BOX: Details: The money multiplier\n",
    "\n",
    "* Fiscal Policy Institutions (REV)\n",
    "    * The Budget Cycle in Theory (REV)\n",
    "    * The Budget Cycle in Practice (REV)\n",
    "\n",
    "* The History of Stabilization Policy\n",
    "    * The Employment Act of 1946\n",
    "    * Keynesian Overoptimism and the Monetarist Correction\n",
    "    * Monetary Management in the 1980s and 1990s\n",
    "    * The \"Great Moderation\" Overoptimism and Its Correction (NEW)\n",
    "        * Financial deregulation and \"Greenspanism\" (NEW)\n",
    "    * The Great Recession and the Longer Depression (NEW)\n",
    "        * Monetary caution (NEW)\n",
    "        * Fiscal austerity (NEW)\n",
    "\n",
    "* The Power and Limits of Stabilization Policy\n",
    "    * Economists' Disagreements (REV)\n",
    "    * The Implications of Uncertainty\n",
    "    * The Money Supply as a Leading Indicator\n",
    "    * Long Lags and Variable Effects\n",
    "        * BOX: Policy: The limits of stabilization policy\n",
    "        * BOX: Details: When is there a political business cycle?\n",
    "\n",
    "* Monetary vs. Fiscal Policy (REV)\n",
    "    * Relative Power (REV)\n",
    "    * Fiscal Policy: Automatic Stabilizers\n",
    "        * BOX: Policy: Tax cuts and economic stimulus\n",
    "    * How Monetary Policy Works\n",
    "        * BOX: Policy: Standard monetary policy instruments\n",
    "        * At the zero lower bound (NEW)\n",
    "\n",
    "* Making Good Stabilization Policy: Rules vs. Authorities\n",
    "    * Competence and Objectives\n",
    "        * BOX: Policy: The political business cycle and Richard Nixon\n",
    "    * Credibility and Commitment\n",
    "    * Modern Monetary Policy (REV)\n",
    "\n",
    "* Financial Crises (NEW)\n",
    "    * Lenders of Last Resort (NEW)\n",
    "    * Deposit Insurance and Moral Hazard (NEW)\n",
    "\n",
    "----\n",
    "\n",
    "(17) Monetary Policy and the Lower Bound on Interest Rates (NEW)\n",
    "\n",
    "* How Does the Central Bank Affect Interest Rates? (NEW)\n",
    "    * Open Market Operations in Short-Term Government Securities  (NEW)\n",
    "    * What Happens When They and Money Become Perfect Substitutes? (NEW)\n",
    "\n",
    "* Non-Standard Monetary Policies (NEW)\n",
    "    * Forward Guidance (NEW)\n",
    "    * Quantitative Easing (NEW)\n",
    "    * Other Expedients (NEW)\n",
    "\n",
    "* Optimal Policy Near the Zero Lower Bound (NEW)\n",
    "    * Optimal Control (NEW)\n",
    "    * The Value of Not Having to Worry (NEW)\n",
    "    * Can We Understand Federal Reserve, ECB, and BoJ Policy? (NEW)\n",
    "\n",
    "----\n",
    "\n",
    "(18) Budget Balance, National Debt, and Investment\n",
    "\n",
    "* The Budget Deficit and Stabilization Policy\n",
    "    * The Budget Deficit and the IS Curve\n",
    "    * Measuring the Budget Balance\n",
    "\n",
    "* Measuring the Debt and the Deficit\n",
    "    * Inflation\n",
    "    * Public Investment\n",
    "    * Future Government Liabilities\n",
    "    * Generational Accounting\n",
    "\n",
    "* Analyzing the Debt and the Deficit (REV)\n",
    "    * BOX: Data: The U.S. debt-to-national-product ratio\n",
    "    * Sustainability (REV)\n",
    "        * The equilibrium debt-to-national-product ratio (REV)\n",
    "        * Is the equilibrium debt-to-national-product ratio possible? (REV)\n",
    "        * Risks (NEW)\n",
    "    * Economic Effects of Deficits and Debt (REV)\n",
    "    * Political Effects of Deficits (REV)\n",
    "    * Deficits and Planned Spending (REV)\n",
    "    * International Effects of Deficits (REV)\n",
    "    * Deficits and Long-Run Growth (REV)\n",
    "    * Debt Service, Taxation, and Real National Product\n",
    "\n",
    "----\n",
    "\n",
    "(19) Secular Stagnation (NEW)\n",
    "\n",
    "* Ideas of Secular Stagnation in History (NEW)\n",
    "    * John A. Hobson (NEW)\n",
    "    * Alvin Hansen (NEW)\n",
    "    * Larry Summers (NEW)\n",
    "\n",
    "* Causes of Secular Stagnation (NEW)\n",
    "    * Supply of Savings (NEW)\n",
    "    * Demands for Investment Projects (NEW)\n",
    "    * Outsized Risk Premiums (NEW)\n",
    "\n",
    "* Cures for Secular Stagnation (NEW)\n",
    "    * Higher Inflation Targets (NEW)\n",
    "    * Higher Government Debt Levels (NEW)\n",
    "    * Mobilizing Risk Bearing Capacity (NEW)\n",
    "    * Raising the Profitability of Investment (NEW)\n",
    "\n",
    "----\n",
    "\n",
    "(20) From the Short Run to the Long Run: Hysteresis (NEW)\n",
    "\n",
    "* Short-Run Performance of Potential Output Growth (NEW)\n",
    "    * Investment (NEW)\n",
    "    * Business Models (NEW)\n",
    "    * Technological Advance (NEW)\n",
    "    * Labor Attachment (NEW)\n",
    "\n",
    "* Changing the Policy Calculus (NEW)\n",
    "    * Externalities from a High Pressure Economy (NEW)\n",
    "    * The True Long-Run Cost of Expansionary Policies (NEW)\n",
    "\n",
    "* How Important Is This \"Hysteresis\"? (NEW)\n",
    "    * Europe in the 1980s (REV)\n",
    "    * The North Atlantic After 2009 (NEW)\n",
    "    * The Broader Historical Record (NEW)\n",
    "\n",
    "----\n",
    "\n",
    "(21) International Economic Policy\n",
    "\n",
    "* The History of Exchange Rates\n",
    "    * The Classical Gold Standard\n",
    "        * What is the gold standard?\n",
    "        * A gold standard tends to produce contractionary policies\n",
    "    * The Collapse of the Gold Standard\n",
    "    * The Bretton Woods System\n",
    "    * Our Current Floating Rate System (REV)\n",
    "\n",
    "* How a Fixed Exchange Rate System Works\n",
    "    * High Capital Mobility\n",
    "    * Barriers to Capital Mobility\n",
    "\n",
    "* The Choice of Exchange Rate Systems (REV)\n",
    "    * Benefits of Fixed Exchange Rates (REV)\n",
    "    * Costs of Fixed Exchange Rates (REV)\n",
    "\n",
    "* Currency Crises\n",
    "    * The European Crisis of 1992\n",
    "    * The Mexican Crisis of 1994-95\n",
    "    * The East Asian Crisis of 1997-98\n",
    "    * The Dollar in the 2000s (REV)\n",
    "    * Managing Crises (REV)\n",
    "\n",
    "----\n",
    "\n",
    "**VI. Perspective**\n",
    "\n",
    "(I) Introduction\n",
    "\n",
    "(22) Changes in the Macroeconomy and Changes in Macroeconomic Policy\n",
    "\n",
    "* Changes in the Macroeconomy\n",
    "    * The Past\n",
    "    * The Future  (REV)\n",
    "        * Consumption (REV)\n",
    "        * Globalization (REV)\n",
    "        * Monetary policy (REV)\n",
    "        * Inventories (REV)\n",
    "\n",
    "* The History of Macroeconomic Fluctuations\n",
    "    * Estimating Long-Run Changes in Cyclical Volatility\n",
    "    * Economic Policy\n",
    "        * How economic policy has worked (REV)\n",
    "        * How economic policy has not worked (REV)\n",
    "            * BOX: Policy: The Bush 2001 tax cut\n",
    "\n",
    "* Understanding the Great Depression of the 1930s\n",
    "    * The Magnitude of the Great Depression\n",
    "    * Deflation, High Real Interest Rates, and Bankruptcies\n",
    "\n",
    "* Understanding the Moderate Inflation of the 1970s (NEW)\n",
    "    * The Deanchoring of Expectations (NEW)\n",
    "    * Supply Shocks (NEW)\n",
    "    * Macroeconomic Policy from Late Martin to Volcker (NEW)\n",
    "\n",
    "* Understanding 2005-2018 (NEW)\n",
    "    * The Global Savings Glut (NEW)\n",
    "    * The Housing Bubble and the Deregulatory Mania (NEW)\n",
    "    * The Crash (NEW)\n",
    "    * Policy Response (NEW)\n",
    "    * The Longer Depression (NEW)\n",
    "\n",
    "* Macroeconomic Policy: Lessons Learned (REV)\n",
    "    * Stabilization (REV)\n",
    "    * Learning (REV)\n",
    "    * Prospects (REV)\n",
    "\n",
    "* Macroeconomic Policy: Lessons Un- or Half-Learned (REV)\n",
    "    * Hysteresis: From High European Unemployment in the 1980s to Today (REV)\n",
    "        * Grand bargains? (REV)\n",
    "    * The Zero Lower Bound: From Japan in the 1990s to Today (REV)\n",
    "        * The end of the bubble economy (REV)\n",
    "        * Deflation (NEW)\n",
    "        * Debt expansion (NEW)\n",
    "    * Moral Hazard in Finance (REV)\n",
    "    * The Utility of Stabilization Policy (REV)\n",
    "        * BOX: Policy: Central bank independence\n",
    "    * The Ultimate Lesson (REV)\n",
    "\n",
    "----\n",
    "\n",
    "(23) The Past and Future of Macroeconomics\n",
    "\n",
    "* The Past of Macroeconomics (REV)\n",
    "    * Jean-Baptiste Say, Thomas Robert Malthus, and John Stuart Mill (NEW)\n",
    "    * Walter Bagehot and Robert Peel (NEW)\n",
    "    * Knut Wicksell and Irving Fisher (NEW)\n",
    "    * The Age of John Maynard Keynes\n",
    "    * The Age of Milton Friedman (REV)\n",
    "\n",
    "* The Present of Macroeconomics (NEW)\n",
    "    * The Influence of Robert Lucas (NEW)\n",
    "        * Rational expectations as a requirement (NEW)\n",
    "        * Fiscal policy pessimism (NEW)\n",
    "        * The turn to real factors (NEW)\n",
    "    * The Influence of Edward Prescott (REV)\n",
    "        * Supply shocks (REV)\n",
    "        * The unevenness of economic growth (REV)\n",
    "            * Investment responses to productivity shocks (REV)\n",
    "        * Bad RBC theories (NEW)\n",
    "            * Full employment (NEW)\n",
    "            * Technological regress (NEW)\n",
    "            * Money and real business cycles (NEW)\n",
    "    * The New Keynesian Approach (REV)\n",
    "    *  The Central Banking Analysis and Private Forecasting Tradition (NEW)\n",
    "    * Debts and Deficits (REV)\n",
    "        * Ricardian equivalence (REV)\n",
    "            * Counterarguments (REV)\n",
    "        * Consumption and saving (REV)\n",
    "\n",
    "* The Future of Macroeconomics  (REV)\n",
    "    * Beyond \"New Keynesianism\" (REV)\n",
    "        * Menu costs and sticky beliefs (REV)\n",
    "            * Real expectational modeling (REV)\n",
    "        * Coordination failures (NEW)\n",
    "    * The Microeconomic Turn (NEW)\n",
    "        * What are the emergent macroeconomic properties given how economic agents really behave? (NEW)\n",
    "    * How Does Monetary Policy Really Work, Anyway? (NEW)\n",
    "\n",
    "----\n",
    "\n",
    "Glossary\n",
    "\n",
    "Index"
   ]
  }
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