巴罗宏观经济学：现代观点第6章课件

1、Markets in the MacroeconomyAssuming that households perform all of the functions in the economy. Each household runs a family business and uses labor, L, and capital, K, to produce goods, Y, through the production function.Y= A F( K, L)Macroeconomics Chapter 6 1Markets in the MacroeconomyMacroeconom

2、ics Chapter 6 2Goods marketLabor marketRental marketBond marketHouseholds Households(Firms) The Goods MarketHouseholds sell all the goods they produce on a goods market. Then households buy back from this market the goods that they want. Household buys goods for consumption. to increase the stock of

3、 goods in the form of capital used for production, called investment.Macroeconomics Chapter 6 3The Goods Market and PricesThe price in this goods market, denoted by P, expresses the number of dollars that exchange for one unit of goods. We call P the price level.Macroeconomics Chapter 6 4The goods M

4、arket and PricesY= A F( K, L)Since all of these goods are sold on the goods market, the variable Y will also represent theQuantity of goods per year sold and bought on the goods market. The quantity PY is the dollar value per year of the goods bought and sold on the goods market.Macroeconomics Chapt

5、er 6 5The goods Market and PricesThe expression 1/P is the value of $1 in terms of the goods that it buys.M dollars exchange for (M) (1/ P) = M/PAn expression like M/P is in real terms, in units of goods, whereas a quantity like M is in dollar or nominal terms.Macroeconomics Chapter 6 6Labor Market

6、in the MacroeconomyHouseholds supply labor on a labor market. Assume that the quantity supplied, Ls, is a constant, L.Households buy and sell labor in the labor market at the dollar or nominal wage rate, w.The real wage rate is w/P.Macroeconomics Chapter 6 7Rental Markets in the MacroeconomyEach hou

7、sehold rents out all of the capital that it owns on a rental market.We think of the capital offered on the rental market as the supply of capital services, Ks. Since we have assumed that each household rents out all of its capital, we have Ks = K.Macroeconomics Chapter 6 8Rental Markets and PricesHo

8、useholds rent out capital, K, for dollars at the dollar or nominal rental price, RA household that rents the amount of capital Kd pays the nominal amount RKd per year and then gets to use the capital as an input to production.The real rental price is R/P.Macroeconomics Chapter 6 9The Bond Market in

9、the MacroeconomyA borrowing household receives a loan from another household, whereas a lending household provides a loan to another household.A household that makes a loan receives a piece of paper called a bond, and we call the market on which households borrow or lend the bond market. The holder

10、of a bond, the lender, has a claim to the amount owed by the borrower.Macroeconomics Chapter 6 10The bond Market and PricesEach unit of bonds commits the borrower to repay $1 to the holder of the bond. This $1 is the principal of each bond. The principal is the initial amount advanced on a loan.Macr

11、oeconomics Chapter 6 11The Bond Markets and PricesEach unit of bonds commits the borrower to pay the holder a flow of interest payments of $i per year. The variable i is the interest rate, which is the ratio of the interest payment, $i, to the principal $1. The interest rate, i, can vary over time.M

12、acroeconomics Chapter 6 12Money as a Medium of ExchangeWe assume that the exchanges on each of these markets use a single form of medium of exchange.A medium of exchange is an object held, not for its own sake, but rather to trade fairly soon for something else, such as goods and services. We call t

13、he medium of exchange in our model money.Macroeconomics Chapter 6 13Money as a Medium of ExchangeAssume that money is just a piece of paper, analogous to a paper currency issued by a government.Money is denominated in an arbitrary unit, such as a “dollar.”Dollar amounts are in nominal terms.Paper mo

14、ney earns no interest.Macroeconomics Chapter 6 14Money as a Medium of ExchangeThe sum of the individual holdings of money equals the aggregate quantity of money in the economy. Assume, for now, that this aggregate quantity of money is a given constant.The total money held by all households must end

15、up equaling this constant.Macroeconomics Chapter 6 15Constructing the Budget ConstraintThe quantities and prices determined on the four markets will determine household income.Flows of income are sources of fundsPurchases of goods and assets are uses of fundsThe total sources of funds must equal the

16、 total uses of funds. This equality is called the household budget constraint.Macroeconomics Chapter 6 16Constructing the Budget ConstraintIncomeProfitsHouseholds may earn profitan excess of revenue over costsfrom their business activities.Y= A F( Kd, Ld ) = PY (wLd+ RKd) = P A F( Kd, Ld ) ( wLd+ RK

17、d)Macroeconomics Chapter 6 17Constructing the Budget ConstraintIncomeWage income If households supply the quantity of labor Ls to the labor market, they receive the nominal wage income of wLs per year. Quantity of labor supplied is the fixed amount L, so nominal wage income is wL.Macroeconomics Chap

18、ter 6 18Constructing the Budget ConstraintIncomeRental income If households supply the quantity of capital Ks to the rental market they receive the nominal rental income of RKs per year. Since households supply all of their available capital, K, to the rental market, so that Ks = K, the nominal rent

19、al income is RK.Macroeconomics Chapter 6 19Constructing the Budget ConstraintRental incomeThe quantity K of capital disappears each year. The dollar value of this lost capital is PK.net nominal rental income= nominal rental income value of depreciationnet nominal rental income = RKPKnet nominal rent

20、al income = (R/P)PKPKnet nominal rental income= (R/P)PKRate of return on owning capital= R/PMacroeconomics Chapter 6 20Constructing the Budget ConstraintInterest IncomeIf a households nominal bond holdings are B, the flow of nominal interest income received is iB per year.Since B equals zero for the

21、 whole economy, we have that the total of interest income equals zero.Macroeconomics Chapter 6 21Constructing the Budget ConstraintTotal income Household nominal income= nominal profit + nominal wage income + nominal net rental income+ nominal interest incomeHousehold nominal income =+wL+(R/P)PK+iBM

22、acroeconomics Chapter 6 22Constructing the Budget ConstraintConsumptionHouseholds consume goods in the quantity C per year at price PHousehold nominal consumption= P CMacroeconomics Chapter 6 23Constructing the Budget ConstraintAssetsHouseholds hold assets in three forms: money, M; bonds, B; ownersh

23、ip of capital, K.Macroeconomics Chapter 6 24Constructing the Budget ConstraintAssetsWe assume that households hold a fixed amount of money in dollar terms; that is, we assume that the change over time of a households nominal money holdings is zeroM=0Macroeconomics Chapter 6 25Constructing the Budget

24、 ConstraintAssetsIn considering whether to hold assets as bonds or capital, households would compare the rate of return on bonds, the interest rate, i, with the rate of return on ownership of capital, R/P .Rate of return on bonds= rate of return on ownershipi = R/P Macroeconomics Chapter 6 26Constru

25、cting the Budget ConstraintHousehold nominal income = + wL + i ( B+ PK )Macroeconomics Chapter 6 27Constructing the Budget ConstraintHousehold Budget Constraintnominal value of assets= M+ B+ P Knominal saving to be the change over time in the nominal value of assets.nominal saving= (nominal assets)

26、= M + B + PKMacroeconomics Chapter 6 28Constructing the Budget ConstraintHousehold Budget Constraintnominal saving= nominal income nominal consumptionnominal saving= + wL + i ( B+ P K ) P C B + P K = + wL + i( B+ PK)PCMacroeconomics Chapter 6 29Constructing the Budget ConstraintHousehold Budget Cons

27、traint in Nominal TermsPC + B + PK = + wL + i( B+ PK )nominal consumption + nominal saving = nominal incomeMacroeconomics Chapter 6 30Constructing the Budget ConstraintHousehold Budget Constraint real termsC + (1/P)B+ K = /P + (w/P)L + i(B/P+K)consumption + real saving = real incomeMacroeconomics Ch

28、apter 6 31Constructing the Budget ConstraintMacroeconomics Chapter 6 32Clearing of the Markets for Labor and Capital ServicesProfit MaximizationReal Profit/P = AF(Kd,Ld) (w/P) Ld (R/P) Kdreal profit= output real wage payments real rental paymentsMacroeconomics Chapter 6 33Clearing of the Markets for

29、 Labor and Capital ServicesMacroeconomics Chapter 6 34Clearing of the Markets for Labor and Capital ServicesThe Labor MarketDemand for labor(/P) = AF( Kd, Ld) w/P = MPL w/Pchange in real profit= marginal product of labor real wage rateMacroeconomics Chapter 6 35Clearing of the Markets for Labor and

30、Capital ServicesMacroeconomics Chapter 6 36Clearing of the Markets for Labor and Capital ServicesSupply of laborWe are assuming that each household supplies a fixed quantity of labor to the labor market. Therefore, the aggregate or market supply of labor, Ls, is the given amount L.Macroeconomics Cha

31、pter 6 37Clearing of the Markets for Labor and Capital ServicesClearing of the labor marketw/P is determined to equate the aggregate quantity of labor demanded, Ld, to the aggregate quantity supplied, L.(w/P)* = MPL ( evaluated at L)Macroeconomics Chapter 6 38Clearing of the Markets for Labor and Ca

32、pital ServicesMacroeconomics Chapter 6 39Clearing of the Markets for Labor and Capital ServicesThe Market for Capital ServicesDemand for capital services(/P) = AF(Kd, Ld) R/P = MPK R/Pchange in real profit= marginal product of capital real rental priceMacroeconomics Chapter 6 40Clearing of the Marke

33、ts for Labor and Capital ServicesMacroeconomics Chapter 6 41Clearing of the Markets for Labor and Capital ServicesThe Market for Capital ServicesSupply of capital services For the economy as a whole, the aggregate quantity of capital, K, is given from past flows of investment. In the short run, the aggregate or market quantity of c