tag:blogger.com,1999:blog-5362801348602268473.post1876365043299413440..comments2023-11-22T00:49:32.887-08:00Comments on Reflections on Monetary Economics: Productivity Growth and Trade: A ModelNick Edmondshttp://www.blogger.com/profile/15342983814699700396noreply@blogger.comBlogger9125tag:blogger.com,1999:blog-5362801348602268473.post-67519053543948791642020-10-15T05:31:38.920-07:002020-10-15T05:31:38.920-07:00This content is written very well. Your use of for...This content is written very well. Your use of formatting when making your points makes your observations very clear and easy to understand. Thank you. <a href="https://c4classifieds.com/uae/author/iq-option-login/" rel="nofollow">iq option login</a>SHAHZAIBhttps://www.blogger.com/profile/18016714975932207188noreply@blogger.comtag:blogger.com,1999:blog-5362801348602268473.post-9128117694625677902020-08-13T23:40:33.322-07:002020-08-13T23:40:33.322-07:00This is such a great resource that you are providi...This is such a great resource that you are providing and you give it away for free. <a href="https://www.gladedsolutions.com/post/loss-of-productivity-due-to-burnout" rel="nofollow">Productivity</a><br />rankseoexperthttps://www.blogger.com/profile/04509249724815744294noreply@blogger.comtag:blogger.com,1999:blog-5362801348602268473.post-4592732242705587832020-02-03T00:11:27.303-08:002020-02-03T00:11:27.303-08:00Rattling excellent info can be found on web b...Rattling excellent info can be found on web blog . <a href="https://www.instagram.com/portiaeconomics/" rel="nofollow">visit this site</a>MAYA KHANhttps://www.blogger.com/profile/10860156699420952853noreply@blogger.comtag:blogger.com,1999:blog-5362801348602268473.post-73548752787050774562016-10-30T02:38:58.372-07:002016-10-30T02:38:58.372-07:00And my reply:
1. Actually, it's probably unh...And my reply:<br /><br />1. Actually, it's probably unhelpful to refer to full employment, because what actually matters here is that labour utilisation is constant, rather than that it is equal to available labour. In terms if the equations, that simply means that I am holding LA and LB constant.<br /><br />2. By domestic prices, I mean the sale prices expressed in the currency of the seller.<br /><br />3. I'm not sure where I used this term and it doesn't mean much to me in isolation I'm afraid.<br /><br />4. I don't know how I can further define exchange rate. Here, it's the number of £ you would get in exchange for $1.<br /><br />I think I have divided the apple and banana markets into each country in that a distinct quantity of sales is determined for each country. I have assumed however that the same price applies in both countries (after translating at the exchange rate), because i have assumed simply mark-up pricing. I could instead have had sellers charge a different mark-up in each market. I chose not to do so to limit the number of equations and because I don't think it makes any difference to the point here.Nick Edmondshttps://www.blogger.com/profile/15342983814699700396noreply@blogger.comtag:blogger.com,1999:blog-5362801348602268473.post-7485499036522371132016-10-30T02:28:43.100-07:002016-10-30T02:28:43.100-07:00I'm not sure why your post is not showing, but...I'm not sure why your post is not showing, but I received notification of it, so I'm copying it as follows:<br /><br />"Well, I have indeed thought a lot more about your post. Thanks for sharing it, thanks for the provocative model.<br /><br />Because I usually think in a mechanical way, I like to break down problems into components. Here I am finding several definition components that have more than one solution or choice.<br /><br />1. Define "full employment". How for the haircut person? How between before and after banana productivity change?<br /><br />2. Define "domestic prices". In the post we assume a price relationship to unit labor cost. As you indicate, this would change as we varied productivity. It would also vary as we redefined "full employment".<br /><br />3. Define "price in productivity change". Here we have two choices: More output at same price or increased price per individual output unit. You used a combination of both (in the post) when you added the concept of "elasticity of substitution in demand". The choices we make here seem to affect our definition of "full employment".<br /><br />And 4. Define "exchange rate". You write "The £ / $ exchange rate floats to ensure that the value of exports equals the value of imports for each country. The labour supply is fixed and demand is managed to ensure continual full employment." We see that "exchange rate" is affected by our definition of "full employment".<br /><br />If you have read this far into my comment, you can see that I think the definition of "full employment" is critical to the discussion. Defining "full employment" is difficult, particularly if productivity changes. The case of the haircut person is a good example; the real world product is only needed (perhaps) once a month (requiring a few minutes of time) contrasted to apples which might be consumed once a day. What kind of labor units are we comparing?<br /><br />This (your post) is a great model but the choices required (seem to me) make a solution very assumption driven. Not to say that your result is wrong, but to say that other solutions are possible.<br /><br />One alternate option is to break the model into sub-sectors. Both apple and banana sectors can be broken into pound and dollar sectors. Then each sector can be modeled with the country of currency. Since these are the only portions of either economy that are traded using foreign exchange, the foreign exchange rate has a primary effect on these sectors. This sector division makes clear that consumer substitution-of-demand effects (and productivity changes) produce results that are sector concentrated.<br /><br />Thanks again for this post. Macroeconomics is a complicated study."Nick Edmondshttps://www.blogger.com/profile/15342983814699700396noreply@blogger.comtag:blogger.com,1999:blog-5362801348602268473.post-35375860654420263942016-10-29T10:34:44.658-07:002016-10-29T10:34:44.658-07:00Nick,
I wrote a long comment after spending a lot...Nick,<br /><br />I wrote a long comment after spending a lot of time studying your post -- and managed to vanish the text during posting. Not enough time to recreate that comment but here is an abbreviated version:<br /><br />It seems to me that the definition of "full employment" drives results. There seems to be no valid standard that relates time UNIVERSALLY to products produced. There seems to be only local standards.<br /><br />Without a definition of "full employment", we cannot define the effects of a productivity change. While we know full well that a productivity change does bring changes in the mix of employment distribution, we are at a loss to know exactly what those changes will be. As a result, we can only achieve assumption driven estimations.<br /><br />Thanks for sharing this model and thereby posing an intellectual tease. Macroeconomics is a difficult study.Roger Sparkshttps://www.blogger.com/profile/01734503500078064208noreply@blogger.comtag:blogger.com,1999:blog-5362801348602268473.post-37335146476776198662016-10-28T08:03:04.212-07:002016-10-28T08:03:04.212-07:00Thanks Nick. I will study the post further with th...Thanks Nick. I will study the post further with these comments in mind. Roger Sparkshttps://www.blogger.com/profile/01734503500078064208noreply@blogger.comtag:blogger.com,1999:blog-5362801348602268473.post-49096420503524769932016-10-28T04:11:17.520-07:002016-10-28T04:11:17.520-07:00Epsilon is the elasticity of demand. This gives t...Epsilon is the elasticity of demand. This gives the percentage change in quantity demanded divided by the percentage change in price, other things beng equal. Lambda is the pricing mark-up. Since only relative prices matter here and it applies to all prices, its value is irrelevant.<br /><br />I could add extra bits into the model to explain how domestic demand is determined, but it wouldn't add anything to the point here, so it's clearer if I leave it out and just assume that C is set at the required level.Nick Edmondshttps://www.blogger.com/profile/15342983814699700396noreply@blogger.comtag:blogger.com,1999:blog-5362801348602268473.post-38834994554392223312016-10-27T19:17:46.528-07:002016-10-27T19:17:46.528-07:00One of my current projects is to better understand...One of my current projects is to better understand foreign exchange. When I found this post, I read it with great interest. Hindering my progress, I thought I needed a much better understanding of the equations behind the graphs but I could not find a definition for -ε and λ. I also thought that equations 13 and 14 would give different values if the exchange rate was used to manage demand. And then I noticed that I needed to study "elasticity of substitution in demand" which I have only begun to do.<br /><br />Well, if both of these economies are "demand managed", it seems like there should be more factors, one of which would be controlled by a (presently) unnamed player(s).<br /><br />It also seems that if there are productivity gains, they should be shared by achieving greater production and consumption, which you seem to show. Another potential gain should be more leisure time but this option has been ruled out by assumption.<br /><br />To conclude, I like the model but find it incomplete in the sense that I cannot quickly replicate the graphs independently. Apparently, I just don't yet understand all the assumptions.Roger Sparkshttps://www.blogger.com/profile/01734503500078064208noreply@blogger.com