Week 7, Oct. 16 From the micro to the macro: GDP

 Readings for Friday Oct. 16, in “The Economics Book” about Macroeconomics and GDP (PIB)

• The economy can be counted, p. 36, Location 644
• Money and goods flow between producers and consumers, p. 40, Location 735-837
• The aim is to maximize happiness, not income, p. 216, Location 4161-4236
• "Has GDP outgrown its use?" from the Financial Times.
• Confused about GDP? Watch this video for an explanation of the circular flow of money in GDP. 
  

Exercise 4: This is a group exercise. WORK IN THE SAME GROUPS YOU WERE IN BEFORE. It is designed to have you analyze several key economic indicators of any country you choose. Download this document and fill it out. Upload your spreadsheet or PDF in Attach Files below. Deadline is Friday, Oct. 23, before class.  Can't find the data? Here are some authoritative sources.

 Suggestions for Exercise 4: Some countries report numbers for inflation, unemployment, and central bank interest rates by yearly average, by quarter, or by month. Annual average is preferred, but use what's available. Be consistent.

 Readings for Monday Oct. 19  

1. "World Happiness Report, 2018", Read p. 17, the predictors of happiness; pp. 20-21, Finland is the happiest country, and where does your country rank; pp. 25-27, U.S. and Spain's happiness declined, but Venezuela the most; pp. 114-115, why are Latin Americans so darn happy?

2. From "The Economics Book".

p. 196 Government should do nothing but control the money supply. Location 3727
p. 202 The more people work, the higher their bills. Inflation. Location 3834

3. Mandel, Chapter 12, Monetary policy, on ADI.

You might like . . .

The Indicator podcast  "The Fed's sweet spot for interest rates" (transcript here) is a really good explainer on monetary policy, how the central bank's policy on interest rates can stimulate the economy (which can cause inflation), or slow down the economy (when inflation is too strong.)