Curriculum Econ 101, Part 9: Macroeconomics Deep Dive
Econ 101, Part 9: Macroeconomics Deep Dive
The big ideas behind modern macroeconomics in plain words - IS-LM, liquidity traps, money velocity, the impossible trinity, rational expectations, sticky prices, hysteresis, secular stagnation and MMT.
- The IS-LM Model in Words How a classic model links the market for goods with the market for money to show how interest rates and output are determined together. 📄 Read-aloud
- The Liquidity Trap Why cutting interest rates may stop working when rates are near zero, and how Japan and other economies struggled with this problem. 📄 Read-aloud
- Money Demand and the Velocity of Money The quantity theory of money, what the velocity of money means, and why the simple link between money growth and inflation broke down in recent decades. 📄 Read-aloud
- The Impossible Trinity Why a country cannot simultaneously have a fixed exchange rate, free capital movement and an independent monetary policy, and how countries choose. 📄 Read-aloud
- Rational Expectations and the Lucas Critique How the idea that people form expectations using all available information transformed macroeconomics, and why Robert Lucas warned against relying on past patterns. 📄 Read-aloud
- Ricardian Equivalence The theory that government borrowing may not boost spending because people save to pay future taxes, and why real-world evidence is mixed. 📄 Read-aloud
- Econ 101, Part 9: Checkpoint 1 Quick checkpoint - five questions on IS-LM, liquidity traps, the velocity of money, the impossible trinity and Ricardian equivalence. 5 questions
- Sticky Prices and Menu Costs Why many prices and wages adjust slowly, and why this slow adjustment gives monetary policy real effects in the short run. 📄 Read-aloud
- Hysteresis: When Recessions Leave Scars How deep recessions can permanently lower an economy's output and employment by damaging skills, investment and workers' attachment to jobs. 📄 Read-aloud
- Secular Stagnation The theory that rich economies may suffer from chronically weak demand and very low interest rates, and the debate about whether it still applies. 📄 Read-aloud
- Real Business Cycles and DSGE Models How some economists explained booms and busts through technology shocks, and how today's central banks use large DSGE models. 📄 Read-aloud
- Modern Monetary Theory: The Debate What MMT claims about government spending and money creation, where mainstream economists agree and disagree, and why the debate matters. 📄 Read-aloud
- Putting It Together: The Macro Policy Toolkit A review of how the ideas in this module fit together to guide real decisions by central banks and governments facing recessions and inflation. 📄 Read-aloud