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assign10 - Intro Macro ASSIGNMENT 10 N. Sheflin NOTES:...

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I n t r o M a c r o N . S h e f l i n ASSIGNMENT 10 NOTES: Unemployment and Wages, and Review of the LR Classical Model and Sticky/Flexible wages (and prices). Some catchup and filling in of various topics. Investment Game – Catch up and round 3 – Mutual Funds. Advisement catch up HOW ARE YOU DOING (and what to do about it)? If you are doing poorly and feel you need more help, go to one of the Learning Resource Centers for tutoring ( http://lrc.rutgers.edu/ The student tutors are generally very good and can be most helpful. BRING QUESTIONS THAT ARE GIVING YOU TROUBLE – from homework and/or from big questions from the assignments. HAVE THE TUTOR SIGN THE QUESTION SHEET and show it to me for EXTRA CREDIT points. NOTES - KEY POINTS Unemployment Defining and Measuring unemployment and the unemployment rate o Structural, frictional and cyclical unemployment o Discouraged workers and hidden unemployment o Unemployment composition and duration o International comparisons and explanations Harm of unemployment o Economic o Social o Political The Natural Rate of unemployment – NAIRU o The ‘full-employment’ unemployment rate at which there is structural and frictional but not cyclical unemployment o The long-term unemployment rate at which inflation does not increase (i.e., there is no acceleration in prices – hence the non-accelerating inflation, rate of unemployment Unemployment Policies o Cyclical – stabilization (monetary/fiscal) policies o Structural – training, education, etc o Frictional – job search services etc. Okun’s Law o Change in unemployment rate = -½ (Actual GDP growth – 3%) ± i.e., unemployment rate moves opposite changes in gdp ± to keep unemployment rate from increasing, actual gdp must grow at 3% a year
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This note was uploaded on 02/05/2012 for the course 220 103 taught by Professor Sheflin during the Fall '09 term at Rutgers.

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assign10 - Intro Macro ASSIGNMENT 10 N. Sheflin NOTES:...

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