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Full-Text Articles in Macroeconomics

Appropriate Fiscal Policy Over The Business Cycle: Proper Stimulus Policies Can Work, Philip E. Graves Jan 2010

Appropriate Fiscal Policy Over The Business Cycle: Proper Stimulus Policies Can Work, Philip E. Graves

PHILIP E GRAVES

Fiscal policy has become quite controversial in the post-Keynesian era, the debate over the Obama stimulus package being a contentious recent example. Some pundits go so far as to take the position that macroeconomic theory has failed to meaningfully progress in terms of providing useful recommendations for policy-makers, particularly in times of recession. Others take the laissez-faire view that policy reactions to the business cycle do not help in a rational expectations world and indeed do harm by increasing uncertainty. Still others, while not necessarily viewing themselves as in any sense ―Keynesian,‖ have a nagging feeling that sometimes doing nothing ...


A Note On The Valuation Of Collective Goods: Overlooked Input Market Free Riding For Non-Individually Incrementable Goods, Philip E. Graves Jan 2009

A Note On The Valuation Of Collective Goods: Overlooked Input Market Free Riding For Non-Individually Incrementable Goods, Philip E. Graves

PHILIP E GRAVES

For at least fifty years economists have argued that vertically-aggregated marginal willingness to pay, when set equal to marginal provision cost, will result in optimal public good provision levels. This methodological approach would be expected to yield an exact analog, in terms of optimal levels of public good provision, to efficient provision of private goods in a perfect market setting. There is, however, a potentially serious flaw in the approach as actually practiced, since initial incomes are implicitly–and wrongly–taken to be optimal. From a given income, the output demand revelation problem has long been recognized–that there will ...


Voodoo Multipliers Revisited: Public Policy For Recessions And Boomtimes, Philip E. Graves Jan 2009

Voodoo Multipliers Revisited: Public Policy For Recessions And Boomtimes, Philip E. Graves

PHILIP E GRAVES

There is no abstract for this brief column.


Economic Growth And Business Cycles: The Labor Supply Decision With Two Types Of Technological Progress, Philip E. Graves Jan 2009

Economic Growth And Business Cycles: The Labor Supply Decision With Two Types Of Technological Progress, Philip E. Graves

PHILIP E GRAVES

An informal model is described that leads to multiple macroeconomic equilibria as a consequence of random variation in the relative amounts of technological change for new and existing goods. The novel observation is that the rate of introduction and market penetration of new goods vis-a-vis technological advance for existing goods importantly affects the labor supply decision. A relatively rapid influx of new goods will generally increase labor supply, while relatively more technological advance for existing goods will reduce labor supply to the market. These impacts are seen to provide insights into Rostow's stages of growth. Short run variations in ...


An Implementable Institutional Reform That Transfers Control Of Government Spending Levels From Politicians To Voters, Philip E. Graves Jan 2009

An Implementable Institutional Reform That Transfers Control Of Government Spending Levels From Politicians To Voters, Philip E. Graves

PHILIP E GRAVES

Elected representatives have little incentive to pursue the interests of those electing them once they are elected. This well-known principle-agent problem leads, in a variety of theories of government, to non-optimally large levels of government expenditure. An implication is that budgetary rules are seen as necessary to constrain politicians' tax and spending behavior. Popular among such constraints are various Balanced Budget Amendment proposals. These approaches, however, are shown here to have serious limitations, including failure to address the central concern of spending level. An alternative approach is advanced here that relies on a Coase-like mechanism that transfers control of government ...


Optimal Public Goods Provision: Implications Of Endogenizing The Labor/Leisure Choice, Nicholas E. Flores, Philip E. Graves Dec 2007

Optimal Public Goods Provision: Implications Of Endogenizing The Labor/Leisure Choice, Nicholas E. Flores, Philip E. Graves

PHILIP E GRAVES

Conventional analysis of public goods provision aggregates individual willingness to pay while treating income as exogenous, ignoring the fact that we generate income to allow us to purchase utility-generating goods. We explore the implications of endogenizing the lahor-leisure decision by explicitly considering leisure demand in a model of public goods provision. We consider benefit analysis of public goods provision and find that increments of the public good will generally be under-valued using conventional analysis while decrements to the public good (rare in public good settings) will be overvalued (JELC91,D61,Q5I)


I Don't Know, Philip E. Graves Jan 2003

I Don't Know, Philip E. Graves

PHILIP E GRAVES

This is a non-fiction novel, titled I Don't Know. I is in three parts, the first economic (which will seem "liberal" to most), the second political (which will seem "conservative" to most), and the third theological (which will seem weird to most). I think you will find it a fun read, and feel free to distribute it at will.


Amenities And The Labor Earnings Function, Philip E. Graves, Robert L. Sexton Jan 1999

Amenities And The Labor Earnings Function, Philip E. Graves, Robert L. Sexton

PHILIP E GRAVES

Desirable locations are, other things equal, expected to be characterized by a mix of higher rents or lower wages. That is, if one area is more attractive than others, inmigration would occur, driving up the demand for land (hence raising rents) and increasing the supply of labor (hence lowering wages). The in-movement will continue until utility is the same across locations in equilibrium. Failing to hold constant amenities in the traditional earnings functions employed by labor economists will result, then, in omitted-variable bias if worker characteristics (years of schooling, union membership, and so on) are correlated with amenities. By way ...


Amenities And Fringe Benefits: Omitted Variable Bias, Philip E. Graves, Robert L. Sexton, Michelle M. Arthur Jan 1999

Amenities And Fringe Benefits: Omitted Variable Bias, Philip E. Graves, Robert L. Sexton, Michelle M. Arthur

PHILIP E GRAVES

If labor is fairly mobile, as it is in the United States, one would expect that households would move from less desirable areas toward more desirable areas until all areas are equally desirable. The way that areas become equally desirable is through the impact of movers on wages and rents (and possibly "endogenous" disamenities, such as congestion or pollution). That is, as people move to desirable areas, they will increase the demand for land (raising rents) and increase the supply of labor (lowering wages); in equilibrium, the wage and rent "compensation" for the niceness of an area reveals, in dollar ...


The Robustness Of Hedonic Price Estimation, Philip E. Graves, James C. Murdoch, Mark A. Thayer, Donald M. Waldman Jan 1988

The Robustness Of Hedonic Price Estimation, Philip E. Graves, James C. Murdoch, Mark A. Thayer, Donald M. Waldman

PHILIP E GRAVES

There is no abstract for this article; it begins with the Introduction.


Economics Departmental Rankings: Research Incentives, Constraints, And Efficiency, Philip E. Graves, James R. Marchand, Randall Thompson Jan 1982

Economics Departmental Rankings: Research Incentives, Constraints, And Efficiency, Philip E. Graves, James R. Marchand, Randall Thompson

PHILIP E GRAVES

There is no abstract for this article; it begins with the Introduction.


Morbidity And Pollution, Ronald J. Krumm, Philip E. Graves Jan 1982

Morbidity And Pollution, Ronald J. Krumm, Philip E. Graves

PHILIP E GRAVES

Time-series analysis of effects of pollutants on emergency hospital admissions indicates important synergistic interactions among pollutants and to a lesser degree nonlinearities in effects of single pollutants. Comparisons of alternative econometric specifications are made to determine the appropriateness of incorporating nonuniform pollution impacts. The data substantially support the existence of synergisms among pollutants with high levels of sulfur dioxide, SO, (particulates), increasing the impact of particulates (SO,) on emergency hospital admissions. Marginal effects of either pollutant are, however, small at current ambient air quality levels. These results indicate that damage estimates were likely to be understated during the 1960’s ...


Rural To Urban Migration: Population Distribution Patterns 19, Philip E. Graves Jan 1981

Rural To Urban Migration: Population Distribution Patterns 19, Philip E. Graves

PHILIP E GRAVES

The abstract would be exactly the same as the introduction to the paper, and need not be repeated here.


The Velocity Of Money: Evidence For The U.K. 1911-1966, Philip E. Graves Jan 1980

The Velocity Of Money: Evidence For The U.K. 1911-1966, Philip E. Graves

PHILIP E GRAVES

This paper presents secular evidence on the income velocity of money, exploring the issue of the superiority of money balances. Under a variety of specifications and statistical techniques, employed on both traditional and non-traditional variables, the Friedman assertion that money is a superior good is found to lack empirical support. Indeed, income elasticities of demand for M2 balances of .3 to .45 are observed, elasticities much smaller than previously thought.


New Evidence On Income And The Velocity Of Money, Philip E. Graves Jan 1978

New Evidence On Income And The Velocity Of Money, Philip E. Graves

PHILIP E GRAVES

Time series and cross-country empirical results suggest that cash holding as a proportion of income rises, or equivalently that velocity falls, as income increases. Numerous cross-sectional findings at many points in time, in several countries, conclude oppositely. It is argued here that the former studies suffer from omitted variable bias by ignoring socio-demographic variables affecting the demand for cash balances. When one incorporates such demand shifters into the analysis the time series and cross-country findings are seen as consistent with the critically reexamined cross-sectional result that velocity increases with income.


Wealth And Cash Asset Proportions, Philip E. Graves Jan 1976

Wealth And Cash Asset Proportions, Philip E. Graves

PHILIP E GRAVES

This paper has no abstract.