Principles of Macroeconomics (Video)

As we've covered previously, the aggregate-demand aggregate-supply model is a useful tool for helping us understand what's going on in an economy. But it can get pretty complicated.

In this video, we're going to take a look at the following real-world...

We’re going to explore the mechanics of the aggregate-demand aggregate-supply (AD-AS) model. In our example, we’ll measure the economy’s inflation rate as well as the real GDP growth rate on the vertical and horizontal axes.

A country’s normal GDP growth...

There’s an old analogy about blind men grasping an elephant.

Elephants are huge creatures. If you’re touching the trunk, but you can’t see the whole elephant, you’re going to have a very different perspective from someone touching a leg. It doesn’t mean...

The Austrian school of economic thought emphasizes market price signals and how they communicate decentralized information in an economy. The Austrian business cycle theory focuses on how central banks can distort those price signals.

When central banks...

So far in our business cycles deep dive, we’ve covered two of the four main theories: Keynesian and monetarist. Now, we’re going to move away from aggregate demand and monetary policy to check out the supply side of things in real business cycle (RBC)...

Meet the monetarists! This business cycle theory emphasizes the effect of the money supply and the central bank on the economy. Formulated by Nobel Laureate Milton Friedman, it’s a “goldilocks” theory that argues for a steady rate of fairly low inflation...

One point of contention among economists is the causes of business cycles and recessions. And if you disagree on the causes, chances are that you disagree on the solutions.

In this video series, we’re going to explore some of the major business cycle...

Effective fiscal policy has to be timely, targeted, and temporary. But how the central bank, businesses, and consumers respond to fiscal policy also plays a role in how effective it is.

When expansionary fiscal policy is enacted, what happens to the...

In response to the 2008 financial crisis, the Fed employed some new instruments and approaches to getting the economy back on track. In this video we explore three of these: quantitative easing, paying interest on reserves, and conducting repurchase (and...

In the United States, the Federal Reserve controls the supply of money. This makes it a pretty massive player in the US – and world – economy.

The Fed can use the money supply and interest as tools to influence aggregate demand. But how the Fed does this...