1、Overviewpart4Inthispartwewillstudyshort-termfluctuationsineconomicactivity,commonlyknownasrecessionsandexpansions.causeofshort-termfluctuationstheavailablepolicyresponses.Chapter 12:Short-Term Economic Fluctuations:An Introduction2Short-TermEconomic Fluctuations:An IntroductionChapter 12:Short-Term
2、Economic Fluctuations:An Introduction3Chapter Outline presents some background on the history characteristics of short-term economic fluctuations.Chapter 12:Short-Term Economic Fluctuations:An Introduction4Important Concepts Covered Recession/depression 衰退/萧条 Peak/trough 波峰/波谷 Expansion/boom 扩张/繁荣 P
3、otential output 生产能力 Output gap 产出缺口 Recessionary and expansionary gap 衰退型和扩张型产出缺口 Natural rate of unemployment 自然失业率 Okuns Law 奥肯法则Chapter 12:Short-Term Economic Fluctuations:An Introduction5.Recessions and Expansions Recession(or contraction)A period in which the economy is growing at a rate signi
4、ficantly below normal Depression A particularly severe or protracted recessionChapter 12:Short-Term Economic Fluctuations:An Introduction6 Peak The beginning of a recession,the high point of economic activity prior to a downturn Trough The end of a recession,the low point of economic activity prior
5、to a recoveryChapter 12:Short-Term Economic Fluctuations:An Introduction7 Expansion A period in which the economy is growing at a rate significantly above normal Boom A particularly strong and protracted expansionChapter 12:Short-Term Economic Fluctuations:An IntroductionSlide 8Chapter 12:Short-Term
6、 Economic Fluctuations:An IntroductionSlide 9Fluctuations in U.S.Real GDP,1920-2004Chapter 12:Short-Term Economic Fluctuations:An Introduction10U.S.Recessions Since 1929Peak date(beginning)Trough date(end)Duration(months)Highest unemployment rate(%)Change in real GDP(%)Duration of subsequent expansi
7、on(months)Aug.1929Mar.19334324.9-28.850May 1937June 19381319.0-5.580Feb.1945Oct.194583.9-8.537Nov.1948Oct.1949115.9-1.445July 1953May 1954105.5-1.239Aug.1957Apr.195886.8-1.724Apr.1960Feb.1961106.72.3106Dec.1969Nov.1970115.90.136Nov.1973Mar.1975168.5-1.158Jan.1980July 198067.6-0.312July 1981Nov.19821
8、69.7-2.192July 1990Mar.199187.5-0.9120Mar.2001Nov.2001 85.80.8Chapter 12:Short-Term Economic Fluctuations:An Introduction11.Some Facts About Short-term Economic Fluctuations Economic fluctuations are:Irregular in length and severity.Felt throughout the economy and may have a global effectChapter 12:
9、Short-Term Economic Fluctuations:An IntroductionSlide 12Real GDP Growth in Five Major Countries,1999-2004Chapter 12:Short-Term Economic Fluctuations:An Introduction13 Unemployment is a key indicator of short-term economic fluctuations.Industries that produce durable goods are more affected than nond
10、urable&service industries.Chapter 12:Short-Term Economic Fluctuations:An Introduction14 Recessions are usually followed by a decline in inflation and many have been preceded by an increase in inflation.Chapter 12:Short-Term Economic Fluctuations:An IntroductionSlide 15U.S.Inflation,1960-2004Chapter
11、12:Short-Term Economic Fluctuations:An Introduction16.Output Gaps andCyclical Unemployment Potential Output Output Gap The Natural Rate of Unemployment Okuns LawChapter 12:Short-Term Economic Fluctuations:An Introduction17 Potential Output,Y*(or potential real GDP or full-employment output)The maxim
12、um sustainable amount of output(real GDP)that an economy can produceChapter 12:Short-Term Economic Fluctuations:An Introduction18 Output Gap Y*(potential output)-Y(actual output)The difference between the economys potential output and its actual output at a point in timeChapter 12:Short-Term Economi
13、c Fluctuations:An Introduction19 Recessionary GapY*YA positive output gap,which occurs when potential output exceeds actual outputCapital and labor resources are not fully utilizedOutput and employment are below normal levelsChapter 12:Short-Term Economic Fluctuations:An Introduction20 Expansionary
14、Gap Y Y*A negative output gap,which occurs when actual output is higher than potential output Higher output and employment than normal Demand for goods exceed the capacity to produce them and prices rise High inflation reduces economic efficiencyChapter 12:Short-Term Economic Fluctuations:An Introdu
15、ction21 The Natural Rate of Unemployment and Cyclical Unemployment Recessionary gaps are characterized by high unemployment.Expansionary gaps are characterized by unusually low unemployment.Chapter 12:Short-Term Economic Fluctuations:An Introduction22Types of unemployment(revisited)Frictional Struct
16、ural CyclicalChapter 12:Short-Term Economic Fluctuations:An Introduction23 The Natural Rate of Unemployment and Cyclical Unemployment Natural rate of unemployment,u*Attributable to frictional and structural unemployment Cyclical unemployment equals zero No recessionary or expansionary gap Cyclical u
17、nemployment =u-u*total unemployment=natural rateChapter 12:Short-Term Economic Fluctuations:An Introduction24 During recessionary gaps:u u*and cyclical unemployment is positive During expansionary gaps:u u*and cyclical unemployment is negativeChapter 12:Short-Term Economic Fluctuations:An Introducti
18、on25 Okuns LawEach extra percentage point of cyclical unemployment is associated with about a 2 percentage point increase in the output gap,measured in relation to potential outputChapter 12:Short-Term Economic Fluctuations:An Introduction26 Okuns Law (Y-Y*)/Y*=-a(u-u*)Chapter 12:Short-Term Economic
19、 Fluctuations:An IntroductionSlide 27Okuns Law and the Output Gap in the U.S.EconomyYearuu*Y*19829.7%6.1%5,58419916.85.87,30519984.55.28,95020025.85.210,3421982 u-u*=cyclical unemployment 9.7-6.1=3.6%Output gap=2 x 3.6=7.2%Output gap=5,584 x.072 =$402 billion 1991 6.8-5.8=1%Output gap=7,305 x.02=$14
20、6 billionChapter 12:Short-Term Economic Fluctuations:An IntroductionSlide 28Okuns Law and the Output Gap in the U.S.EconomyYearuu*Y*19829.7%6.1%5,58419916.85.87,30519984.55.28,95020025.85.210,3421998 4.5-5.2=-0.7 Output gap=8,563 x-.014 =-$120 billion2002 5.8-5.2=0.6 Output gap=10,342 x.012 =$124 bi
21、llionChapter 12:Short-Term Economic Fluctuations:An Introduction29 Okuns Law The 1982 output gap per capita$402 billion/230 million=$1,748 for a family of four In 2000 dollars it equals$7,000 for a family of fourChapter 12:Short-Term Economic Fluctuations:An Introduction30.Why Do Short-Term Fluctuat
22、ions Occur?A Preview and a ParableWhy Do Short-Term Fluctuations Occur?l Prices may not adjust in the short-run and firms adjust output to meet demand.1.When firms meet demand at preset prices,changes in economywide spending are the primary cause of output gaps.Chapter 12:Short-Term Economic Fluctuations:An Introduction31l Firms will eventually adjust prices to eliminate output gaps.l In the long-run,output is determined by productive capacity and spending influences only inflation.Chapter 12:Short-Term Economic Fluctuations:An Introduction32End ofChapter
