It is unfair, but true, that bad things happen. Unfortunately, to attempt to prevent unavoidable bad things can actually make things worse, not better. How might the above ideas be relevant to how society deals with business cycles? (Austrian)
Wesley Mitchell, a founder of Institutional economics, said that to understand the business cycle a distinction must be made between making goods and making money. All societies make goods. In the modern money economy, those who control the production and distribution of goods will only allow economic activity to occur if they can "make money." He used this line of reasoning to conclude that what drives the business cycle are business expectations; production, and thus increased employment today, will only be allowed if business expects to sell those goods at a profit tomorrow. Is his proposition reasonable? Explain. (Institutionalist)
Since the Great Depression, the United States has been able to avoid severe economic downturns.
What macroeconomic policies do you think have allowed us to avoid another Great Depression?
Would you classify those policies as being classical or Keynesian?
Are such policies still relevant today? (Post-Keynesian)
The text presents the target rate of unemployment as being about 5.5 percent. William Vickery, a Nobel-prizing-wining economist, argued that the target unemployment rate should be seen as being between 1 percent and 2 percent. Only an unemployment rate that low, he argued, would produce genuine full employment that guaranteed job openings for all those looking for work. Achieving a low unemployment rate would, according to Vickery, bring about "a major reduction in the illness of poverty, homelessness, sickness, and crime."
What is the appropriate target unemployment rate?
Explain your position.
What policies would you recommend to counteract the human tragedy of unemployment? (Radical)
Studies have shown that women tend to pay more than men for things such as auto repairs, haircuts, and dry cleaning.
Why do you think this is?
How does this fact affect the usefulness of aggregate statistics such as the Consumer Price Index (CPI)? (Feminist)
