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eBook Monetary Economics: An Integrated Approach to Credit, Money, Income, Production and Wealth download

by W. Godley,M. Lavoie

eBook Monetary Economics: An Integrated Approach to Credit, Money, Income, Production and Wealth download ISBN: 0230301843
Author: W. Godley,M. Lavoie
Publisher: Palgrave Macmillan; 2nd ed. 2012 edition (March 27, 2012)
Language: English
Pages: 530
ePub: 1335 kb
Fb2: 1368 kb
Rating: 4.7
Other formats: lrf azw doc mobi
Category: Different
Subcategory: Business and Finance

Monetary Economics: An I. .has been added to your Cart. The first 300 or so pages of the book develop the individual building blocks of G&L's approach, which are then put together to form surprisingly realistic models in chapters 10-12.

Monetary Economics: An I. These models explicitly describe the interaction of the real and financial sides of the economy. The behavior of the financial institutions (especially the central bank) ends up playing a key role in determining the dynamics of the system as a whole.

Wynne Godley and Marc Lavoie. From the same authors: Wynne Godley. Macroeconomics (with Francis Cripps) (Oxford: Oxford University Press) 1983.

by Marc Lavoie & Wynne Godley. create flows of income, expenditure and production together with stocks of assets (including money. they did it in Money Won't Make You Rich, a comprehensive guide to true prosperity and financial freedom. The Miracle Morning: The Not-So-Obvious Secret Guaranteed to Transform Your Life. 15 MB·163,600 Downloads.

Godley . Lavoie M. This book challenges the mainstream paradigm, which is based on the inter-temporal optimisation of welfare by individual agents

Godley . This book challenges the mainstream paradigm, which is based on the inter-temporal optimisation of welfare by individual agents. It introduces a new methodology for studying how it is institutions which create flows of income, expenditure and production together with stocks of assets (including money) and liabilities, thereby determining how whole economies evolve through time. Starting with extremely simple stock flow consistent (SFC) models, the text describes a succession of increasingly complex models.

WYNNE GODLEY was formerly Director of the Department of Applied Economics at the University of Cambridge, UK, from 1970 to 1994, and subsequently a Professor of Applied Economics. During this period, from 1987-1988, he was also a Visiting Professor at University of Aalborg, Denmark. Between 1994 and 2001, Professor Godley was a Distinguished Scholar at the Levy Economics Institute of Bard College, New York.

This book challenges the mainstream paradigm, based on the inter-temporal optimisation of welfare by individual agents. It introduces a methodology for studying how institutions create flows of income, expenditure and production together with stocks. It introduces a methodology for studying how institutions create flows of income, expenditure and production together with stocks of assets and liabilities, thereby determining how whole economies evolve through time.

Monetary economics is the branch of economics that studies the different competing theories of money: it.Wynne Godley and Marc Lavoie, 2007.

Wynne Godley and Marc Lavoie, 2007.

This book challenges the mainstream paradigm, which is based on the inter-temporal optimisation of welfare by.

This book challenges the mainstream paradigm, which is based on the inter-temporal optimisation of welfare by individual agents. Starting with extremely simple stock flow consistent (SFC) models, the text describes a succession of increasingly complex models

Monetary Economics book. Goodreads helps you keep track of books you want to read.

Monetary Economics book.

This book challenges the mainstream paradigm, based on the inter-temporal optimisation of welfare by individual agents. It introduces a methodology for studying how institutions create flows of income, expenditure and production together with stocks of assets and liabilities, thereby determining how whole economies evolve through time.
Comments: (7)
Hasirri
In this book, the authors develop a new and powerful methodology for macroeconomic modeling, based on a Kaleckian view of how things work. In the models, as in the real world, flow variables (like personal income) generate changes in stock variables (like personal wealth). A distinctive feature of Godley and Lavoie's models is that all relevant stock and flow variables are explicitly accounted for, so that they fit together as a complete system. This approach is in contrast to the partial equilibrium methods that are commonly used in economics, which allow some variables to change while others are ignored or assumed to remain constant. Godley and Lavoie (henceforth, G&L) convincingly argue that the partial equilibrium approach is logically incoherent and generates incorrect results. Of course, their alternative methodology, in which the dynamics of all stock and flow variables are fully accounted for, gives rise to much more complicated models (one of the models in Monetary Economics has over 100 equations). But by using computer simulations, one is able to get an understanding of the models and the properties of their solutions.

The first 300 or so pages of the book develop the individual building blocks of G&L's approach, which are then put together to form surprisingly realistic models in chapters 10-12. These models explicitly describe the interaction of the real and financial sides of the economy. The behavior of the financial institutions (especially the central bank) ends up playing a key role in determining the dynamics of the system as a whole.

Anyone who gives serious thought to the arguments in this book will probably want to challenge certain points, revise certain assumptions, and add features of the real world that the models ignore. But the aim of the book, I believe, is not to promote any one particular model, but rather to introduce and argue for a certain modeling *methodology*. (And judged on those terms, I would say the book is very successful). Nevertheless, there are still some specific propositions established by Godley and Lavoie which are interesting in their own right, and which are likely to survive reasonable revisions to G&L's models. The most important of these is: in modern capitalist economies there is no mechanism in place to automatically drive output toward its full employment level, even in the long run; to achieve full employment, active fiscal and monetary policy is required. Connected with this, the book provides a timely argument against the austerity policies that have been implemented in the US and Europe over the past few years.

In addition, in chapter 11 there are a some interesting results which are related to financialization. First, it is shown that if there is an increase in the ratio of consumer loans to income, this will stimulate aggregate demand in the short run, but diminish it in the long run. As G&L write, this "has interesting repercussions for the evolution of many OECD countries, most notably the United States and Canada, where aggregate demand over the last ten years or so has been sustained by a continuous expansion in the personal debt of households relative to their personal income." Second, G&L show that, in their model, if firms decide to finance a higher proportion of their investment through retained earnings rather than issuance of new equities, then this will also cause aggregate demand to diminish. This potentially sheds some light on the poor macroeconomic performance of the US over the past few decades, where the process of financialization (specifically the "shareholder value movement") has induced firms to finance a larger share of their investments with internal funds. There are many other insights like this scattered all over the book.

There is one last point I wanted to make about the book: if you are willing to learn a little bit of math and a little bit of computer programming, then you can simulate the models in this book (and recreate Godley and Lavoie's results) on your computer without buying any software. Here is what you do. In each model, the the vector x of values of the variables in any given period will satisfy an equation of the form F(x,y) = x, where y is a vector of values from previous periods. Since, in any given period, y is given by the past history of the model, this is a fixed point problem. In all of the models I have tried to simulate so far, this fixed point problem can be solved using a very simple and well-known numerical method called the "fixed point iteration". Using this idea, it is possible to write C programs that generate solutions to the models. To get the specific parameters values used by Godley and Lavoie in their simulations, go to the website referenced in the text (see footnote 24 on the bottom of page 19). I have recreated most of the simulations from chapter 10 using this technique. (I would be happy to share my code if you want to email me -- my contact information is on my amazon profile.)
Lynnak
I very important book which brings to the heterodox branch of economics an unified view of post-keynesian perspective and tobinian approach to consistent stock and flow analitical tools for empirical analysis of the macroeconomic system as whole. Godley was one of the most important developers of this method, and writes about it in clear fashion. Great book for economists which wants to study but highly hypothetical, mathematical abstract models. It is the macroeconomic real world as it looks like. There is a lot of math inside, but it is not an abstract exercise without practical purpose.
Chankane
If you are taking a course in Economics at any school, check whether their models are stock-flow consistency. Most of the mainstream economics is not stock-flow consistent. In fact, one of the test of the mainstream theories to check for their stock-flow consistency. If they are not constistent, just run away: alas, that's not how the world runs. If you want a gig at Goldman Sachs, you should get a degree from HYP (harvard, yale, princeton) or Berkely, etc. If you go to the latter set of places, you have been taught stuff that are not stock flow consistent.

Idealization and concretization are two concepts heavily used in philosophy of Economics ( I remember it from Leszek Nowak's works). This book starts with a simple model, which is stock-flow consistent. Call this simple model, an ideal model. Then bring in more complexity, which leads to concrete models which are stock flow consistent.

Basically, this book teaches how to do macro economics in a systematic fashion, and in a scientific way.
Capella
This book was defintely written for academic economists, it has some great incites into how the economy really works as opposed to the theories of the dominant neo- classical school.

Working in the investment industry we have largely dismissed any advice and forecasts from economists as joke due to its lack of correlation with the stock market and the real economy. This book gives some hope for the dismal science of economics dominated by the neo classicl school.

It would be great if Marc could write a book on how the economy actually works based on stock flow consistency targeted towards those not as highly trained individuals in economics such as fund managers, retail investors and businesses seeking more accuracy around forecasting the economy.

There are great gems in this book, but you have to read the book very closely to pick them up.
sunrise bird
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Windforge
A different take on macroeconomics, long overdue.
Nidora
I was impressed by the academic rigor in the stock-flow approach for advanced macroeconomics course that I teach at the University of El Salvador
Just got the book, so can not provide an accurate review, but they required one anyway, so I had to do so. My complaint is that I was hoping that when it said:

"Readers will be able to download all the models and explore their properties for themselves."

that I could access the models. However, access is to models which are only compatible with a $1000+ program, called eviews. Very misleading!