宏观经济学---曼昆02

1、The Data of MacroeconomicsChapter 22014 Economics and Management School, Wuhan UniversityCHAPTER 2 The Data of MacroeconomicsIn this chapter, you will learnthe meaning and measurement of the most important macroeconomic statistics:mGross Domestic Product (GDP)mThe Consumer Price Index (CPI)mThe unem

2、ployment ratemEconomists use these statistics to study the economy; policymakers use them to monitor development and formulate policies.Gross Domestic ProductlGDP is often considered the best measure of how well the economy is performing; l- summarize in a single number the dollar value of economic

3、activity in a given period of time.CHAPTER 2 The Data of MacroeconomicsCHAPTER 2 The Data of MacroeconomicsGross Domestic Product: Expenditure and IncomeTwo definitions:mTotal expenditure on domestically-produced final goods and services.mTotal income earned by domestically-located factors of produc

4、tion. Expenditure equals income because every dollar spent by a buyer becomes income to the seller. National Income AccountinglTo understand the meaning of GDP more fully, we turn to national income accounting, the accounting system used to measure GDP and many related statistics.CHAPTER 2 The Data

5、of MacroeconomicsCHAPTER 2 The Data of MacroeconomicsThe Circular FlowHouseholdsFirmsGoodsLaborExpenditure ($)Income ($)Measurement of GDPlGDP measures the flow of dollars in the economy.lTotal income from the production of bread: - top half of the circular flowlTotal expenditure on purchases of bre

6、ad: - bottom half of the circular flowlTo compute GDP, we can look at either side of the flows. CHAPTER 2 The Data of MacroeconomicsCHAPTER 2 The Data of MacroeconomicsStocks vs. FlowsA flow is a quantity measured per unit of time. E.g., “U.S. investment was $2.5 trillion during 2006.”FlowStockA sto

7、ck is a quantity measured at a point in time. E.g., “The U.S. capital stock was $26 trillion on January 1, 2006.”CHAPTER 2 The Data of MacroeconomicsStocks vs. Flows - examplesthe govt budget deficitthe govt debt# of new college graduates this year# of people with college degreesa persons annual sav

8、inga persons wealthflowstockCHAPTER 2 The Data of MacroeconomicsNow you try: Stock or flow?lthe balance on your credit card statementlhow much you study economics outside of classlthe size of your compact disc collectionlthe inflation ratelthe unemployment rateCHAPTER 2 The Data of MacroeconomicsFin

9、al goods, value added, and GDPl GDP = value of final goods produced = sum of value added at all stages of production.l The value of the final goods already includes the value of the intermediate goods, so including intermediate and final goods in GDP would be double-counting. Rules for Computing GDP

10、lAdding apples and orangeslUsed goodslTreatment of inventorieslIntermediate goods and value addedlHousing services and other imputationsCHAPTER 2 The Data of MacroeconomicsAdding apples and orangeslTo compute the total value of different goods and services, NIA use market prices because these prices

11、 reflect how much people are willing to pay for a good or services. lGDP = (Price of Apples * Quantity of Apples) + (Price of Oranges * Quantity of Oranges)CHAPTER 2 The Data of MacroeconomicsUsed goodslGDP measures the value of currently produced goods and services. lThus, the sale of used goods re

12、flects the transfer of an asset, not an addition to the economys income; lThus, it is not included as part of GDP.CHAPTER 2 The Data of MacroeconomicsTreatment of inventoriesl A bakery hires workers to produce more bread, pays their wages, and then fail to sell the additional bread. What happens to

13、GDP?l Case1: The bread spoiled. l More wages and less profit. Total expenditure and income do not change. l Case2: The bread is put into inventory.l The firms are assumed to have “purchased” the bread for inventory. GDP rises. Later, inventory disinvestment occurs, which case is much like the sale o

14、f a used good.CHAPTER 2 The Data of MacroeconomicsIntermediate goods and value addedl Many goods are produced in stages. l GDP includes only the value of final goods. l To add the intermediate goods to the final goods would be double counting. l A firms value added is the value of its output less th

15、e value of the intermediate goods the firm used to produce that output. l GDP is also the total value added of all firms in the economy. CHAPTER 2 The Data of MacroeconomicsCHAPTER 2 The Data of MacroeconomicsExercise:mA farmer grows a bushel of wheat and sells it to a miller for $1.00. mThe miller

16、turns the wheat into flour and sells it to a baker for $3.00. mThe baker uses the flour to make a loaf of bread and sells it to an engineer for $6.00. mThe engineer eats the bread. Compute & compare value added at each stage of production and GDPHousing services and other imputationsl Some goods and

17、 services are not sold in the marketplace and do not have market prices. We must use an estimate of their value (imputed value)l Imputations are useful for determining the value of housing or government services. l In many cases, imputations are not made in practice. (ex, home-made meals, undergroun

18、d economy)l GDP is an imperfect measure of economic activity. CHAPTER 2 The Data of MacroeconomicsCHAPTER 2 The Data of MacroeconomicsReal vs. nominal GDPl GDP is the value of all final goods and services produced. l nominal GDP measures these values using current prices. l real GDP measure these va

19、lues using the prices of a base year(constant set of prices). l If all prices doubled without any change in quantities, GDP would double. Thus, nominal GDP would be misleading as a measure of economic well-being.CHAPTER 2 The Data of MacroeconomicsPractice problem, part 1l Compute nominal GDP in eac

20、h year.l Compute real GDP in each year using 2006 as the base year.200620072008PQPQPQgood A$30900$311,000$361,050good B$100192$102200$100205CHAPTER 2 The Data of MacroeconomicsAnswers to practice problem, part 1nominal GDP multiply Ps & Qs from same year2006: $46,200 = $30 900 + $100 192 2007: $51,4

21、00 2008: $58,300real GDP multiply each years Qs by 2006 Ps2006: $46,2002007: $50,000 2008: $52,000 = $30 1050 + $100 205lBecause the prices are held constant, real GDP varies from year to year only if the quantities produced vary. lBecause a societys ability to provide economic satisfaction for its

22、members ultimately depends on the quantities of goods and services produced, real GDP provides a better measure of economic well-being than nominal GDP.CHAPTER 2 The Data of MacroeconomicsCHAPTER 2 The Data of MacroeconomicsReal GDP controls for inflationChanges in nominal GDP can be due to:mchanges

23、 in prices. mchanges in quantities of output produced.Changes in real GDP can only be due to changes in quantities,because real GDP is constructed using constant base-year prices. CHAPTER 2 The Data of MacroeconomicsU.S. Nominal and Real GDP, 19502006Nominal GDPReal GDP(in 2000 dollars)CHAPTER 2 The

24、 Data of MacroeconomicsGDP DeflatorlThe inflation rate is the percentage increase in the overall level of prices.lOne measure of the price level is the GDP deflator (implicit price deflator for GDP), defined asNominal GDPGDP deflator = 100Real GDPCHAPTER 2 The Data of MacroeconomicsPractice problem,

25、 part 2l Use your previous answers to compute the GDP deflator in each year. l Use GDP deflator to compute the inflation rate from 2006 to 2007, and from 2007 to 2008. Nom. GDPReal GDPGDP deflatorInflationrate2006$46,200$46,200n.a.200751,40050,000200858,30052,000CHAPTER 2 The Data of MacroeconomicsA

26、nswers to practice problem, part 2Nominal GDPReal GDPGDP deflatorInflationrate2006$46,200$46,200100.0n.a.200751,40050,000102.82.8%200858,30052,000112.19.1%CHAPTER 2 The Data of MacroeconomicsChain-Weighted Real GDPlOver time, relative prices change, so the base year should be updated periodically.lI

27、n essence, chain-weighted real GDP updates the base year every year, so it is more accurate than constant-price GDP.lYour textbook usually uses constant-price real GDP, because: mthe two measures are highly correlated.mconstant-price real GDP is easier to compute.CHAPTER 2 The Data of Macroeconomics

28、Two arithmetic tricks for working with percentage changesEX:If your hourly wage rises 5% and you work 7% more hours, then your wage income rises approximately 12%.1. For any variables X and Y, percentage change in (X Y ) percentage change in X + percentage change in YCHAPTER 2 The Data of Macroecono

29、micsTwo arithmetic tricks for working with percentage changesEX: GDP deflator = 100 NGDP/RGDP.If NGDP rises 9% and RGDP rises 4%, then the inflation rate is approximately 5%.2. percentage change in (X/Y ) percentage change in X percentage change in YCHAPTER 2 The Data of MacroeconomicsThe expenditur

30、e components of GDPlAllocation of the output among alternative uses.lConsumption (C)lInvestment (I)lGovernment spending (G)lNet exports (NX)CHAPTER 2 The Data of MacroeconomicsNational Income Account IdentityY = C + I + G + NXaggregate expenditurevalue of total outputCHAPTER 2 The Data of Macroecono

31、micsConsumption (C)mdurable goods last a long time ex: cars, home appliancesmnondurable goodslast a short time ex: food, clothingmserviceswork done for consumers ex: dry cleaning, air travel.definition: The value of all goods and services bought by households. Includes:CHAPTER 2 The Data of Macroeco

32、nomicsU.S. consumption, 201047.2215.8510.6070.53%6,8592,3021,08610,246 Services Nondurables DurablesConsumption% of GDP$ billionsCHAPTER 2 The Data of MacroeconomicsInvestment (I)Definition 1: Spending on the factor of production capital.Definition 2: Spending on goods bought for future useIncludes:

33、mNoresidential fixed investmentSpending on plant and equipment that firms will use to produce other goods & services.mresidential fixed investmentSpending on housing units by consumers and landlords.minventory investmentThe change in the value of all firms inventories.CHAPTER 2 The Data of Macroecon

34、omicsU.S. investment, 20100.462.339.5712.36%673381,3901,795 Inventory Residential fixedNoresidential fixedInvestment% of GDP$ billionsCHAPTER 2 The Data of MacroeconomicsInvestment vs. CapitalNote: Investment is spending on new capital.Example (assumes no depreciation): m1/1/2006: economy has $500b

35、worth of capitalmduring 2006:investment = $60bm1/1/2007: economy will have $560b worth of capitalCHAPTER 2 The Data of MacroeconomicsGovernment spending (G)l G includes all government spending on goods and services.l G excludes transfer payments (e.g., unemployment insurance payments), because they

36、do not represent spending on goods and services. CHAPTER 2 The Data of MacroeconomicsU.S. government spending, 2010Federal20.67%3,003Govt spendingState & localDefense8.4212.255.642.781,2231,780819404Non-defense% of GDP$ billionsNet exports: NX = EX IMdef: The value of total exports (EX) minus the va

37、lue of total imports (IM).CHAPTER 2 The Data of MacroeconomicsGDP: An important and versatile conceptWe have now seen that GDP measuresmtotal incomemtotal outputmtotal expendituremthe sum of value-added at all stages in the production of final goodsCHAPTER 2 The Data of MacroeconomicsGNP vs. GDPlGro

38、ss National Product (GNP): Total income earned by the nations factors of production, regardless of where located.lGross Domestic Product (GDP):Total income earned by domestically-located factors of production, regardless of nationality.(GNP GDP) = (factor payments from abroad) (factor payments to ab

39、road)CHAPTER 2 The Data of MacroeconomicsDiscussion question:In your country, which would you want to be bigger, GDP, or GNP? Why?CHAPTER 2 The Data of Macroeconomics(GNP GDP) as a percentage of GDP selected countries, 2002Other Measures of IncomelNet National Produce =GNP-DepreciationlNational Inco

40、me = NNP Indirect Business Taxesl = Compensation of employeesl+Proprietors Incomel+ Rental Income + Corporate Profitsl+Net InterestCHAPTER 2 The Data of MacroeconomicslPersonal Income = National Incomel - Corporate Profitsl - Social Insurance Contributionsl - Net Interestl + Dividendsl + Government

41、Transfers to Individualsl + Personal Interest IncomeCHAPTER 2 The Data of MacroeconomicslDisposable Personal Income = Personal Income Personal Tax and Nontax PaymentslWe are interested in disposable personal income because it is the amount households and noncorporate businesses have available to spe

42、nd after satisfying their tax obligations to the government. CHAPTER 2 The Data of MacroeconomicsSeasonal AdjustmentlWhen economists study fluctuations in real GDP and other economic variables, they often want to eliminate the portion of fluctuations due to predictable seasonal changes. lMost of the

43、 economic statistics reported in the newspaper are seasonally adjusted. CHAPTER 2 The Data of MacroeconomicsCHAPTER 2 The Data of MacroeconomicsConsumer Price Index (CPI)lInflation: increase in the overall level of priceslCPI: A measure of the overall level of prices lPublished by the Bureau of Labo

44、r Statistics (BLS) lUses: mtracks changes in the typical households cost of livingmallows comparisons of dollar amounts over timeCHAPTER 2 The Data of MacroeconomicsHow the BLS constructs the CPI1. Survey consumers to determine composition of the typical consumers “basket” of goods.2. Every month, c

45、ollect data on prices of all items in the basket; compute cost of basket3. CPI in any month equalsCost of basket in that monthCost of basket in base period100CHAPTER 2 The Data of MacroeconomicsExercise: Compute the CPIBasket contains 20 pizzas and 10 compact discs. prices:pizzaCDs2002$10$152003$11$

46、152004$12$162005$13$15For each year, compute the cost of the basket the CPI (use 2002 as the base year) the inflation rate from the preceding yearCHAPTER 2 The Data of MacroeconomicsCost of Inflationbasket CPIrate2002$350100.0n.a.2003 370105.75.7%2004 400114.38.1%2005 410117.12.5%Answers:CHAPTER 2 T

47、he Data of MacroeconomicsThe composition of the CPIs “basket”CHAPTER 2 The Data of MacroeconomicsCPI vs. GDP Deflatorprices of capital goodsmincluded in GDP deflator (if produced domestically)mexcluded from CPIprices of imported consumer goodsmincluded in CPImexcluded from GDP deflatorthe basket of

48、goodsmCPI: fixedmGDP deflator: changes every yearmThe example of destroyed orange cropl Laspeyres index: a price index with a fixed basket of goods. Ex) CPI - tends to overstate the increase in the cost of living (ignore substitution opportunity)l Paasche index: a price index with a changing basket

49、of goods. Ex) GDP deflatorl - tends to understate the increase in the cost of living (ignore the reduction of welfare)l Fisher index: average of the two measured rates of inflationCHAPTER 2 The Data of MacroeconomicsTwo measures of inflation in the U.S.CHAPTER 2 The Data of MacroeconomicsReasons why

50、 the CPI may overstate inflationl Substitution bias: The CPI uses fixed weights, so it cannot reflect consumers ability to substitute toward goods whose relative prices have fallen.l Introduction of new goods: The introduction of new goods makes consumers better off and, in effect, increases the rea

51、l value of the dollar. But it does not reduce the CPI, because the CPI uses fixed weights.l Unmeasured changes in quality: Quality improvements increase the value of the dollar, but are often not fully measured. CHAPTER 2 The Data of MacroeconomicsThe size of the CPIs biaslIn 1995, a Senate-appointe

52、d panel of experts estimated that the CPI overstates inflation by about 1.1% per year.lSo the BLS made adjustments to reduce the bias.lNow, the CPIs bias is probably under 1% per year. CHAPTER 2 The Data of MacroeconomicsDiscussion questions:l If your grandmother receives Social Security, how is she

53、 affected by the CPIs bias?l Where does the government get the money to pay COLAs to Social Security recipients?l If you pay income and Social Security taxes, how does the CPIs bias affect you?l Is the government giving your grandmother too much of a COLA?l How does your grandmothers “basket” differ

54、 from the CPIs? CHAPTER 2 The Data of MacroeconomicsCategories of the populationl employed working at a paid job l unemployed not employed but looking for a job l labor force the amount of labor available for producing goods and services; all employed plus unemployed persons l not in the labor force not employed, not looking for workl A person who wants a job but has given up looking a discouraged worker is counted as not being in the labor force.CHAPT