Preface Section One - The Neoclassical Theory of Economic Growth and Production 1. An introduction to macroeconomic reasoning: The Malthusian model The Malthusian model The equilibrium population size and standard of living The policy prescriptions of the Malthusian model Where does the Malthusian model stand today? 2. The neoclassical model of economic growth Capital as a factor of production Production, income and the accumulation of capital The neoclassical model of economic growth 3. Some further properties of the neoclassical model The demand for and the price of capital services Factor proportions and the relative compensation of the factors Technological change and the neoclassical model Appendix: Mathematical properties of the neoclassical model Bibliography for Section One Section Two - Consumption and Saving 4. The microeconomic foundations of aggregate saving and consumption functions Introduction: Some historical background Consumption, saving and the life cycle The basic Fisherian model of the savings decision The basic model in algebraic form Appendix: Derivation of the consumption function 5. Some properties of the life-cycle model of consumption Consumption over the life cycle: Some numerical examples Essential properties of the life-cycle consumption function The response of consumption to unanticipated changes in income and wealth Concluding observations Appendix: The permanent income hypothesis 6. The neoclassical model with a life-cycle consumption function Steady-state equilibrium properties The adjustment to steady state Demographic variables and the equilibrium saving rate Bibliography for Section Two Section Three - Government Finance 7. The macroeconomics of taxation Modeling the public sector Tax policy and the equilibrium capital stock 8. The burden of the debt Does the debt make a difference? Implications of an increase in the debt on consumption and investment decisions Deficit financing as a permanent policy Appendix: An application to social security Bibliography for Section Three Section Four - Money and the Price Level 9. The microeconomic foundations of the demand for money Introduction The essential properties of the demand function for money 10. A consumption interpretation of the demand for money A life-cycle demand function for money The basis of the demand function for money Money holdings and consumption over the life cycle: Some numerical illustrations Appendix: Derivation of the demand function for money 11. The Quantity Theory of Money The effect of an unanticipated change in the supply of money The Quantity Theory of Money The formation of inflationary expectations 12. Money and the price level in a growing, full employment economy The anatomy of long-run equilibrium in a monetary economy The response to changes in the rate of growth of the money supply 13. Inflation as a tax Money creation as a revenue device The optimal rate of money creation 14. Fiscal policy and the price level The effects of an increase in government spending Must an increase in government spending be inflationary? Is deficit financing more inflationary than tax financing? 15. Money and banking The business of banking Monetary equilibrium with inside and outside money The fatal flaw in a fractional reserve banking system Central banks and the management of a fractional reserve banking system A further look at some of the assumptions Bibliography for Section Four Section Five - Unemployment 16. The microeconomic foundations of unemployment Price adjustment in a single market Unemployment in the labor market 17. The impact of monetary and fiscal policies on unemployment in the short run and the long Short-run equilibrium with sticky wage rates Fiscal and monetary policies for reducing unemployment: The conventional wisdom The trouble with conventional wisdom Is there a long-run Phillips curve? Bibliography for Section Five Index