Unemployment, inflation, and national output
This program begins to look at how cycles in an economy develop by explaining how unemployment, inflation, and gross domestic product are measured. The program also introduces aggregate supply and demand, and uses these concepts to spell out why bus...
GDP and the multiplier process
In the first of two programs on fiscal policy, we take a behind-the-scenes look at the aggregate demand curve. Key concepts include how the equilibrium level of GDP is determined and how the multiplier process works.
Money and banking
This program examines government attempts to stabilize the economy, focusing on monetary policy. Concepts explored include fractional reserve banking, the deposits in chartered banks as a major component of the country's money supply, and how charte...
Market failure: externalities
This program looks at the problem of public good associated with a dramatic spillover, and examines the beneficial and detrimental externalities associated with a less extensive spillover. The program also looks at how pollution, a classic example o...
Growth and development
This program looks at how growth in the standard of living occurs and what government policy can do to affect this process. Among the concepts explained in the program is how growth policy differs from stabilization policy.
Market failure: monopoly
This program looks at the inefficiencies of monopoly and how a government-created monopoly can be eliminated. Removing an inefficient natural monopoly is more difficult; the program describes three methods.
Pitfalls in stabilization policy
This program discusses monetary and fiscal policy for a large economy. Some key topics are the crowding-out effect, the short-run trade-off between inflation and unemployment, and how stabilization policies with long lags can affect business cycles.
Competition versus central planning
This program develops the short-run supply curve for a competitive industry and shows what determines long-run equilibrium in a competitive economy. The program provides a detailed account of "the invisible hand," and identifies some of the desirabl...
Interest rates and exchange rates
By combining the supply and demand of money, this program demonstrates how interest rates are determined. The program also examines flexible and fixed exchange rates and looks at how monetary policy works in large and small economies.
Fiscal policy and the deficit
This program assesses the effectiveness of fiscal policy. The program explains the channels through which fiscal policy can work, demonstrates how government policy can alter net exports, and describes how a well-designed fiscal policy operates.