Introduction to Economic Growth and Stability

1
Introduction to Economic Growth and Stability

• Chapter 8

2
Chapter 8 Table 8.1
3
Chapter 8 Figure 8.1
4
Historical U.S. Real GDP

• http//research.stlouisfed.org/fred2/series/GDPC1/
  106

5
Chapter 8 Table 8.2
6
Employment/Unemployment Categories
Chapter 8 Figure 8.2
7
Unemployment Rate

• u (number unemployed/labor force) x 100
• Labor Force Participation Rate
• (labor force/total adult population) x 100
• http//research.stlouisfed.org/fred2/series/CIVPAR
  T?cid10

8
Kinds of Unemployment

• Structural Unemployment
• Technological change and/or industry migration
• Frictional Unemployment
• Workers voluntarily search for new jobs
• Cyclical Unemployment
• Associated with recession
• Seasonal Unemployment
• Affects different industries at different times
  of the year

9
Potential v. Actual Real GDP
Chapter 8 Figure 8.3(a)
10
Potential v. Actual Real GDP

• Potential Real GDP assumes full employment
• i.e., about 6 unemployment
• http//research.stlouisfed.org/fred2/series/GDPPOT
  /106
• Actual Real GDP (or simply Real GDP)
• captures the actual unemployment rate
• http//research.stlouisfed.org/fred2/series/GDPC1/
  106

11
Historical Unemployment
Chapter 8 Figure 8.3(b)

• http//research.stlouisfed.org/fred2/series/UNRATE
  /10

12
Chapter 8 Table 8.3
13
Historical Price Inflation
Chapter 8 Figure 8.4
14
Real v. Nominal Interest Rates
Chapter 8 Figure 8.5