This document introduces new notation and concepts for modeling an open economy using the Regional Economy (REG) model. It defines symbols for variables such as exports (X), imports (IM), government expenditures (GTN), and regional holdings (N, S). It also presents the national income equations and other key equations that describe regional disposable income, taxes, wealth, consumption, money demand, and bond demand for the open REG model. The objectives are to analyze steady state solutions and conduct experiments by changing parameters like trade propensity (μS) and government spending.
Jessye Bemley was a presenter at the BDPA IT Showcase held in Raleigh NC at the 2009 BDPA Technology Conference.
Here is intro to her research assignment: "Many companies have different products that they use or make on a regular basis. To help them through this process they use different production planning tools such as forecasting, Materials Requirement Planning System (MRP), Linear Programming, Inventory plan and Aggregate Plan or workforce plan. During INEN 355 or Production Control class we were given a case study project of a company called Mike’s Bikes. From the information given, we were to use all of the tools listed above to help the owner of the company have a successful business."
Jessye Bemley was a presenter at the BDPA IT Showcase held in Raleigh NC at the 2009 BDPA Technology Conference.
Here is intro to her research assignment: "Many companies have different products that they use or make on a regular basis. To help them through this process they use different production planning tools such as forecasting, Materials Requirement Planning System (MRP), Linear Programming, Inventory plan and Aggregate Plan or workforce plan. During INEN 355 or Production Control class we were given a case study project of a company called Mike’s Bikes. From the information given, we were to use all of the tools listed above to help the owner of the company have a successful business."
Social Media as a Bridge between Teaching and ResearchStephen Kinsella
Here's a talk I gave on Tuesday to a symposium on Social Media with Prof. Gerry McKiernan, revolving around using social media tools like this blog, the text messaging software, and The Twitter, etc, to communicate and interact with my students.
A Matching Model with Friction and Multiple CriteriaStephen Kinsella
We present a model of matching based on two character measures.
There are two classes of individual. Each individual
observes a sequence of potential partners from the opposite class.
One
measure describes the "attractiveness" of an individual.
Preferences are common according to
this measure: i.e. each individual prefers highly attractive partners and all individuals
of a given class agree as to how attractive individuals of the opposite class are. Preferences are
homotypic with respect to the second measure, referred to as "character" i.e.
all individuals prefer partners of a similar character.
Such a problem may be interpreted as e.g. a job search problem in which the classes
are employer and employee, or a mate choice problem in which the classes are male and
female.
It is assumed that
attractiveness is easy to measure and observable with certainty. However,
in order to observe the character of an individual, an interview (or courtship) is required.
Hence, on observing the attractiveness of a prospective partner an individual must decide whether he/she wishes
to proceed to the interview stage. Interviews only occur by mutual consent. A pair can only be formed
after an interview. During the interview phase the prospective pair
observe each other's
character, and then decide whether they wish to form a pair.
It is assumed that mutual acceptance is required for pair formation to
occur. An individual stops searching on finding a partner.
This paper
presents a general model of such a matching process. A particular case is
considered in which character "forms a ring" and has a uniform distribution.
A set of criteria based on the concept of a subgame
perfect Nash equilibrium is used to define the solution of this particular game. It is shown that
such a solution is unique. The general form of the solution is derived and a procedure for finding
the solution of such a game is given.
GDG Cloud Southlake #33: Boule & Rebala: Effective AppSec in SDLC using Deplo...James Anderson
Effective Application Security in Software Delivery lifecycle using Deployment Firewall and DBOM
The modern software delivery process (or the CI/CD process) includes many tools, distributed teams, open-source code, and cloud platforms. Constant focus on speed to release software to market, along with the traditional slow and manual security checks has caused gaps in continuous security as an important piece in the software supply chain. Today organizations feel more susceptible to external and internal cyber threats due to the vast attack surface in their applications supply chain and the lack of end-to-end governance and risk management.
The software team must secure its software delivery process to avoid vulnerability and security breaches. This needs to be achieved with existing tool chains and without extensive rework of the delivery processes. This talk will present strategies and techniques for providing visibility into the true risk of the existing vulnerabilities, preventing the introduction of security issues in the software, resolving vulnerabilities in production environments quickly, and capturing the deployment bill of materials (DBOM).
Speakers:
Bob Boule
Robert Boule is a technology enthusiast with PASSION for technology and making things work along with a knack for helping others understand how things work. He comes with around 20 years of solution engineering experience in application security, software continuous delivery, and SaaS platforms. He is known for his dynamic presentations in CI/CD and application security integrated in software delivery lifecycle.
Gopinath Rebala
Gopinath Rebala is the CTO of OpsMx, where he has overall responsibility for the machine learning and data processing architectures for Secure Software Delivery. Gopi also has a strong connection with our customers, leading design and architecture for strategic implementations. Gopi is a frequent speaker and well-known leader in continuous delivery and integrating security into software delivery.
Removing Uninteresting Bytes in Software FuzzingAftab Hussain
Imagine a world where software fuzzing, the process of mutating bytes in test seeds to uncover hidden and erroneous program behaviors, becomes faster and more effective. A lot depends on the initial seeds, which can significantly dictate the trajectory of a fuzzing campaign, particularly in terms of how long it takes to uncover interesting behaviour in your code. We introduce DIAR, a technique designed to speedup fuzzing campaigns by pinpointing and eliminating those uninteresting bytes in the seeds. Picture this: instead of wasting valuable resources on meaningless mutations in large, bloated seeds, DIAR removes the unnecessary bytes, streamlining the entire process.
In this work, we equipped AFL, a popular fuzzer, with DIAR and examined two critical Linux libraries -- Libxml's xmllint, a tool for parsing xml documents, and Binutil's readelf, an essential debugging and security analysis command-line tool used to display detailed information about ELF (Executable and Linkable Format). Our preliminary results show that AFL+DIAR does not only discover new paths more quickly but also achieves higher coverage overall. This work thus showcases how starting with lean and optimized seeds can lead to faster, more comprehensive fuzzing campaigns -- and DIAR helps you find such seeds.
- These are slides of the talk given at IEEE International Conference on Software Testing Verification and Validation Workshop, ICSTW 2022.
Social Media as a Bridge between Teaching and ResearchStephen Kinsella
Here's a talk I gave on Tuesday to a symposium on Social Media with Prof. Gerry McKiernan, revolving around using social media tools like this blog, the text messaging software, and The Twitter, etc, to communicate and interact with my students.
A Matching Model with Friction and Multiple CriteriaStephen Kinsella
We present a model of matching based on two character measures.
There are two classes of individual. Each individual
observes a sequence of potential partners from the opposite class.
One
measure describes the "attractiveness" of an individual.
Preferences are common according to
this measure: i.e. each individual prefers highly attractive partners and all individuals
of a given class agree as to how attractive individuals of the opposite class are. Preferences are
homotypic with respect to the second measure, referred to as "character" i.e.
all individuals prefer partners of a similar character.
Such a problem may be interpreted as e.g. a job search problem in which the classes
are employer and employee, or a mate choice problem in which the classes are male and
female.
It is assumed that
attractiveness is easy to measure and observable with certainty. However,
in order to observe the character of an individual, an interview (or courtship) is required.
Hence, on observing the attractiveness of a prospective partner an individual must decide whether he/she wishes
to proceed to the interview stage. Interviews only occur by mutual consent. A pair can only be formed
after an interview. During the interview phase the prospective pair
observe each other's
character, and then decide whether they wish to form a pair.
It is assumed that mutual acceptance is required for pair formation to
occur. An individual stops searching on finding a partner.
This paper
presents a general model of such a matching process. A particular case is
considered in which character "forms a ring" and has a uniform distribution.
A set of criteria based on the concept of a subgame
perfect Nash equilibrium is used to define the solution of this particular game. It is shown that
such a solution is unique. The general form of the solution is derived and a procedure for finding
the solution of such a game is given.
GDG Cloud Southlake #33: Boule & Rebala: Effective AppSec in SDLC using Deplo...James Anderson
Effective Application Security in Software Delivery lifecycle using Deployment Firewall and DBOM
The modern software delivery process (or the CI/CD process) includes many tools, distributed teams, open-source code, and cloud platforms. Constant focus on speed to release software to market, along with the traditional slow and manual security checks has caused gaps in continuous security as an important piece in the software supply chain. Today organizations feel more susceptible to external and internal cyber threats due to the vast attack surface in their applications supply chain and the lack of end-to-end governance and risk management.
The software team must secure its software delivery process to avoid vulnerability and security breaches. This needs to be achieved with existing tool chains and without extensive rework of the delivery processes. This talk will present strategies and techniques for providing visibility into the true risk of the existing vulnerabilities, preventing the introduction of security issues in the software, resolving vulnerabilities in production environments quickly, and capturing the deployment bill of materials (DBOM).
Speakers:
Bob Boule
Robert Boule is a technology enthusiast with PASSION for technology and making things work along with a knack for helping others understand how things work. He comes with around 20 years of solution engineering experience in application security, software continuous delivery, and SaaS platforms. He is known for his dynamic presentations in CI/CD and application security integrated in software delivery lifecycle.
Gopinath Rebala
Gopinath Rebala is the CTO of OpsMx, where he has overall responsibility for the machine learning and data processing architectures for Secure Software Delivery. Gopi also has a strong connection with our customers, leading design and architecture for strategic implementations. Gopi is a frequent speaker and well-known leader in continuous delivery and integrating security into software delivery.
Removing Uninteresting Bytes in Software FuzzingAftab Hussain
Imagine a world where software fuzzing, the process of mutating bytes in test seeds to uncover hidden and erroneous program behaviors, becomes faster and more effective. A lot depends on the initial seeds, which can significantly dictate the trajectory of a fuzzing campaign, particularly in terms of how long it takes to uncover interesting behaviour in your code. We introduce DIAR, a technique designed to speedup fuzzing campaigns by pinpointing and eliminating those uninteresting bytes in the seeds. Picture this: instead of wasting valuable resources on meaningless mutations in large, bloated seeds, DIAR removes the unnecessary bytes, streamlining the entire process.
In this work, we equipped AFL, a popular fuzzer, with DIAR and examined two critical Linux libraries -- Libxml's xmllint, a tool for parsing xml documents, and Binutil's readelf, an essential debugging and security analysis command-line tool used to display detailed information about ELF (Executable and Linkable Format). Our preliminary results show that AFL+DIAR does not only discover new paths more quickly but also achieves higher coverage overall. This work thus showcases how starting with lean and optimized seeds can lead to faster, more comprehensive fuzzing campaigns -- and DIAR helps you find such seeds.
- These are slides of the talk given at IEEE International Conference on Software Testing Verification and Validation Workshop, ICSTW 2022.
Transcript: Selling digital books in 2024: Insights from industry leaders - T...BookNet Canada
The publishing industry has been selling digital audiobooks and ebooks for over a decade and has found its groove. What’s changed? What has stayed the same? Where do we go from here? Join a group of leading sales peers from across the industry for a conversation about the lessons learned since the popularization of digital books, best practices, digital book supply chain management, and more.
Link to video recording: https://bnctechforum.ca/sessions/selling-digital-books-in-2024-insights-from-industry-leaders/
Presented by BookNet Canada on May 28, 2024, with support from the Department of Canadian Heritage.
Why You Should Replace Windows 11 with Nitrux Linux 3.5.0 for enhanced perfor...SOFTTECHHUB
The choice of an operating system plays a pivotal role in shaping our computing experience. For decades, Microsoft's Windows has dominated the market, offering a familiar and widely adopted platform for personal and professional use. However, as technological advancements continue to push the boundaries of innovation, alternative operating systems have emerged, challenging the status quo and offering users a fresh perspective on computing.
One such alternative that has garnered significant attention and acclaim is Nitrux Linux 3.5.0, a sleek, powerful, and user-friendly Linux distribution that promises to redefine the way we interact with our devices. With its focus on performance, security, and customization, Nitrux Linux presents a compelling case for those seeking to break free from the constraints of proprietary software and embrace the freedom and flexibility of open-source computing.
Encryption in Microsoft 365 - ExpertsLive Netherlands 2024Albert Hoitingh
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Sudheer Mechineni, Head of Application Frameworks, Standard Chartered Bank
Discover how Standard Chartered Bank harnessed the power of Neo4j to transform complex data access challenges into a dynamic, scalable graph database solution. This keynote will cover their journey from initial adoption to deploying a fully automated, enterprise-grade causal cluster, highlighting key strategies for modelling organisational changes and ensuring robust disaster recovery. Learn how these innovations have not only enhanced Standard Chartered Bank’s data infrastructure but also positioned them as pioneers in the banking sector’s adoption of graph technology.
A tale of scale & speed: How the US Navy is enabling software delivery from l...sonjaschweigert1
Rapid and secure feature delivery is a goal across every application team and every branch of the DoD. The Navy’s DevSecOps platform, Party Barge, has achieved:
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Development teams can ship efficiently and ensure applications are cyber ready for Navy Authorizing Officials (AOs). In this webinar, Sigma Defense and Anchore will give attendees a look behind the scenes and demo secure pipeline automation and security artifacts that speed up application ATO and time to production.
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- How to deliver security artifacts that matter for ATO’s (SBOMs, vulnerability reports, and policy evidence)
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Smart TV Buyer Insights Survey 2024 by 91mobiles.pdf91mobiles
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Participants will gain insights into the responsibilities, challenges, and best practices associated with test management in SAP projects. Additionally, the webinar delves into the significance of heatmaps as a visual aid for identifying testing priorities, areas of risk, and resource allocation within SAP landscapes. Through this session, attendees can expect to enhance their understanding of test management principles while learning practical approaches to optimize testing processes in SAP environments using heatmap visualization techniques
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Orchestrator execution result
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Deepak Rai, Automation Practice Lead, Boundaryless Group and UiPath MVP
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https://alandix.com/academic/papers/synergy2024-epistemic/
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The Evolution of a Regional Economy
1. New Notation
Introduction
Steady State Solutions in REG
Experiments with REG
EC6012 Lecture 8
The Open Economy
Stephen Kinsella
Dept. Economics,
University of Limerick
March 11, 2008
Stephen Kinsella EC6012 Lecture 8
2. New Notation
Introduction
Steady State Solutions in REG
Experiments with REG
Objectives today
1 New Notation
2 Introduction
3 Steady State Solutions in REG
4 Experiments with REG
Increasing µS
Increasing GTS
Increasing (1 − µS )
Changing Liquidity Preferences
Stephen Kinsella EC6012 Lecture 8
3. New Notation
Introduction
Steady State Solutions in REG
Experiments with REG
New Notation
All the notation you’re no doubt familiar with (C , G , Y ), etc is still
in use, but for space and sanity, I’m only including the newer
variables and parameters to be used in this model.
Symbol Meaning
N, S North and South Holdings, respectively. µ Propen
X Exports
IM Imports
GTN Total Government expenditures injected in a period.
Stephen Kinsella EC6012 Lecture 8
4. New Notation
Introduction
Steady State Solutions in REG
Experiments with REG
Introduction
PC and PCEX are extended here to show the interactions and
feedbacks from a two region economy with trade. We partition PC
into a North (N) and a South (S) and allow imports and exports
to and from these regions.
Stephen Kinsella EC6012 Lecture 8
5. New Notation
Introduction
Steady State Solutions in REG
Experiments with REG
Balance Sheet Matrix for REG
Introducing the Open Economy 171
Table 6.1 Balance sheet of two-region economy (Model REG)
North South Central
households households Government bank
Cash money N
+Hh S
+Hh −H 0
Bills +BN
h
+BS
h
−B +Bcb 0
Wealth (balancing item) N
−Vh S
−Vh −Vg 0 0
0 0 0 0 0
temic approach, methodologically identical with the closed economy models
Figure: Balance Sheet Matrix for REG
already presented.2
Our open-economy models will evolve organically in stages from model
PC in Chapter 4. We start off with the very same (closed) economy described
by model PC, and then imagine how the economies of two component
regions, which together make up the total, interact with one another and
with the government. This will be Model REG. In subsequent sections we deal
with a two-country system, each with its own currency. This will be Model
OPEN.
6.2 The matrices of a two-region economy
Stephen Kinsella EC6012 Lecture 8
6. New Notation
Introduction
Steady State Solutions in REG
Experiments with REG
National Income Equations
YN = C N + G N + X N − IM N , (1)
N N N
IM = µ ·Y , (2)
N S
X = IM . (3)
(4)
Stephen Kinsella EC6012 Lecture 8
7. New Notation
Introduction
Steady State Solutions in REG
Experiments with REG
Other Key Equations
The next equations describe the evolution of regional disposable
income, taxes, wealth, consumption, money demand and bills (we
call them bonds) demand functions.
YD N = Y N − T N + r−1 · Bh−1
N
(5)
TN = θ · (Y N + r−1 · Bh−1 )
N
0<θ<1 (6)
N
V = V−1 + (YD N − C N )
N
(7)
N
C = N N
α1 · YD N + α2 · V−1
N
0 < α1 < α2 < 1 (8)
N
Hh = V N − BhN
(9)
N
Bh YD N
= λN + λ N · r − λN ·
0 1 2 (10)
VN VN
Stephen Kinsella EC6012 Lecture 8
8. New Notation
Introduction
Steady State Solutions in REG
Experiments with REG
Other Key Equations
The next equations describe the evolution of regional disposable
income, taxes, wealth, consumption, money demand and bills (we
call them bonds) demand functions.
YD N = Y N − T N + r−1 · Bh−1
N
(5)
TN = θ · (Y N + r−1 · Bh−1 )
N
0<θ<1 (6)
N
V = V−1 + (YD N − C N )
N
(7)
N
C = N N
α1 · YD N + α2 · V−1
N
0 < α1 < α2 < 1 (8)
N
Hh = V N − BhN
(9)
N
Bh YD N
= λN + λ N · r − λN ·
0 1 2 (10)
VN VN
Stephen Kinsella EC6012 Lecture 8
9. New Notation
Introduction
Steady State Solutions in REG
Experiments with REG
Other Key Equations
The next equations describe the evolution of regional disposable
income, taxes, wealth, consumption, money demand and bills (we
call them bonds) demand functions.
YD N = Y N − T N + r−1 · Bh−1
N
(5)
TN = θ · (Y N + r−1 · Bh−1 )
N
0<θ<1 (6)
N
V = V−1 + (YD N − C N )
N
(7)
N
C = N N
α1 · YD N + α2 · V−1
N
0 < α1 < α2 < 1 (8)
N
Hh = V N − BhN
(9)
N
Bh YD N
= λN + λ N · r − λN ·
0 1 2 (10)
VN VN
Stephen Kinsella EC6012 Lecture 8
10. New Notation
Introduction
Steady State Solutions in REG
Experiments with REG
Other Key Equations
The next equations describe the evolution of regional disposable
income, taxes, wealth, consumption, money demand and bills (we
call them bonds) demand functions.
YD N = Y N − T N + r−1 · Bh−1
N
(5)
TN = θ · (Y N + r−1 · Bh−1 )
N
0<θ<1 (6)
N
V = V−1 + (YD N − C N )
N
(7)
N
C = N N
α1 · YD N + α2 · V−1
N
0 < α1 < α2 < 1 (8)
N
Hh = V N − BhN
(9)
N
Bh YD N
= λN + λ N · r − λN ·
0 1 2 (10)
VN VN
Stephen Kinsella EC6012 Lecture 8
11. New Notation
Introduction
Steady State Solutions in REG
Experiments with REG
Other Key Equations
The next equations describe the evolution of regional disposable
income, taxes, wealth, consumption, money demand and bills (we
call them bonds) demand functions.
YD N = Y N − T N + r−1 · Bh−1
N
(5)
TN = θ · (Y N + r−1 · Bh−1 )
N
0<θ<1 (6)
N
V = V−1 + (YD N − C N )
N
(7)
N
C = N N
α1 · YD N + α2 · V−1
N
0 < α1 < α2 < 1 (8)
N
Hh = V N − BhN
(9)
N
Bh YD N
= λN + λ N · r − λN ·
0 1 2 (10)
VN VN
Stephen Kinsella EC6012 Lecture 8
12. New Notation
Introduction
Steady State Solutions in REG
Experiments with REG
Other Key Equations
The next equations describe the evolution of regional disposable
income, taxes, wealth, consumption, money demand and bills (we
call them bonds) demand functions.
YD N = Y N − T N + r−1 · Bh−1
N
(5)
TN = θ · (Y N + r−1 · Bh−1 )
N
0<θ<1 (6)
N
V = V−1 + (YD N − C N )
N
(7)
N
C = N N
α1 · YD N + α2 · V−1
N
0 < α1 < α2 < 1 (8)
N
Hh = V N − BhN
(9)
N
Bh YD N
= λN + λ N · r − λN ·
0 1 2 (10)
VN VN
Stephen Kinsella EC6012 Lecture 8
13. New Notation
Introduction
Steady State Solutions in REG
Experiments with REG
Steady State Solutions
A region reaches their steady state when the change in household
wealth from period to period is zero, so ∆V = 0. The condition
where this holds is
GT + X N = T N + IM N
N
(11)
In the stationary state, GDP in the North will depend on the
following condition:
GT + X N
N
Y N∗ = (12)
θ + µN
Stephen Kinsella EC6012 Lecture 8
14. New Notation
Introduction
Steady State Solutions in REG
Experiments with REG
Harrod’s Foreign Trade Multiplier
Discussion
Equation 12 shows the Harrod foreign trade multiplier, which
shows how the North’s output is dependent on the North’s
government expenditure and their exports, divided by the tax and
import propensities.
What does this imply for policies to get the economy to the steady
state?
Stephen Kinsella EC6012 Lecture 8
15. New Notation Increasing µS
S
Introduction Increasing GT
Steady State Solutions in REG Increasing (1 − µS )
Experiments with REG Changing Liquidity Preferences
Experiments: Evolution of Balances North and South
Introducing the Open Economy 181
North region GDP
109.5
108.0
106.5
105.0
103.5
South region GDP
102.0
1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000
Figure 6.1 Evolution of GDP in the North and the South regions, following an increase
in the propensity to import of the South region
Figure: Evolution of Balances North and South
The evolution of output in each region, as described in the preceding
Stephen Kinsella EC6012 Lecture 8
16. New Notation Increasing µS
S
Introduction Increasing GT
Steady State Solutions in REG Increasing (1 − µS )
Experiments with REG Changing Liquidity Preferences
Evolution of GDP in North-South Regions following an
increase in µS
182 Monetary Economics
0.00
Change in household wealth
of the South region
–0.25
–0.50
Government balance with the South region
–0.75
–1.00
Trade balance of the South region
–1.25
1951 1956 1961 1966 1971 1976 1981 1986 1991 1996 2001
Figure 6.2 Evolution of the balances of the South region – net acquisition of financial
Figure:assets by the household sector, in North-South Regions following an increase
Evolution of GDP government budget balance, trade balance – following
in µS an increase in the propensity to import of the South region
which exists between two parts of a single country which has a unitary fiscal
Stephen Kinsella EC6012 Lecture 8
17. New Notation Increasing µS
S
Introduction Increasing GT
Steady State Solutions in REG Increasing (1 − µS )
Experiments with REG Changing Liquidity Preferences
S
Increasing GT
184
128.0
124.0
South region GDP
120.0
116.0 North region GDP
112.0
108.0
1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000
Figure 6.3 Evolution of GDP in the South and the North regions, following an increase
Figure: Evolution of GDP in North-South Regions following an increase
in the government expenditures in the South region
S
in GT
2.0
Stephen Kinsella EC6012 Lecture 8
18. 108.0
New Notation Increasing µS
S
Introduction Increasing GT
Steady State Solutions in REG Increasing (1 − µS )
1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000
Experiments with REG Changing Liquidity Preferences
S
Figure 6.3 Evolution of GDP in the South and the North regions, following an increase
Evolution of Balances following an increase in GT
in the government expenditures in the South region
2.0
1.0 Change in household wealth
of the South region
0.0
–1.0
Trade balance of the South region
–2.0
Government balance
with the South region
–3.0
1951 1956 1961 1966 1971 1976 1981 1986 1991 1996 2001
Figure 6.4 Evolution of the balances of the South region – net acquisition of financial
assets by the household sector, government budget balance, trade balance – following
S
Figure: Evolution of Balances following an increase in GT
an increase in the government expenditures in the South region
Stephen Kinsella EC6012 Lecture 8
19. New Notation Increasing µS
S
Introduction Increasing GT
Steady State Solutions in REG Increasing (1 − µS )
Experiments with REG Changing Liquidity Preferences
Evolution of GDP following an increase in Southern
Propensities to Save
Introducing the Open Economy 185
107.50
106.25 North region GDP
105.00
103.75
South region GDP
102.50
101.25
1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000
Figure 6.5 Evolution of GDP in the North and South regions, following an increase
Figure: Evolution of GDP following an increase in Southern Propensities
in the propensity to save of South region households
to Save
to a higher steady-state level of output. What happensLecture 8our two-region
Stephen Kinsella EC6012 now in
20. New Notation Increasing µS
S
Introduction Increasing GT
Steady State Solutions in REG Increasing (1 − µS )
Experiments with REG Changing Liquidity Preferences
Evolution of Balances following an increase in µS
Introducing the Open Economy 185
107.50
106.25 North region GDP
105.00
103.75
South region GDP
102.50
101.25
1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000
Figure 6.5 Evolution of GDP in the North and South regions, following an increase
Figure: Evolution of Balances following an increase in µS
in the propensity to save of South region households
to a higher steady-state level of output. What happens now in our two-region
economy if the households in one region decide to increase their propensity
Stephen Kinsella EC6012 Lecture 8
21. New Notation Increasing µS
S
Introduction Increasing GT
Steady State Solutions in REG Increasing (1 − µS )
Experiments with REG Changing Liquidity Preferences
Evolution of Balances following a change in Southern
liquidity preferences.
Introducing the Open Economy 187
0.120
0.080
Increase in household wealth
of the South region
0.040
0.000
Trade deficit of the South region
–0.040
Government deficit with the South region
–0.080
1951 1956 1961 1966 1971 1976 1981 1986 1991 1996 2001
Figure 6.7 Evolution of the balances of the South region – net acquisition of financial
assets by the household sector, government budget balance, trade balance – following
Figure: Evolution of Balances following a change in Southern liquidity
a decrease in the liquidity preference of South region households
preferences.
in liquidity preference by Southern households has some positive economic
repercussions on the South, as it now benefits from higher total government
expenditures. But all these effects are of a second-order magnitude.
Stephen Kinsella EC6012 Lecture 8
22. New Notation Increasing µS
S
Introduction Increasing GT
Steady State Solutions in REG Increasing (1 − µS )
Experiments with REG Changing Liquidity Preferences
Next Time
The Open Economy. Read GL, pages 187–211.
Stephen Kinsella EC6012 Lecture 8