What does microeconomics analyze about individual agents?
Their choices and decisions in production, consumption, investment, and saving.
How does macroeconomics study economic systems?
By grouping agents into aggregates and analyzing economic flows between them.
Which economic aspects does macroeconomics study at the national level?
National production, overall consumption, investment, and the trade balance.
What central role does the state have in macroeconomics?
It acts through budgetary and monetary policies, planning, information, and incentives.
What is the central macroeconomic triptych?
The production, distribution, and redistribution of wealth.
How does instrumentalism validate a theory?
By the accuracy of its predictions.
What does realism seek in economic theory assumptions?
Assumptions closer to the complexity of reality.
How does orthodox macroeconomics model agents?
As representative rational agents maximizing utility or profit.
What does heterodox macroeconomics emphasize?
Social context, institutions, uncertainty, and limited procedural rationality.
What does the cost paradox demonstrate about reducing wages?
It can reduce aggregate demand by lowering workers' consumption.
How does the orthodox approach view the market and state roles?
Market is best for resource allocation; state corrects market failures.
What is an institution according to Commons, 1931?
A collective action controlling, liberating, and expanding individual action.
Which six institutional forms are identified in Fordist development?
Monetary regime, competition regime, wage relation, state and public goods, international integration, social relation to environment.
What does the monetary regime govern?
The management of the payment and credit system.
What defines a mode of regulation?
Rules formed by institutional structures framing economic dynamics and constraining agents.
What constitutes a mode of development?
The combination of a regime of accumulation and a mode of regulation.
What does Fordism combine in its economic regime?
An intensive accumulation regime based on mass consumption with an administered mode of regulation.
What is the sequence in the Fordist virtuous circle starting from high profits?
Business innovation, production modernization, productivity gains, higher wages, increased consumption, and higher production.
What are the four contradictions of Fordism?
Exhaustion of productivity gains, stronger worker bargaining power, inflation from wage and price struggles, and Bretton Woods collapse.
What does stagflation mean in economics?
Simultaneous general price increases and stagnating or slowing economic growth.
How does the pre-Keynesian view differ from the Keynesian view on credit and saving?
Pre-Keynesian: deposits create credits and saving is needed for investment; Keynesian: credits create deposits and investment generates saving.
What is financialization?
Growing use of debt financing causing more risk-taking and higher required returns on borrowed capital, harming labor remuneration.
In the financialized regime, what becomes the key macroeconomic indicator?
The valuation of shares.
What is the benchmark expected return on equity in the financialized regime?
15%.
What replaces the wage relation as dominant under financialized regulation?
The financial sector's health.
What effect does rising financial profitability have on the stock market?
It stimulates the stock market.
How does rising financial profitability affect consumption?
It increases consumption.
What happens to investment when financial profitability rises?
Investment is stimulated.
What is the formula for productivity of labour?
The ratio of value added to the quantity of labour.
What does liberalization aim to remove or limit in international trade?
Customs barriers such as tariffs and quotas.
Through which organizations has liberalization been institutionalized?
The GATT and later the WTO.
What does Joseph Schumpeter's concept of destructive creation describe?
Capitalist evolution where firms seek temporary monopoly through innovation.
Who introduced the concept of destructive creation?
Joseph Schumpeter.
How does stronger competition affect firms in the structural-reform mechanism?
It pushes firms to innovate.
What can innovation increase according to the structural-reform mechanism?
Production.
Why does the Keynesian model estimate larger fiscal multipliers?
Because households consume in the short term under price rigidity.
What assumption does the neoclassical model make about household consumption?
Households anticipate future tax increases and reduce consumption through Ricardian equivalence.
What errors did Herndon, Ash, and Pollin find in Reinhart and Rogoff's analysis?
They omitted data, calculated average growth rates incorrectly, and deliberately excluded data producing different results.
What growth effect did the corrected estimate find for countries with public debt over 90% of GDP?
A positive growth effect of about 2.2%.
What growth effect did Reinhart and Rogoff claim for countries with public debt over 90% of GDP?
A recessionary effect of 0.1%.
What is the estimated range of the real fiscal multiplier?
Between 1.3 and 2.5.
What was the estimated austerity cost in Europe between 2011 and 2013?
Approximately 5% to 8% of GDP.
What is innovation according to the definition?
An observable change involving new products, processes, markets, or organization.
Which six myths does Mazzucato identify about innovation?
Innovation measured by R&D, SMEs innovate more, venture capital likes risk, patents prove knowledge economy, Europe's commercialization problem, lower regulation and taxes stimulate investment.
Who identified six myths about innovation in 2013?
Mariana Mazzucato in The Entrepreneurial State.
Why is R&D considered necessary but insufficient for innovation?
Because its positive effect is strongest in fast-growing, competitive firms with alliances.
What conditions strengthen the relationship between R&D and development?
Rapid growth, high competition, and alliance connections.
What was the R&D intensity of industrial firms in 2017?
11%
What was the R&D intensity of service firms in 2017?
0.7%
What is industrial policy?
Public intervention supporting firms or industries through measures like mergers and innovation support.
How is the aggregate financialization indicator calculated?
where D is debt and CB is stock-market capitalization.
How did France's financialization indicator change from 1975 to 2015?
It increased from 140% to 360% of GDP.
What does shareholder value aim to increase?
The wealth of shareholders.
How do shareholders directly influence a firm?
Through voting rights where one share equals one vote.
What indirect method do shareholders use to influence firms?
Threatening to sell shares and lower the stock price.
What defines liquidity in financial terms?
The ability to convert a security into money without delay, cost, or capital risk.
On what factors does liquidity depend?
Market depth and mobility between financial-market segments.
What is employment precarization?
The deterioration of working conditions causing job instability and fewer protections.
What causes voluntary unemployment in neoclassical theory?
Rejecting unsatisfactory work conditions.
What causes involuntary unemployment in neoclassical theory?
Being unemployed despite willingness to work.
What relationship does the original Phillips-Lipsey curve describe?
A decreasing nonlinear relationship between unemployment and wage growth.
According to post-Keynesian economists, what determines employment?
The demand for goods.
How do higher wages affect labor demand in post-Keynesian theory?
They increase consumption and demand, raising labor demand if real wage is below productivity.
In which year did Keynes publish The General Theory of Employment, Interest and Money?
1936
Which work is regarded as marking the birth of macroeconomics?
The General Theory of Employment, Interest and Money by Keynes.
Which five conditions does orthodox macroeconomics rely on?
Atomicity, perfect information, product homogeneity, free market access, and factor mobility.
According to Alfred Marshall, what determines equilibrium price?
The intersection of supply, which increases with price, and demand, which decreases with price.
How did the share of agricultural workers in Western countries change from 1870 to 1973?
It fell from nearly 50% in 1870 to 8% in 1973.
How did the state support Fordism?
By supporting productive investment, consumption through infrastructure and social protection, and macroeconomic stability.
What role did the Bretton Woods system play in Fordism?
It contributed to international stability.
What percentage of housing construction was publicly financed in France in 1955?
46%.
What share of GDP did the nationalized sector represent in France in 1955?
18.6%.
What did the French Banking Law of 1984 introduce?
A uniform legal definition of credit institutions and allowed universal banking by ending bank specialization.
What ends under financialization regarding wages?
Wage indexation to inflation ends.
How does remuneration change under financialization?
It becomes more individualized.
What happens to collective protections under financialization?
They decline.
Who are the authors of Changer de modèle published in 2014?
Gilbert Cette, Philippe Aghion, and Élie Cohen.
What percentage of American business financing did public programs like SBIR and ATP represent?
Between 20% and 25%.
How do public funds compare to venture-capital funds in American business financing?
Public funds are two to eight times larger than venture-capital funds.
How did domestic business R&D expenditure change in manufacturing?
It fell by 12.62%.
How did domestic business R&D expenditure change in services?
It rose by 12.67%.
Who argued that Apple's core technologies came from decades of federal innovation support?
Mazzucato
What is an investment fund's main purpose?
To buy assets and resell them later at a higher price.
What percentage of financing in Europe is internal financing?
69%.
How is the inflation–unemployment relationship expressed in the course?
By the formula .
What percentage of employed individuals were employees in France in 2024?
86.9%.
Answer 67 questions on Inflation, State Capitalism and Ecology.
1. Which level of analysis examines the choices of individual agents in production, consumption, investment, and saving?
2. How does macroeconomics analyze an economy?
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