Dynamic Macroeconomics is an attempt to revitalize the traditions of nonmarket clearing approaches to macroeconomics. Using sophisticated tools from dynamic analysis, the authors introduce a consistent, integrated framework for disequilibrium macroeconomic dynamics and explore its relationship to the competing—and currently dominant—equilibrium dynamics.
The book is organized into five parts. Part I covers background models of market-clearing and nonmarket-clearing approaches. Part II introduces short-run monetary models of macroeconomic fluctuations that build on the dynamic interaction of product, labor, and financial markets. Part III explores monetary instability in variants with capital accumulation and growth. Part IV explores supply and demand side Keynesian business cycles and monetary-type growth models. Part V considers the role of the financial sector as a source of instability and fluctuations.
"Macrodynamics is a venerable and important tradition, which fifty or sixtyyears ago engaged the best minds of the economics profession: among themFrisch, Tinbergan, Harrod, Hicks, Samuelson, Goodwin. Recently it has beenin danger of being swallowed up by rational expectations, movingequilibrium, and dynamic optimization. We can be grateful to the authorsof this book for keeping alive the older tradition, while modernizing it inthe light of recent developments in techniques of dynamic modeling."
—James Tobin, Sterling Professor of Economics Emeritus, Yale University