In Chapters 1 and 2 we considered the role of the money demand function in comparative static models. These models were the dominant macroeconomic paradigm up until thirty years ago. Recently, however, neoclassical growth theory and related dynamical approaches have widely spread into both macroeconomics and monetary economics and are now routinely used in exploring fiscal and monetary policy issues.
KeywordsMarginal Product Saving Rate Balance Growth Path Overlap Generation Model Perfect Competition
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