After-tax wage rate, 143
Alternative views, saving, 70–71
Brooks, Arthur C., 17
Capital in the Twenty-First Century (Piketty), 13, 127
Capital-to-labor ratio, 116–120
Central contradiction, 128–131
Chain-weight method, 22
Cobb-Douglas production function, 110–111
Consumption-saving choice, 52–57
Consumption smoothing, 87
Corporate income tax, 12, 147–152
Disposable personal income, 28–30
Easterly, William, 113
Economic growth
capital-to-labor ratio, 116–120
Gordon’s decline of growth, 123–125
“The Economy Needs More Spending Now” (Blinder), 7
The Elusive Quest for Economic Growth (Easterly), 113
Fair taxers, 154
Federal Reserve Open Market Committee, 6
Fixed weight method, 20
Flat taxers, 154
GDP. See Gross domestic product
The General Theory of Employment, Interest, and Money (Keynes), 2, 5
GNP. See Gross national product
Gordon’s decline of growth, 123–125
Government consumption, 163
Government consumption expenditures, 25
Government gross investment, 25
Government spending
government consumption, 163
infrastructure spending, 163–164
Government transfer payments (GTR), 26
Gross domestic product (GDP)
definition of, 17
real, 4
Gross National Happiness (Brooks), 17
Gross national product (GNP), 26
Gross private saving, 31
GTR. See Government transfer payments
IES. See Intertemporal elasticity of substitution
Individual equilibrium
consumption-saving choice, 52–57
substitution vs income effects, 63–66
two-period model with change, 57–59
work-now/work-later choice, 60–63
Infrastructure spending, 163–164
Interest parity condition, 104
International capital movements, 102–107
Intertemporal elasticity of substitution (IES), 74, 76
Labor force participation rate (LFPR), 163
Labor, supply and demand, 107–109
Law of diminishing returns, 98
LFPR. See Labor force participation rate
Lump-sum tax, 139
Macroeconomics
definition of, 1
microfoundations approach, 1–2
Marginal effective tax rate, 150
Marginal utility of leisure, 46
Mulligan, Casey, 159
National income, 28
National Income and Product Accounts (NIPA), 22, 24, 26
Net exports
definition of, 25
Net foreign investment (NFI), 32
Net lending/net borrowing, 32
Net national product (NNP), 28
Net real wage rate, 67
NFI. See Net foreign investment
NIPA. See National Income and Product Accounts
NNP. See Net national product
Output-to-labor ratio, 116–117
Permanent income hypothesis, 83–87
Personal consumption expenditures, 24
Personal income, 28
Policy implications, 66–68, 87–88
Purchasing power parity, 103
Real gross domestic product, 4
Real interest rate, 93
The Redistribution Recession (Mulligan), 159
Relative purchasing power parity, 104
Replacement rate, 159
Representative agent, 41
Rise and Fall of American Growth (Gordon), 13, 123
Sarkozy, Nicholas, 18
Saving
maximizing intertemporal utility, 75–78
permanent income hypothesis, 83–87
Stabilization policies, 3
Substitution vs income effects, 63–66
Summer, Lawrence, 13
Tax Cuts and Jobs Act, 10–11, 151
Taxes
Total factor productivity, 110, 123
Total utility of leisure, 46
Two-period model with change, 57–59