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Price stability is a goal of monetary and fiscal policy aiming to support sustainable rates of economic activity. Policy is set to maintain a very low rate of inflation or deflation . For example, the European Central Bank (ECB) describes price stability as a year-on-year increase in the Harmonised Index of Consumer Prices (HICP) for the Euro ...
Friedman's book Price Theory: A Provisional Text, originally based on lecture notes taken by David I. Fand and Warren J. Gustus in 1951–52. These notes were popular among graduate students and eventually prompted Friedman to work on their publication. The revised edition was prepared when Friedman resumed teaching price theory in the early 1970s.
This single price change would not, however, represent general inflation in an overall economy. Overall inflation is measured as the price change of a large "basket" of representative goods and services. This is the purpose of a price index, which is the combined price of a "basket" of many goods and services. The combined price is the sum of ...
David I. Meiselman (/ ˈ m aɪ z əl m ə n /; 1924 – December 3, 2014) was an American economist.Among his contributions to the field of economics are his work on the term structure of interest rates, the foundation today of the implementation of monetary policy by major central banks, and his work with Milton Friedman on the impact of monetary policy on the performance of the economy and ...
However, stability depends not only on the number of equilibria but also on the type of the process that guides price changes (for a specific type of price adjustment process see Walrasian auction). Consequently, some researchers have focused on plausible adjustment processes that guarantee system stability, i.e., that guarantee convergence of ...
The price–specie flow mechanism is a model developed by Scottish economist David Hume (1711–1776) to illustrate how trade imbalances can self-correct and adjust under the gold standard. Hume expounded his argument in Of the Balance of Trade , which he wrote to counter the Mercantilist idea that a nation should strive for a positive balance ...
The Great Wave: Price Revolutions and the Rhythm of History is a scholarly work by historian David Hackett Fischer, published in 1996 by Oxford University Press.. Hackett Fischer identified three complete monetary waves in European history, each consisting of a price revolution, featuring high inflation, followed by a war crisis, followed by a new equilibrium.
The effect of this type of tax can be illustrated on a standard supply and demand diagram. Without a tax, the equilibrium price will be at Pe and the equilibrium quantity will be at Qe. After a tax is imposed, the price consumers pay will shift to Pc and the price producers receive will shift to Pp. The consumers' price will be equal to the ...