Classical and Keynesian Aggregate Supply- Macroeconomics
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- Опубліковано 27 сер 2024
- In this video I explain the three stages of the short run aggregate supply curve: Keynesian, Intermediate, and Classical. Thanks for watching. Please like and subscribe!
A new video about Keynesian Economics
/ @jacobaclifford
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dont listen to these dump comments below. doesn't matter how fast you speak, you explained the stuff very clear. great job
Better than my PhD professor from MIT. Tons of thanks.
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Rude, say this to my face next time
You are going to be the reason I don't fail ... I wish I thought to look up videos at the beginning of the semester. I would've had an A. You're so helpful!!
+Justine Kwiecinski I'm glad I was able to help. Please tell your friends taking econ in the furture. If we get the word out, no one should be freaking out about doing well in econ.
You got it!
Mr clifford, you are a legend, i am from ireland and my whole class watched all your videos last year, infact none of us would have passed our microeconomics exam without you, your a total legend around our college!
and ACDC comes through again for me teaching me things my professor failed too..... your the best!!!
Nice one man, was finding it hard to understand. But then ACDC Econ came along and rocked out macroeconomics. Very much appreciated
For around 3 weeks now I've been slaving over this entire series of concepts, making absolutely no headway. And, within 4 minutes and 29 seconds, I just understood EVERYTHING. Thank you SO much!
My instructor just went over this in class and nobody got but now I get it. Thank you for your vids. Please keep them coming!
This is a fantastically concise explanation. I try explaining this to my class going over way too many details and end up spending nearly an entire class period; you managed to communicate all the fundamental ideas in just over 4 minutes.
I spent 2 daya trying to explain this
Great class! Straight to the point
My dude you explained this so well thank you
I've been tryna understand this for ages in my econ class and now I finally do! thanks!
You are awesome, studying for my first year of uni macro exam...think you'll be the saviour of my grade! Many thanks from England :DD
It's actually a bit sad that this video explained a module of my course better than the powerpoint, text book and reading materials. lol
perfect. you teach Macro clearly, quickly and precicely! Thank you soooooooo much.
you can keep the speed at .75
I always do that for his videos
i put it at 1.5 to save time
though I was the only one haha, he is great but he speaks way too fast. at .75 is perfect
Macro test tomorrow and this was so helpful.
Thank you so much!!!
Was a big help to my test tmrw :D
How did your test go!
your videos always are always clear and amazing. Thanks!
He's so pragmatic. Thnaks!!!
wow you made it simple sir I am glad that I understood it I have an exam today
The ap exam is tomorrow, bless you sir 😭🙏🙏
You're a god. A god. I repeat. A GOD.
Awesome. Easy to learn. Thank you
This is amazing! Thank you so much!
Investopedia : Definition of 'Aggregate Demand'
The total amount of goods and services demanded in the economy at a given overall price level and in a given time period. It is represented by the aggregate-demand curve, which describes the relationship between price levels and the quantity of output that firms are willing to provide. Normally there is a negative relationship between aggregate demand and the price level. Also known as "total spending".
It's not that the free market will make perfect competition, but the Keynesian model here was formed AFTER the Great Depression and neglect the monetized debt and unstable interest rates the preceded. This Keynesian model creates a short run ideal of 'pushing the pendulum up and if you push the pendulum up, it'll have to have a back swing.
Market Deregulation and better supply side policy (e.g. training) leading to economic expansion is what countries want
Great info but my vertigo can't handle the movement. Thank you for keeping me from failing!
your the best eco teacher
Thank you so much for your videos. I didn't have a clue of what my economics teacher was rambling on about, thank god i found this
Good work man...I like the way you explain things....
Great teacher and great explanation!!! thank you!!
Lol whenever I see you jumping in the beginning of the video, I start to laugh! OMG I love your jump!
NICE JOB. WOW. YOU ARE BETTER THAN MY professor
@galamonkey well said my friend. government intervention is actually "causing" the sticky wages and prices. Take the housing market for example. After the collapse in 2008, housing prices did come down. But because we propped the market back up, they didnt' fall as much as they were supposed to, to recorrect itself. Keynesian economics is causing so much harm
u save my life so many times. i love u.
awsome you r so helpful in just this video my concepts r clear thank u
Therefore, I agree that Aggregate Demand is the total amount of goods and services demanded in a given industry at a give overall price for a given time, But it is Not a demand that affect the economy as a whole.
I really appreciate your videos, they are helping me a lot. I just have one request: Could you please slow down a bit? You talk really fast and seem really rushed. This would be much better if you would go slower.
Damn why did they remove this from the AP Macro curriculum? This seems like a way better model than the oversimplified one I was taught this year
you really help me alot in my report man!!!
Stable demand is different from aggregate in the sense that stable demand can be projected, whereas aggregate demand is undetermined because it is cause by natural disaster, war, transportation issues or political conflict. In that respect, aggregate demand reduces the total transaction that is possible within the global economy, which then affects the stock market.
Awesome. I am enlightened. Thank you.
this guy is great! excellent vid! thanks!
@galamonkey o yes that's why in the 'free market' monopolies charge much higher prices than equilbrium and monopsonies pay much lower wages than market equilbrium. there is no such thing as a truly 'free' market even without goverment intervention
Wish I found this guy along time ago
Is Classical the same as Old Keynesian?
No. Somehow what this video fails to explain what causes the change in Aggregate Supply and the change in Aggregate Demand. The basic ideas between these two contrasting models is that: 1.) In Classical, Supply creates its own demand; 2.) In Keynes, Demand creates its own supply.
yeeeeahhh mrs. Dorcy's class watching this video!
wish I had this guy for econ 101 blah test on monday
This guy is just awesome!
If the relationship We draw proposes that at any given time some of the industries found within the economy may experience difficulties while others remain stable or strive to economic success, how than can We close Aggregate Demand is the total amount of goods and services demanded in the economy?
thanks mate ur videos help alot
The negative relationship between Aggregate Demand and price level discussed by Investopedia may be cause by fluctuation in price because when faced with Aggregate Demand, prices for goods & services are Not stable. I do not perceive it as described by Investopedia "the total amount of goods and services demanded in the economy at a given overall price in a given time."
Brilliant explanation
Great video, great explanation!
can you be my macro professor
It's pretty sticky to me. In a recession, no company wants to hire another worker, and they do not decrease the wage of the current workers.
nice explanation
Man never ages does he?
very nice reviews, keep the good work
"Artificially low interest rate". Are you sure this makes sense? How is the non-artificial interest rate to be determined when the money supply depends on political decision?
How does the long run aggregate supply curve fit into this combined graph?
aggregate supply in short run for classical and keyesian are the same? just different from long run?
You are so freaking helpful awesome people!!!
A great way to remember is the acronym "KIC". Imagine what happens to a ball when you "kick" it.
dude ur amazing god bless you
on the inflation video you drew for inflation, an economy operating further to the right than lras. and as i understand a classical economist view is that price is only inelastic in the short run. on the graph with both keynesian and classical you say an economy can increase supply past that straight line, which contradicts your earlier video. epalin please
Price is very sticky. Inflation in US is generally 1 to 3%. If the wage is 100 dollars in 2011, the 2012 wage is 101.85. That looks like it's very sticky. We didn't see a 10% rate drop in wage since we have 10% unemployment. Keyne is right.
Extremely helpful
If We can draw a comparison between Stable Demand VS. Aggregate Demand then We should be able to derive at a different conclusion. Aggregate Demand is affected by an outside force, such as natural disaster, war, political conflict, Stable demand does Not.
Great lessons..would you say that that in the case of where the economy has surpassed full employment level that deflation at this stage is a good thing as it is bringing the economy back to equilibrium?
for better or worse, many workers have wages protected by unions, which contributes to wages being sticky downward. for this reason, Keynesian theory has applications in the 'real world'
Like this guy, second only to my teacher, Mr. Styers
awww your teaching way is so cool, lol. Thanks for your video! You're great! Wish I was in your class! ^_^
You do realize that efficient free market theory is astonishingly *constrained*, don't you?
Complete information, no barriers to entry/exit, unlimited buyers and sellers, zero transaction costs, perfect substitutes, no externalities -- name a single market where the aforementioned criteria are met, in reality. Where is this magical world of price-takers?
Aggregate Demand:
Demand cause prices to rise when total “Aggregated demand" increase because of an Overall Reduction in Supply, a Natural Disaster OR Political Conflict that Triggers an Elevation in Price Prediction. Aggregate Demand is not the same as stable demand.
Aggregate demand carries within its development an intensity that is fueled by survival necessities when the cause of demand (natural disaster) produces a diminishing supply.
Thank you professor!!!!!!
When do you improve Runcorn Cheshire?
Thank you so much this was SO helpful (:
I enjoyed the video. I still think something is missing in keynesian theory. Why are prices sticky? What keeps them sticky? I believe that this part of keynesian theory is mistaken, though, I'm not sure how keynesian theory arrived at that conclusion.
lol, because of things like minimum wage, employment contracts etc
Petr D minimum wage and employment contracts are set for a period of time but that is only a small part of what makes up the entire economy and drives prices. Look at grocery stores and clothing stores etc. Their prices are constantly fluctuating.
at some point in economics,we deal with perfectly competitive market situations which ain't really realistic and at that point,we employ ceteris paribus.
people live paycheck to paycheck. The have fixed expenses, like housing , car payments, insurance, etc. So they can't just take a pay reduction because the economy is suffering. So businesses, layoff workers instead.
I assume I'm pretty late but well the simple answer to that is Keynesian theory is relative in short run and that's why prices are sticky while classical theory is based on long run.
Life saving video
What does it mean price and wages are sticky
Really? Is the AS curve like the one in the last graph? SO WHY DO YOU ALWAYS DRAW IT AS STRAIGHT UPWARD DIAGONAL IN THE REST OF THE VIDEOS????
"Sticky" wages and prices are not a "fallacy." Things like minimum wage laws and labor unions, which fight and lobby for higher wages for workers, make it harder for wages to naturally go down. In fact, the "government subsidizes items" and gives "people free money" because wages and prices have NOT gone down, making it harder for people to afford things. If you really think the Great Depression lied about prices being sticky, good luck on your AP test...
@HardCoreProgrammer1 so why it doesn't work?
ACDC is there your video on IS LM curves pllzzzzz tell me i dont wanna fail
True I forgot about that imagine having 50p an hour right now still mixed is better I say.
Ok so what about the upward sloping AS curve? What's that all about? What view/perspective? I'm getting confused with all the AS curves.. *criesss*
What would be the difference in these models in short run and long run?
Classicals don't see a difference. Keynes agrees with the classicals for the long run, but said that in the long run we are all dead, and came up with his version to explain the SR
thanks!
Keynesian theory hinges on the fallacy that wages and prices are "sticky". If they were sticky, Keynesian economics would be logical. In that sense, it does make sense. But in the real world, prices and wages are not sticky, at least not in a true free market. When the government subsidizes items, gives people free money, and sets an artificially low interest rate, the market will not react in the way it would naturally, which is with lower prices/wages. A free market needs to actually be free.
@johammbass you don't know much about actual economics. $1 taken out in taxes is taken from both household S and C, but $1 in G ALL goes back into the economy. you are assuming an MPS of .625 which has a KCM of 1.6--that would mean every $1 in taxes takes only 40cents out of the economy, while every $1 in G increases GDP by $1.6. and when government raises taxes and slows spending it does to so to slow the economy down and reduce inflation. it's called a cyclically balanced budget.
amazing!
This was so very helpful, but honestly you talk entirely too fast. Pausing and rewinding turned this video into 10 minutes for me.
Play it at .75x speed
thank you so much wow
Nice
So let's continue your thought of free market. You would want to eliminate Fiscal and Monetary policy aswell? I mean, free market should take care of that aswell right?
I would be horrified in an economy based on free market without fiscal and monetary influence from knowledged higher agencies.
Here is why: Economics is a science based on humans, which makes it a statistical science. We cannot predict what humans will do. Without Fiscal/Monetary policy I dont want to know what can happen 1%.
it doesnt have sound
Stimuluses are not an ideal tool, but they are better than doing nothing at all. The free market works in an ideal world, but unfortunately we do not live in such a place. Although there may be pay cuts, at least today, prices remain high due to higher global demand from emerging economies like China. In a recession, prices climb less steeply at best. You simply won't find goods and services cheaper today in recession than in the early 2000s. Spending won't magically rise.
Now I see what I'm studying.. omg economics is not so easy like they told me...