Macroeconomic Goals 2013


28 Οκτ 2013 (πριν από 4 χρόνια και 6 μήνες)

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Macroeconomic Goals

How are we doing? (Survey 2011)

Common Goals for all Economies

Full Employment

Economic Growth

Stable Prices

I. Full Employment

Goal: 5
6 percent unemployment

“Full” employment means hitting the long
average, called the
target, or natural rate
unemployment. (5
6 percent)

In order for unemployment to decrease 1 one
percent, the economy must grow an extra 2
percent. (
Okun’s rule of thumb

The current rate of unemployment is . . .

Full Employment (cont’d.)

About 7.8 percent. (December 2012)

At the current rate of growth, it will take

3+ years to return to the long
run natural
rate of unemployment.

Unemployment November 2011

Unemployment in Other Countries

Unemployment in Other Countries, cont’d

II. Economic Growth

Goal: 3 percent growth

Measured by tracking the changes
Gross Domestic Product (GDP)

Current rate of GDP growth is less
than 2 percent (2012)

III. Stable Prices


3 percent

inflation rate

how is
it measured?

Different indexes:



GDP deflator

NOTE: The Federal Reserve goal is 2
percent inflation

Inflation Rate 2000


More Recent Inflation Rates

Three Questions . . .

What macroeconomic goals are all
economies trying to achieve?

In the U.S., what are the “ideal”
target numbers for those goals?

In which of the goals is the U.S.
currently operating closest to, and
farthest from its target levels?