Introduction to Macroeconomics

By James E Njoroge, M. Sc. (VWL) - Economic Coach, Consultant and Lecturer / October 16, 2024 / Macroeconomics, Economic Policy, Economics, Fiscal Economics, Globalization, Monetary Economics

Introduction to Macroeconomics Read Post »

This article provides a comprehensive introduction to macroeconomics, focusing on its core objectives and the roles of fiscal and monetary policy in shaping economic outcomes. It explores six key macroeconomic objectives—four quantitative (price stability, high employment, foreign trade balance, and steady economic growth) and two qualitative (fair distribution of income and wealth and environmental sustainability). These interrelated objectives emphasize the need for balanced, long-term economic policies that promote growth and equity.

Economics, Fiscal Policy, Globalization, Macroeconomic Objectives, Microeconomics, Monetary Policy, Qualitative Objectives, Quantitative Objectives

Household Optimization Problem

By James E Njoroge, M. Sc. (VWL) - Economic Coach, Consultant and Lecturer / February 22, 2024 / Foundations of Economics, Economic Blog, Economics, Household Economics, Markets, Microeconomics

Household Optimization Problem Read Post »

In this article, you will learn how to formally describe the household optimization problem in your microeconomics. To understand how private households make their consumption and resource allocation decisions in the real world, we shall look at the crucial elements that affect optimal decision-making, e.g., price, income, and preference changes. A private household is one of the primary agents making economic decisions relevant to other economic agents, e.g., government and firms. Here is a revisit of the household maximization problem described in many microeconomic and economics textbooks. But with a clear outline and a better understanding of how households set goals, their opportunity cost optimization process, and the interpretation of outcomes.

Economics, Household, Leisure Consumption, Marginal Rate of Substitution, Maximization, Maximum Principle, Microeconomics, Minimization, Minimum Principle, opportunity costs, Optimization, Private Consumption, Relative Price, Utility

Fundamentals of Microeconomics

By James E Njoroge, M. Sc. (VWL) - Economic Coach, Consultant and Lecturer / August 14, 2023 / Foundations of Economics, Behavioral Economics, Economics, Household Economics, Markets, Microeconomics, Mobility, Technology

Fundamentals of Microeconomics Read Post »

Microeconomics is a branch of economic theory that analyzes the decision-making of economic agents, including private households, firms, and government, in an economy. It factors in environmental conditions and various influences that affect choices related to consumption, production, and resource allocation. Microeconomics also explores how coordination mechanisms and social networks influence the outcomes of these decisions, highlighting possible conflicts between individual options and collective decisions.

Behavior, Behavioral Economics, Collective Household, Economics, Firms, Government, Microeconomics, Private Household

Corona-Crash and the global economy

By James E Njoroge, M. Sc. (VWL) - Economic Coach, Consultant and Lecturer / August 8, 2023 / Global Crises, Behavioral Economics, Economic Blog, Economics of Pandemics, Financial Markets, Globalization, Health Economics, International Economics, Macroeconomics, Markets, Microeconomics

Corona-Crash and the global economy Read Post »

The Corona Crash in March 2020 significantly impacted the global economy, with many businesses forced to shut down and millions of people losing their jobs. Looking back, the stock market experienced a sharp decline, and many industries, including travel, hospitality, and entertainment, were hit hard. The pandemic caused a decrease in consumer spending, as people were either unable or unwilling to leave their homes. This led to a reduction in demand for goods and services, which in turn caused many businesses to suffer. The unemployment rate skyrocketed, and many people struggled to make ends meet. Financial Markets adjust to Corona-Crisis

Corona-Crash, COVID-19, Economic Crisis, Economic of Pandemics, English, Financial Crisis, Financial Markets, Global Economy, Global Health Shocks, Globalization, Health Economics, International Economics, Macroeconomics, Market Crisis, Microeconomics, Pandemic, Stock Markets

Elasticity in Economics

By James E Njoroge, M. Sc. (VWL) - Economic Coach, Consultant and Lecturer / January 6, 2022 / Foundations of Economics, Economic Blog, Economic Policy, Economics, Microeconomics, Public Policy

Elasticity in Economics Read Post »

Elasticity in economics represents the sensitivity of economic parameters like demand, supply, and prices, among others, to changes in affecting factors. It includes price elasticity of demand, which assesses demand changes if prices increase, and income and cross-price elasticity in household theory. Additionally, direct and indirect price elasticity of demand are derived mathematically. Also, firm and market theories apply elasticity to assess the price sensitivity of input demand, production, firm supply, and market representation.

Demand Elasticity, Economics, Elasticity, Household Theory, Market Theory, Microeconomics, Price Elasticity, Theory of the Firm

Production Technology in Economics

By James E Njoroge, M. Sc. (VWL) - Economic Coach, Consultant and Lecturer / November 12, 2021 / Foundations of Economics, Business Administration, Economics, Macroeconomics, Mathematics, Microeconomics

Production Technology in Economics Read Post »

Production technology in economics refers to the sum of all knowledge and capabilities of the society to combine scarce resources to produce final goods for consumption. This concept covers all industrial processes and exchanges within the value chain. The production function is the mathematical interpretation of production technology. Important concepts include the return to scale, the marginal product of inputs, and the change of marginal productivity. These concepts are also applied at both microeconomic and macroeconomic levels. The understanding of production technology requires some mathematical background.

Change of Marginal Product of Inputs, Economics, Inputs, Macroeconomics, Marginal Product of Inputs, Marginal Rate of Technical Substitution, Microeconomics, opportunity costs, Outputs, Production function, Production technology, Return to Scale of Inputs

Motives of Money Demand and Supply

By James E Njoroge, M. Sc. (VWL) - Economic Coach, Consultant and Lecturer / November 3, 2021 / Macroeconomics, Economics, Foundations of Economics, Monetary Economics

Motives of Money Demand and Supply Read Post »

What are the motives of money demand and supply? Most of us participate daily in the money market as demand or even as suppliers without perceiving it. So why do we hold or withdraw money? Let us dig deep into the questions surrounding the functions of money and the motives of money demand in this article. Let us start by defining what money is. What is Money and its Funktions? Whoever wants to understand what money is should first look at the functions of money. Much of macroeconomic literature explains the money functions using three phrases: Learn how to describe

Bank of England, Banking, Central Banks, Economics, European Central Bank, Financial Markets, Functions of Money, Macroeconomics, Microeconomics, Monetary Policy, Monetary Theory, Money, Motives of Money, US Federal Reserve

5 Tips to enhance personal finance and liquidity

By Tommy Gache / September 16, 2020 / Personal Finance, Economic Blog

5 Tips to enhance personal finance and liquidity Read Post »

Here are 5 tips to enhance personal finance and liquidity that are simple and easy to implement in your household. How can you enhance personal finance and liquidity during/after the coronavirus pandemic? According to the OECD, digitalization poses challenges and opportunities to society due to low financial resilience and literacy. With this modern era (amid the pandemic) being so tough on our pockets, we should ensure the meager resources at our disposal are utilized to their maximum efficiency. Read the following 5 tips (easy steps) about how to enhance personal finance and liquidity. Hopefully, they will helpfully accompany your financial

Budgeting, Corona-Crash, Economic of Pandemics, Liquidity, Microeconomics, Pandemic, Personal finance, Saving

Introduction to Macroeconomics

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Household Optimization Problem

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Fundamentals of Microeconomics

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Corona-Crash and the global economy

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Elasticity in Economics

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Production Technology in Economics

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Motives of Money Demand and Supply

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5 Tips to enhance personal finance and liquidity

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Microeconomics

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