Diary of Econ 244, Spring 21

We have the third midterm.

We finish the problem of what to do and with it, the course. Third Homework is due.

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We look at damages and start looking at the problem of what to do.

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We review all the material of the class of Apr 12, given my confusion of being a holiday.

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We look at non-linearities and tipping points (31) and start the carbon cycle.

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We continue with the model of climate change.

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We finish looking at externalities (20). We begin to look at climate change.

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We continue looking at externalities (8).

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We finish social insurance (287). We start to look at externalities.

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We finish Social Security (265). we talk about social insurance.

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We have the second midterm.

We talk about Social Security (247). Second Homework is due (Only up to question 34).

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We look at how our theory accounts for international differences in hours worked.

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We discuss briefly the general result about social welfare functions (slide 211). We look at the problem of a household with consumption, and labor and capital income taxes. We look at the proposition that labor and consumption taxes are the same with and without labor income. We start looking at how our theory accounts for international differences in hours worked.

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Spring break

We talk about a few other properties of the U.S. tax system (including the marriage penalty). We discuss Social Welfare Functions. (slide 213)

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We finish Generational Accounting. We start talking about the U.S. income tax system and its properties such as progressivity and regressivity. (Slide 194).

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We start the Ricardian Propositions and its exceptions: Borrowing constraints, transfers of the tax burden (to the extent that altruism is not operational), and non lump sum taxation (looking for examples of it, like the poll tax or the tax of height). We start looking at The Fiscal Situation in the U.S. and Generational Accounting (166). We go over a summary of Gokhale's Generational Accounting findings.

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We finish uncertainty. We start Part IV, Positive Theory of Government Activity discussing the budget constrain of the government. (Slide 138)

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We have the first midterm. It covers up to what we have seen, including income uncertainty with quadratic utility.

We go over the introduction to income risk. We talk about various issues involved with quadratic utility. The first homework is due. (Slide 125)

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We finish the many period lifemodel including an example and how it fares with respect to the empirical evidence. We discuss various explanations for consumption over the life cycle to be humped shape. We look at constant relative risk aversion preferences. (Slide 117)

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We discuss in more detail taxes in the two period model, including perhaps a discussion of what taxes could be both progressive and non distortionary. We may talk about the fall of labor share and its 3 candidate explanations. We start with Part II, the life cycle model. (100)

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We go over the General Equilibrium Overlapping Generations Model. We also discuss the effects of a labor income tax and rebate and of a consumption tax and rebate. (Slide 80)

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We review the proposition of welfare consequences of interest rate changes. We discuss bankruptcy and some properties of the U.S. bankruptcy code. We talk about some of the problems of measuring GDP. We start looking at the general equilibrium model (the two period Overlapping Generations Model). We discuss a the steady state (capital, wages, interest rate, consumptions). We look at dynamics. We look at population growth. (To 78)

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We discuss comparative statics, solving the model with perfect borrowing. I ask you to look at the proposition of welfare consequences of interest rate changes. We look at borrowing constraints. (slide 57)

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I continue the two period model with the constraints, the first order conditions and discussed the guarantee of a unique solution. I go onto the graphic description of the problem and performed comparative statics exploring the response of choices to changes in endowments and interest rates. (slide 43)

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I finish with the facts (cyclical behavior, debt). I start the two period model with the description of the objective function (slide 35).

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We go over the rules of the course and some of the facts of the U.S. Government sector (slide 19).