News Nature Together With Importance Of Macro Economics
Nature of Macro Economics:
The nature of a dependent area is determined on the Earth of whether a scientific discipline has a purely positive (theoretical) or normative (policy) orientation or both. Influenza A virus subtype H5N1 positive scientific discipline has exclusively theoretical orientation whereas a scientific discipline having normative orientation aims at setting norms for finding solution to practical problems as well as provides policy guidelines Macroeconomics has both positive (theoretical) as well as policy orientations.
Importance of Macro Economics
Lies inward providing a theoretical framework for finding solutions to 3 major macroeconomic problems confronting most countries of the world, viz.,
(i) problems of economical increment ,
(ii) unemployment and
(iii) inflation.
As regards the problems of economical growth, both developed as well as underdeveloped countries convey been striving, peculiarly later the Second World War, to accomplish as well as keep a high increment rate. While industrially advanced nations convey succeeded inward achieving a high increment charge per unit of measurement during the post-war II period, most of them, excepting japan, are withal striving to accomplish a reasonably high increment of the economic scheme as well as to sustain it over a long current of time.
Pre-Keynesian Era: The pre- Keynesian era refers to the current of economical thoughts of classical as well as pre-classical economists. Their macroeconomic idea were inward the forms of for certain ‘postulates’ which tin locomote summarized .If marketplace forces of need as well as render are allowed to convey costless play, i.e., the laissez-faire system, then
(i)there volition ever locomote total work inward the long –run,
(ii) at that spot volition locomote neither overproduction nor under-production and
(iii) the economic scheme volition ever locomote inward equilibrium inward the long-run.
The Keynesian Revolution: The collapse of the classical economic science necessitated a fresh await at the working of the economical organisation as well as devising corrective measures as well as safeguards against the failure of the marketplace economy, it was inward this background that Keynes published his General Theory which pose the foundation of macroeconomics.
Post-Keynesian Development: Until the 1970s, the Keynesian thoughts as well as policies had global appeal as well as application. However, Keynesian economic science started showing signs of failures during the 1970s. This raised the doubtfulness almost the relevance as well as applicability of Keynesian economics. Consequently, several other schools of macroeconomic thoughts emerged, viz., Monetarism, supply-side macroeconomics, New Classical macroeconomics as well as New Keynesianism.
New Classical Macro Economics: During the 1980s, the Keynesian thought was attacked yesteryear about other grouping of economists, called radicalists led yesteryear Robert E. Lucus, the Nobel Laureate of 1995, their views known equally novel classical macroeconomics.
Supply-Side Economics: Another schoolhouse of macroeconomics that emerged meanwhile is called “Supply-Side Economics”. While Keynesians as well as monetarists convey both built their arguments for ‘what determines the aggregate need ’on the Earth of the factors operating on the need side of the market,” supply-side economists’,” led yesteryear Arthur Laffer, emphasized the work of the factors operating on the supply-side of the market.