Macroeconomic balance

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The Macroeconomic balance is a term used in economics . In the model of the simple economic cycle , which depicts the economic exchange between the two poles of producers (companies) and consumers (households), it can be shown that an economy is in equilibrium exactly when the rule

National income = GDP is valid.

formula

Macroeconomic Imbalances

In this context, macroeconomic problems and economic measures in macroeconomic equilibrium can now be explained.

Macroeconomic Equilibrium:

I: Private investment
S: Private saving
G: Government spending
T: Taxes
X: Export
M: Import

interpretation

From an economic point of view, the three expressions in brackets can be explained as follows:

(IS): Is the difference between private investments ( excess expenditure = credit debt ) and private saving (excess income, financial assets, savings).
(GT): Is the difference between government spending and government revenue ( budget balance ).
(XM): Is the difference between export and import ( current account balance ).

Inference

Balance: expenditure = income

Because lending results in income for other economic units, individual economic units can only create financial assets, money savings (S), if a complementary group has previously borrowed the same amount (I => S). This means that the ideal of macroeconomic equilibrium will only be achieved if there is no waiver of expenditure (S), i.e. if all of their income is voluntarily and completely spent again.

Stability and Growth Pact

The Stability and Growth Pact of the European Union , which has been expanded to include the so-called six-pack , contains a so-called scoreboard with indicators that are intended to warn of disruptions in the macroeconomic equilibrium.

Individual evidence

  1. Deutsche Bundesbank: Lending and the associated money creation therefore tend to lead to investments ... ( Memento of the original dated February 3, 2013 in the Internet Archive ) Info: The archive link was automatically inserted and not yet checked. Please check the original and archive link according to the instructions and then remove this notice. (PDF, p. 78) Retrieved January 27, 2013. @1@ 2Template: Webachiv / IABot / www.bundesbank.de