Economics Professor Published in Journal of Economics and Finance Education
Dr. Gary Maggs, Professor of Economics, has coauthored a paper with Dr. Ben Kyer of Francis Marion University that has been accepted for publication in the Journal of Economics and Finance Education.
The paper is titled, "Macroeconomic Hydraulics Reconsidered: Teaching Leakages and Injections from the Classical Perspective" and offers a pedagogical alternative to the familiar water hydraulics metaphor of Keynesian 'income leakages' and 'expenditure injections' based on the Classical school of macroeconomics.
In doing so, the paper posits that the Classical analysis provides a mirror image of the Keynesian approach, i.e., where the outflows that are considered leakages in the Keynesian system can be shown as injections in the Classical bond market. The paper also shows that a disequilibrium in the bond market causes bond prices to move in a direction precisely opposite to that of real gross domestic product when a similar goods market disequilibrium occurs.