So, there would be a corresponding "negative linkage" to the unemployment rate?
Peter Hollings -----Original Message----- From: PEN-L list [mailto:[EMAIL PROTECTED] On Behalf Of Perelman, Michael Sent: Tuesday, August 23, 2005 5:33 PM To: PEN-L@SUS.CSUCHICO.EDU Subject: Re: [PEN-L] query What about just positive linkages? Michael Perelman Economics Department California State University michael at ecst.csuchico.edu Chico, CA 95929 530-898-5321 fax 530-898-5901 -----Original Message----- From: PEN-L list [mailto:[EMAIL PROTECTED] On Behalf Of Jim Devine Sent: Tuesday, August 23, 2005 2:45 PM To: PEN-L@SUS.CSUCHICO.EDU Subject: [PEN-L] query all sorts of things typically rise with GDP, including business optimism, profitability, cash flow, the ratio of business income to debt, the ratio of sales to industrial capacity, and the degree of uncertainty. All else constant, the combination of these rises encourages fixed business investment to rise. What should I call this connection? Currently, in the textbook I'm helping to write, I call this the "prosperity effect" on fixed investment. Is there a better name that anyone can think of? (I used to call it the "accelerator effect," but that gets confused with the accelerator theory.) -- Jim Devine "living a life of quiet desperation -- but always with style!"
