Even if the IS-LM model is one of the backbones in the Keynesian economics, its explanation in textbooks has a few conceptual as well as expressional errors. Take the demand for money (Md) for example. Almost all textbook authors, including Keynes himself, explain that Md increases as the...

The market economy has three pillars: voluntary exchange, purposive rules of the game, and the rule of law. According to classical works by Smith, Rousseau, Hayek and Friedman followed by empirical research by various contemporary economists, the common law system is more conducive to the rule...

Korea will have hosted 13 international mega-events by 2018. The rationale for attracting an event to Korea is often its economic impact, namely, induced production, income, and employment effects. These effects are estimated by one of the state-run research institutes using the Leontief...

One reason many college students shun economics is ineffective education. A more systematic way of explanation, with standardization and consistency, would promote learning of economic theories. This paper suggests a new framework for effective economics education. It begins with clear...

Korea's economic growth in the Development Era (1962~1996) was phenomenal. However, the growth was largely financed by debt capital: net capital inflow from abroad for the whole economy and bank loans for industrial firms. Overall demand for loans was so huge that various abnormal techniques,...

Macroeconomics is in total disarray. First, a wrong metric is used. Aggregate welfare of the people must not be measured with the gross domestic products, but with their consumption utilities. Second, various models of markets are erroneously suggested as bases of macroeconomics by influential...

The aggregate trade in the market in a community must be accounted for per period of time. As such, the market consists of “flows.” Specifically, the flow of quantity traded is determined after interactions between the two flows of demand schedule and supply schedule; the former slopes...

Abstract. By definition, a stock such as “money supply (Ms)” is the consequence of human actions, never the cause. Nonetheless, an “unusual change” in the stock (ΔM/ΔT) can affect household activities yet to be made. Somehow macroeconomists use them interchangeably, and take a stock as...

In popular explanations of markets, there are discrepancies to be corrected. First of all, market trade means flows and its outcome should not be determined by a stock quantity. Second, market demand is not to be defined by the opportunity cost. Third, money is merely a medium of exchange, not...

Economics might well encompass the asset market, which in turn requires completely new narratives. In addition, money may well be given the single function of the medium of exchange. Then, the defective IS-LM model can be replaced by more logical and simpler explanations: incremental money...