1. Carefully explain the difference between "structural stagnation" and "secular stagnation." Contrast the root causes of "stagnation" in both hypotheses? Discuss the "headwinds" that could lead to secular stagnation as outlined by economist, Robert Gordon.
2. Explain the role of globalization in creating a structural stagnation problem. Discuss the impact on the U.S. economy if the world price for goods is below the U.S. price of goods specifically on domestic employment
Globalization and structural stagnation have affected the employment prospects of various groups in different ways. Referring to the tradable and non-tradable sectors analyze the impact of globalization of the U.S. workforce. Is the occupation that you analyzed in your Introduction Post in the tradable or non-tradable sector? How is it affected by globalization?
3. Outline the policy choices that policy makers have to deal with structural stagnation. Discuss both policies that will shift the World Aggregate Supply (WAS) up as well as policies that will shift the Short-Run Aggregate Supply (SAS) curve down. Are these policies politically feasible? Referring to the globalized Aggregate Supply and Aggregate Demand model what challenges does structural stagnation pose for traditional monetary and fiscal policy which is focused on aggregate demand?
4. Globalization has pulled hundreds of millions of people out of poverty in China and India and other countries in Asia. Global equality appears to be increasing through the "law of one price" and "transferable comparative advantage" as discussed in Chapter 8. How should the convergence of global incomes be weighed against the structural changes (including lower income levels for many workers) that globalization requires in the United States and other developed economies? Should there be a "safety net" for those most hurt by globalization and technological change? What kind of "safety net"? Who should pay for it? Explain.
5. Do you see evidence that economic growth will pick up in the future? Or are we doomed to slower growth for years to come? Utilize economic reasoning to support your answer. What are the consequences if the new normal growth rate is significantly less than the secular trend rate of growth that the U.S. economy experienced in the 20th century?
In addition to answering the post questions completely you should make two thoughtful replies to the posts of other students to receive full credit for your post. In your replies to other students you can expand and or clarify a point made in the posting. Offer an additional suggestion or argument to support a position taken in the posting. Suggest ways in which an idea could be more clearly expressed. Identify passages where you think the writer misunderstood a concept or applied it incorrectly. Disagree with a point or position using economic reasoning. If you are disagreeing with the views of another student, please be constructive and respectful.