Figure 17: Keynesian Boost
The model parameters are:
Description | Value |
Bank (reserves) | 20 |
Household loans | -100 |
Business loans | -100 |
Wages rate (as % buiness loans) | 25% |
Bank loan rate | 4% |
1. Boost business loans by -12.5 every year for four years
2. Sticky wages = Business loans *0.25, or 25, whichever is greater