New-Keynesian Economics Tales with Algebraic Notations

17 Pages Posted: 28 Mar 2014

Date Written: March 26, 2014


In this paper are outlined some new-Keynesian economic models along with their micro foundations. At first small model of interest rate consumption income and savings has been outlined. Modigliani-Miller model follows as one of the five neutralities in macroeconomics, and demand for money by Miller and Orr. Also Baumol-Tobin models with its extensions by Jovanovic and Romer has been subject to investigation. Issues in monetary policy such as printing money and government revenues of printing money are been subject to discussion too. In the last section Diamond-Dybvig model on bank runs is being outlined.

Keywords: New-Keynesian economics, interest rate, monetary policy, money demand, bank runs

JEL Classification: E12, E60, E50

Suggested Citation

Josheski, Dushko, New-Keynesian Economics Tales with Algebraic Notations (March 26, 2014). Available at SSRN: or

Dushko Josheski (Contact Author)

University Goce Delcev ( email )

+389 32 550 000 (Phone)
+389 32 390 700 (Fax)


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