@karstenkohler
Associate Professor in Economics @ University of Leeds. Macroeconomics & finance. Capital flows, exchange rates, financial cycles, financialisation, income distribution. https://karstenkohler.com https://macrosimulation.org
March together !
Join our bloc at the @UKTogetherAll march on 28 March! 🙌
Assemble 12pm, Block C. Find us on what3words: ///patrol.cone.pulse
March with us against the far right ✊
Full route info: togetheralliance.org.uk
Over 1000 civilians dead, and we're letting Trump use UK bases to further his war.
Britain should stand firm against Trump's illegal warmongering, and stop these bombers landing on UK soil.
Palestine action
UCU is deeply concerned by the length of time people connected to alleged actions involving Palestine Action are being held on remand.
Read the full statement 👇
In case you're teaching the Solow model this semester, check this out 👇
New section on the DIY Macroeconomic Model Simulation Website: The Solow Growth Model
macrosimulation.org/a_solow_model (1/5)
While arguably of very limited real-world relevance, the Solow model is still widely taught. The section provides a detailed numerical and analytical discussion of a continuous-time version of the model, which might be helpful for teaching and learning. (6/6)
When introducing exogenous labour-saving technical change, the model generates per-capita output growth also in the long run. (5/6)
The production function exhibits constant returns to scale but diminishing marginal returns to its individual inputs. As a result, it only generates long-run growth in total output, but not in output per capita, which only grows during the adjustment towards the steady state. (4/6)
The model considers a supply-driven growth process with a neoclassical aggregate production function with capital and labour as substitutable inputs. There is no independent investment function: all saving is automatically invested. (3/6)
The section shows how to simulate in R / Python the canonical neoclassical growth model due to Solow (1956) (2/6).
New section on the DIY Macroeconomic Model Simulation Website: The Solow Growth Model
macrosimulation.org/a_solow_model (1/5)
To reiterate, this is about making life immeasurably more miserable and stressful for some of the most vulnerable people, in the almost certainly vain hope of winning over the votes of racists.
Anything more shabby and shameful is difficult to envisage.
Interestingly, this is not true. Nice example of one of the central analytic pitfalls in this area, confusing net flows with gross ones.
ICYMI 👇
New section on the DIY Macroeconomic Model Simulation Website: A Stock-Flow Consistent Model of the Monetary Circuit.
https//macrosimula... (1/5)
ICYMI 👇
Personal note: went to (some) of the countermarch yesterday, and then watched TV coverage of both.
@sundersays.bsky.social is right that the far-right/racists on the main march are a (small) minority whose numbers are not growing.
It's the apparent paralysis of the majority that scares me. [1/n]
The section provides a detailed numerical and analytical discussion of the model, including how to construct balance sheet and transaction flow matrices, and a simple recipe for building SFC models. (5/5)
It shows how changes in aggregate demand drive credit and money creation, and how shifts in liquidity preference can impact bond markets. (4/5)
The model illuminates the process by which economic production is financed, incorporating the ideas of endogenous money creation and price determination in financial markets. (3/5)
The section shows how to simulate in R / Python a stock-flow consistent model that captures key ideas of Augusto Graziani’s monetary circuit. The model is an extended version of Wynne Godley’s 2004 paper:
link.springer.com/chapter/10.1... (2/5).
New section on the DIY Macroeconomic Model Simulation Website: A Stock-Flow Consistent Model of the Monetary Circuit.
https//macrosimula... (1/5)
New working paper with @jomichell.bsky.social and Ayoze Alfageme: "An analytical heterogeneous agent macro model of concentration, markups, and falling labour shares" papers.ssrn.com/sol3/papers.... (1/7)
New post: Reform and the UK press
mainlymacro.blogspot.com/2025/08/refo...
We have reached the point where a majority of the print media are in effect encouraging civil unrest and racial hatred, yet thanks to political short termism this press remains essentially unaccountable for their behaviour
UK academics - please sign this open letter to the UK government: Request for biometric deferral and safe evacuation of incoming Palestinian students and scholars from Gaza to UK Universities
docs.google.com/forms/d/e/1F...
Despite its simplicity, the model captures key empirical patterns related to superstar firms and declining labour shares. (7/7)
These dynamics lead to right-skewed distributions, producing a divergence between the average profit share across firms and the aggregate profit share, which is driven up by the biggest firms. The fall in the labour share reduces consumption and slows down growth. (6/7)
At the same time, customers seek lower prices, creating competitive pressure. These mechanisms drive endogenous changes in the firm size distribution. More profitable firms temporarily grow faster, leading to concentration of capital, market shares, and markups. (5/7)