macroeconomic real world examples

🇺🇸 United States – COVID-19 Stimulus Packages (2020–2021)

Syllabus Topics Covered:

• Fiscal Policy: Expansionary measures to combat recession.

• Unemployment: Addressing cyclical unemployment.

• Economic Growth: Short-run growth through increased aggregate demand.

• Inflation: Demand-pull inflation resulting from stimulus.

• Multiplier Effect: Impact of government spending on national income.

Key Statistics:

• Stimulus Spending: Over $5 trillion across multiple packages, including the CARES Act and the American Rescue Plan.

• Unemployment Rate: Peaked at 14.8% in April 2020, declining to 3.6% by March 2022.

• Inflation Rate: Reached 9.1% in June 2022, the highest in four decades.

🇹🇷 Turkey – Currency Crisis and Inflation (2018–2023)

Syllabus Topics Covered:

• Monetary Policy: Unorthodox approaches leading to economic instability.

• Inflation: Combination of cost-push and demand-pull factors.

• Exchange Rates: Significant currency depreciation.

• Interest Rates: Impact of low rates amidst high inflation.

Key Statistics:

• Inflation Rate: Surged to 85% in October 2022.

• Interest Rate: Central bank rate reduced to 8.5% in 2023, despite soaring inflation.

• Currency Depreciation: Turkish Lira lost over 80% of its value against the USD between 2018 and 2023.

🇯🇵 Japan – Deflation and Aging Population (1990s–Present)

Syllabus Topics Covered:

• Deflation: Persistent price level declines.

• Demographics: Impact of an aging population on the economy.

• Monetary Policy: Use of negative interest rates.

• Public Debt: High debt-to-GDP ratio implications.

Key Statistics:

• Population Over 65: Constitutes 28.7% as of 2023.

• Interest Rate: Maintained at –0.1% since 2016.

• Debt-to-GDP Ratio: Exceeded 260% in 2023, the highest among OECD countries.

🇰🇪 Kenya – Infrastructure Investment and Development Goals

Syllabus Topics Covered:

• Economic Development: Infrastructure's role in growth.

• Foreign Direct Investment (FDI): Influence on domestic projects.

• Sustainable Development Goals (SDGs): Progress in education and infrastructure.

• Supply-Side Policies: Long-term growth strategies.

Key Statistics:

• Standard Gauge Railway (SGR): $3.6 billion project completed in 2017, 90% financed by Chinese loans.

• GDP Growth: Averaged 5.6% between 2015 and 2019.

• Primary School Enrollment: Achieved over 90% enrollment in 2020.

🇪🇺 Eurozone – ECB Interest Rate Hikes (2022–2023)

Syllabus Topics Covered:

• Monetary Policy: Tightening to control inflation.

• Inflation Targeting: Central bank strategies.

• Phillips Curve: Trade-off between inflation and unemployment.

• Exchange Rates: Effects of policy on currency value.

Key Statistics:

• Interest Rate Increase: From –0.5% in July 2022 to 4.5% by September 2023.

• Inflation Peak: Reached 10.6% in October 2022.

• Euro Appreciation: Strengthened from $0.96 in September 2022 to $1.08 in early 2024.

🇨🇳 China – Tariffs on U.S. Agricultural Goods (2018–2020)

Syllabus Topics Covered:

• Trade Policies: Implementation of tariffs.

• Supply and Demand: Market responses to trade barriers.

• Inflation: Potential cost-push effects.

• Aggregate Demand and Supply (AD-AS): Macroeconomic impacts of trade disputes.

Key Statistics:

• Tariffs Imposed: 10% on U.S. soybeans and other agricultural products.

• U.S. Agricultural Exports to China: Declined by over 50% between 2017 and 2019.

• Soybean Prices: Decreased by approximately 20% in 2018 following tariff announcements.