Macroeconomics Paper

Final Essay

Donald J. Trump was elected as the 45th president of the USA in 2016. This essay will have two parts:

Part 1 – The role of inequality in President Donald Trump’s election (around 250 words)

Discuss the role of inequality (in income and/or wages and/or wealth) in Donald Trump’s election. See suggested readings below. You must include at least one graph in this section and that graph must come from EPI (see www.epi.org). No more than two graphs can be included in this section.

Part 2 – Trump’s policies (around 1250 words)

• Using the Keynesian multiplier model (see handout), show and discuss the possible impact that one or more of Donald Trump’s policies may have on the US economy.
• This might include one or more of the following policies: taxes, government spending, interest rate, protectionism, business confidence, inequality, and consumer confidence. You can focus on one or two policies and go in some detail. Or discuss several in less detail.
• Organize your arguments around graphs and equations, which you will need to draw the multiplier graphs in your essay showing the impact of the policy in the Keynesian model. How does it shift the curves? Detail the exact impact, writing out the equation for the multiplier and how it will shift incomes based on the MPC.
• The essay can be no longer than 1,500 words (all inclusive). You will be penalized heavily for going over the word count even slightly.

Resources for Essay (* = compulsory to read and cite)

On Inequality and the US economy

http://www.epi.org/publication/understanding-the-historic-divergence-between-productivity-and-a-typical-workers-pay-why-it-matters-and-why-its-real/ *

http://www.epi.org/publication/income-inequality-in-the-us/ *

https://www.ft.com/content/98ce14ee-99a6-11e5-95c7-d47aa298f769 * – Sign up to the FT for a free trial to be able to access this article. If you still are unable to please let me know.

http://www.pewresearch.org/fact-tank/2014/12/12/racial-wealth-gaps-great-recession/

http://fivethirtyeight.com/features/the-economic-challenges-facing-the-next-president/

http://inequality.org/income-inequality/

http://inequality.is/

http://inequality.stanford.edu/

On who voted for Trump

http://www.nytimes.com/interactive/2016/11/08/us/elections/exit-poll-analysis.html

http://www.nytimes.com/interactive/2016/11/08/us/elections/how-trump-pushed-the-election-map-to-the-right.html

On Trump’s economic policies

http://www.economist.com/blogs/freeexchange/2016/11/global-economy

http://www.nytimes.com/2016/11/10/upshot/the-trump-administration-could-test-whether-deficits-help-the-economy.html?rref=collection%2Fsectioncollection%2Fupshot

Other material from the Financial Times will be uploaded for you to read.