Chapter 9
The IS-LM/AD-AS Model: A General
Framework for Macroeconomic Analysis
總體均衡分析 : IS-LM 與 AD-AS 模型
IS-LM 在(所得 , 利率)平面上的總體均衡分析
AD-AS 在(所得 , 物價)平面上的總體均衡分析
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
Learning Objectives
I. Goals of Chapter 9
A) Combine the labor market (Chapter 3), the goods market
(Chapter 4), and the asset market (Chapter 7) into a
complete macroeconomic model (for a closed economy)
B) Although the IS-LM model was originally a Keynesian
model because it assumes prices are fixed, by allowing
prices to adjust, it’s possible to use the IS-LM framework
to discuss the classical approach
C) Using one model for both approaches (the classical model
in Chapter 10 and the Keynesian model in Chapter 11)
avoids the need to learn two different models and helps
show clearly both the similarities and the differences of the
two approaches

Teaching Notes
討論勞動市場、商品市場與資產市場同時均衡的總體均
衡
I. The FE Line: 勞動市場均衡的產出、利率組合(Sec. 9.1)
A) In the discussion of the labor market in Chapter 3, we
showed how equilibrium in the labor market leads to
employment at its full-employment level N and output at
Y
B) If we plot output against the real interest rate, we get a
vertical line at Y  Y , 因為實質利率不影響勞動供需因
此 FE 是垂直線(Figure 9.1)
Chapter 9
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155
Figure 9.1
C) Factors that shift the FE line 影響 FE 線位置的因素
Summary 11 lists the factors that shift the full-employment
line
好的 supply shock
－＞
NS 右移
－＞
K 增加
－＞
II. The IS Curve: IS 線：商品市場均衡 (Sec. 9.2)
A) The goods market clears when desired investment equals
d
d
desired national saving 商品市場均衡 I  S
1. Adjustments in the real interest rate bring about
equilibrium
2. For any level of output Y, the IS curve shows the real
interest rate r for which the goods market is in
equilibrium 在(r,Y)平面上繪出所有讓商品市場均衡
成立的(利率，所得)組合點
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3. Derivation of the IS curve from the saving-investment
diagram (Figure 9.2)
Figure 9.2
a. Key features
(1) The saving curve slopes upward because a higher
real interest rate increases saving
(2) An increase in output shifts the saving curve to
the right, because people save more when their
income is higher
(3) The investment curve slopes downward because a
higher real interest rate reduces the desired capital
stock, thus reducing investment
B) Factors that shift the IS curve 造成 IS 線移動的因素
1. Any change that reduces desired national saving relative
to desired investment shifts the IS curve up and to the
right
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157
Figure 9.3
4. Summary 12 lists the factors that shift the IS curve
造成 IS 線右移的因素
an increase in
expected future output 預期未來產出增加
wealth 財富增加
expected future marginal product of capital
預期未來資本財的邊際產出(MPKf) 增加
a temporary increase in government purchases
政府支出暫時性增加
a decline in taxes (if Ricardian equivalence doesn’t
hold)減稅
a decrease in the effective tax rate on capital
資本財的有效稅率降低
III. The LM Curve: 資產市場均衡(Sec. 9.3)
A) The interest rate and the price of a nonmonetary asset
1. The price of a nonmonetary asset is inversely related to
its interest rate or yield 非貨幣資產的價格與利率反比
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B) The equality of money demanded and money supplied
貨幣市場均衡與 LM 線的導出
1. Equilibrium in the asset market requires that the real
money supply equal the real quantity of money
demanded
2. Real money supply(MS=
M
P
) is determined by the
central bank and isn’t affect by the real interest rate
由央行決定與利率無關
Md
3. Real money demand 實質貨幣餘額(MD = P )falls as
the real interest rate rises 根據 Keynes，
Md
 L(Y , r   e ) Y 是所得，r 是實質利率，
P
 e 是預期物價上漲率
Md
MD = P 是所得的正函數，實質利率的負函數
貨幣市場均衡：MS = MD
M Md

P
P
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159
Figure 9.4
7. The LM curve shows the combinations of the real
interest rate and output that clear the asset market
a. Intuitively, for any given level of output, the LM curve
shows the real interest rate necessary to equate real
money demand and supply
b. Thus the LM curve slopes upward from left to right
C) Factors that shift the LM curve 造成 LM 線移動的因素
1. Any change that reduces real money supply relative to
real money demand shifts the LM curve up
a. For a given level of output, the reduction in real
money supply relative to real money demand causes
the equilibrium real interest rate to rise
MS 線右移則 LM 線右移
3. Summary Table 13 lists the factors that shift the LM
curve
a. The LM curve shifts down and to the right because of
造成 LM 線右移的因素
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M S (名目貨幣供給)增加
P (物價水準)降低
 e (預期物價上漲率)提高
其他(非貨幣)資產的相對投資風險降低
其他(非貨幣)資產的相對流動性提高
支付科技的效率增加
4. Changes in the real money supply 實質貨幣供給增加
a. An increase in the real money supply shifts the LM
curve down and to the right LM 線右移
(Figure 9.5)
Figure 9.5
5. Changes in real money demand 例如 預期物價上漲率
降低
a. An increase in real money demand shifts the LM curve
up and to the left (Figure 9.6)
Chapter 9
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161
Figure 9.6
IV. General Equilibrium in the Complete IS-LM Model (Sec.
9.4)一般均衡---勞動、商品、資產市場同時均衡
A) When all markets are simultaneously in equilibrium there
is a general equilibrium
1. This occurs where the FE, IS, and LM curves intersect
(Figure 9.7)
(1)一般均衡必定發生在 IS 線與 FE 線的交點
(2)由物價負責調整、並改變 LM 線的位置，直到三線
交於一點為止
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Figure 9.7
B) Applying the IS-LM framework: A temporary adverse
supply shock 假定發生了暫時性的 supply shock
A 暫時得下跌
1. Suppose the productivity parameter in the production
function falls temporarily
2. The supply shock reduces the marginal productivity of
labor, hence labor demand
a. With lower labor demand, the equilibrium real wage
and employment fall
b. Lower employment and lower productivity both
reduce the equilibrium level of output, thus shifting
the FE line to the left FE 線左移
3. There’s no effect of a temporary supply shock on the IS
or LM curves IS、LM 則不受影響
4. Since the FE, IS, and LM curves don’t intersect, the
price level adjusts, shifting the LM curve until a general
equilibrium is reached 物價開始調整以結清市場
a. In this case the price level rises to shift the LM curve
up and to the left to restore equilibrium (Figure 9.8)
貨幣市場供過於求，則物價將上漲使 LM 線左移
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163
Figure 9.8
5. The inflation rate rises temporarily, not permanently
物價上漲是暫時性的而非永久
6. Summary: The real wage(w), employment(N), and
output(Y) decline 減少, while the real interest rate(r) and
price level(P) are higher 增加
a. There is a temporary burst of inflation as the price
level moves to a higher level 突然發生物價上漲
b. Since the real interest rate is higher and output is
lower, consumption and investment must be lower
消費與投資也降低
V. Price Adjustment and the Attainment of General
Equilibrium 物價調整與一般均衡的達成(Sec. 9.5)
舉例說明為何由物價負責調整以及如何達到一般均衡
A) The effects of a monetary expansion 央行寬鬆貨幣
1. An increase in money supply shifts the LM curve down
and to the right ＝＞M 增加使 LM 線右移
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2. Because financial markets respond most quickly to
changes in economic conditions, the asset market
responds to the disequilibrium 資產/貨幣市場的反應是
最快的，勞動、商品市場都需要較長的調整時間
a. The FE line is slow to respond, because job matching
and wage renegotiation take time
b. The IS curve responds somewhat slowly
c. We assume that the labor market is temporarily out of
equilibrium, so there’s a short-run equilibrium at the
intersection of the IS and LM curves 假定短期均衡在
IS、LM 的交點上，即利率、所得暫時由 IS、LM
的交點決定，而勞動市場暫時失衡(因為勞動市場
的調整最耗時間)
3. The increase in the money supply causes people to try to
get rid of excess money balances by buying assets,
driving the real interest rate down 貨幣供過於求造成 r
下跌＝＞消費、投資需求暫時增加
a. The decline in the real interest rate causes
consumption and investment to increase temporarily
b. Output is assumed to increase temporarily to meet the
extra demand 則廠商面對增加的需求將調高售價
4. The adjustment of the price level
a. Since the demand for goods exceeds firms’ desired
supply of goods, firms raise prices
b. The rise in the price level causes the LM curve to shift
up P 增加將使 MS 變小＝＞LM 左移，直到回到原
均衡為止
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165
c. The price level continues to rise until the LM curve
intersects with the FE line and the IS curve at general
equilibrium (Figure 9.9)
Figure 9.9
結果：所有實質變數 N、Y、r 不變，貨幣供給增加
引起物價發生等比率、同方向之變動(名目變數也
是)
5. Trend money growth and inflation 若貨幣供給持續性
增加＝＞會有類似結果
b. If both the money supply and price level rise by the
same proportion, there is no change in the real money
supply, and the LM curve doesn’t shift
若 MS 和 P 的增加比率相同＝＞LM 不變
c. If the money supply grew faster than the price level,
the LM curve would shift down and to the right
若 MS 增加的速度比物價上漲率快＝＞LM 右移，
無法回到原位
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VI. Aggregate Demand and Aggregate Supply (Sec. 9.6)
AD 線與 AS 線的導出
B) The aggregate demand curve
1. The AD curve shows the relationship between the
quantity of goods demanded and the price level when the
goods market and asset market are in equilibrium
a. So the AD curve represents the price level and output
level at which the IS and LM curves intersect (Figure
9.10)
AD 線是貨幣/商品市場同時均衡時，產出與物價的
組合
Chapter 9
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167
Figure 9.10
b. The AD curve is unlike other demand curves, which
relate the quantity demanded of a good to its relative
price; the AD curve relates the total quantity of goods
demanded to the general price level, not a relative
price
c. The AD curve slopes downward because a higher price
level is associated with lower real money supply,
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shifting the LM curve up, raising the real interest rate,
and decreasing output demanded
2. Factors that shift the AD curve
造成 AD 線移動的因素：例如 政府支出暫時性增加
Figure 9.11
c. Summary Table 14: Factors that shift the AD curve
造成 AD 線移動的因素：
(1) 使 the IS 右移造成 the AD 右移
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169
(a)
Increases in future output (Yf), wealth,
government purchases (G), or the expected future
marginal productivity of capital (MPKf)
Yf 、G、 MPKf 增加
(b)
Decreases in taxes (T) if Ricardian
equivalence doesn’t hold, or the effective tax rate
on capital ()
T 、 減少
(2)
使 the LM 右移造成 the AD 右移
(a)
Increases in the nominal money supply (M)
or in expected inflation (e)
M、e 增加
(b)
Decreases in the nominal interest rate on
money (im) or the real demand for money
名目利率或實質貨幣需求降低
C) The aggregate supply curve AS 線導出
(物價與商品供給之間的關係)
1. The aggregate supply curve shows the relationship
between the price level and the aggregate amount of
output that firms supply
假定廠商的短期行為與長期行為不同，因為價格在短
期固定不變，因此
SRAS 短期 AS 線是水平線；而在長期，因為勞動
市場可達充份就業狀態，就業量 N 不受物價影響，
故 Y  A  F ( K , N ) 也不受物價影響，則
LRAS 長期 AS 線是垂直線
(Figure 9.12)
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Figure 9.12
3. Full-employment output isn’t affected by the price level,
so the long-run aggregate supply curve (LRAS) is a
vertical line at Y  Y in Figure 9.12
4. Factors that shift the aggregate supply curves
使 AS 線移動的因素
a. The SRAS curve shifts whenever firms change their
prices in the short run
使廠商調整價格的因素都將使 SRAS 移動
(1) Factors like increased costs of producing goods
lead firms to increase prices, shifting SRAS up
(2) Factors leading to reduced prices shift SRAS down
b. Anything that increases Y shifts the LRAS curve right;
anything that decreases Y shifts LRAS left
c. Examples include changes in the labor force or
productivity changes that affect labor demand
任何使 Y 改變的因素都將使 LRAS 移動
D) Equilibrium in the AD-AS model
1. Short-run equilibrium: AD intersects SRAS
短期均衡
2. Long-run equilibrium: AD intersects LRAS
Chapter 9
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171
長期均衡
a. Also called general equilibrium
b. AD, LRAS, and SRAS all intersect at same point
(Figure 9.13)
Figure 9.13
c. If the economy isn’t in general equilibrium, economic
forces work to restore general equilibrium both in ADAS diagram and IS-LM diagram
E) Monetary neutrality in the AD-AS model (Figure 9.14 and
key diagram 7) AD-AS 模型下之貨幣中立性
Figure 9.14
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Abel/Bernanke • Macroeconomics, Fifth Edition
1. Suppose the economy begins in general equilibrium, but
then the money supply is increased by 10%
2. This shifts the AD curve upward by 10% (from AD1 to
AD2) because to maintain the aggregate quantity
demanded at a given level, the price level would have to
rise by 10% so that real money supply wouldn’t change
and would remain equal to real money demand
3. In the short run, with the price level fixed, equilibrium
occurs where AD2 intersects SRAS1, with a higher level
of output
4. Since output exceeds Y , over time firms raise prices and
the short-run aggregate supply curve shifts up to SRAS2,
restoring long-run equilibrium
5. The result is a higher price level—higher by 10%
6. Money is neutral in the long run, as output is unchanged
F) The key question is: How long does it take to get from the
short run to the long run?
1. The answer to this question is what separates classicals
from Keynesians
古典學派與凱因斯學派的差異，對於調整至均衡需花
多少時間看法不同