Research Paper on:
Global Economy and 2 Macroeconomic Problems

Unformatted Sample Text from the Research Paper:
this field can also encompass other aspects of an overall economic picture such as inflation and the business cycle (2002). Current macroeconomic problems facing the US include a sluggish service  sector (Van Biema and Greenwald, 1997). Macroeconomic issues affect the world, as well as the US. Global macroeconomic problems include failing banking  systems; the possible detrimental effects of increased oil prices; the effects of globalization, and the growing unrest due to increasing inequalities of wealth. The following discussion will examine two of  these issues, world banking problems and oil-price increases, and how these problems relate to macroeconomics, as well as possible solutions offered by macroeconomists. Looking at specific problems in macroeconomics is  referred to as "applied" macroeconomics, as opposed to theoretical macroeconomics. Applied macroeconomics is an inexact science. Britton (2002) points out that, in general,  macroeconomists can indicate general tendencies, such as that inflation tends to rise in years when unemployment falls" or that, sometimes, a "rise in interest rates seems to deter consumer spending,"  but, Britton is emphatic that such observations should be regarded as "rules of thumb" rather than as "unchanging laws of nature" (2002, p. 104).  The world has not faced the same degree of wide spread banking problems that it does today since the era of the Great Depression, as there have been  112 instances of systemic banking crises in 93 countries since the 1970s (Peek and Rosengren, 2001). These crises have meant that the countries involved have had to bear considerable economic  and fiscal costs, with the average direct costs of banking collapse being estimated at 12.8 percent of the GDP, and, for many countries, the direct costs exceed this figure (Peek