1) Feel free to use the attached picture in any way you wish. It is
the first illustration in the essay about our economy I composed.
2) I would be happy to show the essay (about 10 pages) to a person
willing to read and to criticize it, especially with an economist. Let
me know.
P.S. Here is the beginning of my essay:
Notes on Macroeconomics (April 2, 2009)
Ludwik Kowalski (kowalskiL@mail.montclair.edu)
Introduction
1) I am a retired physics teacher who wants to learn about
macroeconomics. This essay is based on what I learned recently (and
very superficially) from several textbooks. As most teachers know,
preparation of lecture notes is usually a very effective method of
learning. With this in mind, I will pretend to be a teacher of
economics. My virtual students are taking an introductory course and I
was ordered to teach them, in the best way I can. It is a pedagogical
exercise for me; I want to explain basic principles as clearly as
possible. I hope to benefit from my experience teaching physics.
2) Why are paragraphs numbered? Because I am counting on help from
real economists (willing to correct my errors and to suggest ways
improve this draft). Numbered paragraphs should facilitate the
process. Note that my e-mail address is shown above.
Diagram and basic terminology
3) The diagram representing our economy is shown in Figure 1. The box
labeled “firms” refers to thousands of shops, factories, restaurants,
etc. The box labeled “households” refers to millions of families.
Households deliver workers (“labor”) to firms and receive “wages.”
Firms sell “goods and services” to households at specified “costs.”
The box labeled “banks” refers to thousands of banks. Households often
use banks to save money while firms often use banks to borrow money.
The box labeled “Government” stands for local and state governments,
and our federal government. Governments collect taxes and provide
services.