Total value produced. GDP is the standard aggregate, useful for level and direction, but incomplete on distribution and unpaid work.
Macroeconomics
A systems atlas for output, labor, prices, credit, and policy: how aggregate outcomes form, move, and break.
Orientation: What macro is actually observing
Macroeconomics tracks the economy at the level where composition effects dominate: output, employment, prices, interest rates, and external balances.
Micro asks why one household or firm changes behavior. Macro asks why millions shift together, and why those synchronized shifts can produce recessions, inflation regimes, and policy constraints.
The core reason the field exists is aggregation. What is prudent for one balance sheet can be contractionary for the system as a whole. Macro analysis starts where that tension becomes visible.
Once the level is clear, the next question is motion: where the cycle is, what is being measured, and what is changing first.
Cycle and Measurement
Read cyclical position first, then map changes through a stable set of aggregates.
Business Cycles and Time Horizons
Macroeconomic change is not linear. Economies expand, slow, contract, and recover in recurring phases. The same shock can look different depending on whether you read it over quarters, years, or decades.
Expansion
Spending firms, hiring broadens, and inventories rebuild.
Hover or focus a phase
Quarters to ~2 years
The Short Run
Demand drives the action. When spending falls sharply, output and employment drop before prices adjust. This is where recessions happen and policy responds.
~2 to 10 years
The Medium Run
Prices and wages catch up. Inflation expectations settle or shift. Policy mistakes from the short run start showing their cost.
A decade+
The Long Run
Supply sets the ceiling. Technology, institutions, and demographics determine how much the economy can produce. The question shifts from stabilization to growth.
Core Measures
Most macro diagnosis starts from four aggregates that anchor policy and model interpretation.
The share of people who want work and cannot find it. Headline unemployment is informative, but broader labor underuse can move differently.
Inflation, deflation, and stagflation all describe changes in the price level, but each points to a different macro environment and a different policy problem.
The stock of money and near-money in circulation. Monetary aggregates matter through credit conditions, portfolio choices, and spending behavior.
After measurement comes propagation: how a local shock travels through institutions, prices, jobs, and balance sheets.
Who Moves the System
Aggregate outcomes are produced by institutions, not abstractions. These five actor groups are where macro decisions are made and transmitted.
Households
Consume, save, supply labor
Firms
Produce, invest, hire
Government
Tax, spend, regulate
Banks & Financial Markets
Create credit, set rates, allocate capital
Global Flows
Trade, capital movement, exchange rates
How the field took shape, and where its major disagreements begin.
A Short History of Macroeconomics
Macroeconomics was built in crisis, revised in failure, and argued over ever since.
Pre-1936
Before the field
Classical frameworks assumed markets self-correct quickly. The Great Depression exposed prolonged aggregate failure.
1936-1970s
The Keynesian revolution
Keynes reframed downturns as demand failures that can persist. Fiscal stabilization moved to the center of policy design.
1970s-2000s
Monetarism and rational expectations
Monetarist and rational expectations critiques challenged discretionary fine-tuning and rewired modern policy models.
2008-present
After 2008
Financial fragility, secular stagnation, and unconventional policy tools reopened core macro questions.
Competing lenses on one economy
The schools differ on what matters most, what adjusts slowly, and what policy can fix.
Four mainstream schools diagnose one economy from different mechanisms. Then the heterodox family extends the debate by challenging core assumptions about money, power, institutions, and growth.
Click any school name to open its page.
Mainstream lens
Keynesian
Demand shortfalls cause recessions; fiscal and monetary policy should actively stabilize the economy.
Common ground
Demand weakness and policy still matter.
Main dispute
Demand shortfalls vs. nominal discipline.
Mainstream lens
Monetarist
Inflation is primarily a monetary phenomenon; stable money-supply growth matters more than fine-tuned intervention.
Common ground
Expectations and rule credibility matter.
Main dispute
Demand shortfalls vs. nominal discipline.
Mainstream lens
New Classical
Markets clear more quickly than Keynesians allow, and systematic policy cannot reliably surprise the economy into producing more.
Common ground
Expectations and rule credibility matter.
Main dispute
Weak self-correction vs. fast adjustment.
Mainstream lens
New Keynesian
Markets are forward-looking but still imperfect; sticky prices and wages give policy real short-run effects.
Common ground
Demand weakness and policy still matter.
Main dispute
Rigidities vs. frictionless adjustment.
Connected critique family:Heterodox
Heterodox family
Heterodox
A family of approaches that questions one or more core mainstream assumptions about equilibrium, money, power, or growth.
Common ground
Markets can remain unstable without active support.
Main dispute
Power, institutions, and money are not side details.
Post-Keynesian
Money is endogenous, uncertainty is fundamental, and equilibrium is the exception, not the rule.
Main dispute: Pushes back on loanable-funds thinking and on the assumption that the economy naturally settles into equilibrium.
Marxian
Capitalism's dynamics are driven by class conflict, profit pressure, and recurrent crises.
Main dispute: Pushes back on harmony stories that treat crises as temporary frictions rather than recurring features of the system.
Institutionalist
Economic outcomes depend on laws, norms, firms, and the institutional structure around markets.
Main dispute: Pushes back on abstract market models that strip away the institutions doing the real coordinating work.
Feminist
The economy rests on unpaid care work and gendered power relations that standard macro measures often ignore.
Main dispute: Pushes back on production-only models that erase unpaid labor and treat distribution inside households as irrelevant.
Ecological
The economy is a subsystem of the biosphere, so growth must be judged against physical and environmental limits.
Main dispute: Pushes back on growth frameworks that treat the environment as an externality rather than a binding condition.
Modern Monetary Theory
A currency-issuing government cannot run out of its own money; inflation, not finance, is the real limit.
Main dispute: Pushes back on household-budget analogies for sovereign governments and on deficit debates framed as financing problems.
Have your own unique question and theory?
Master the fundamentals
Simple textbook descriptions of the macroeconomy involving a small number of equations or diagrams. See the visualizations, and master the mathematical proofs
Explore real world data
Browse available indicators, track them, or use them in your economic questions
Indicators
Browse macro series from official sources and assemble the signal set that fits your question.
Browse indicatorsDashboards
Combine, annotate, and monitor your chosen indicators as macro conditions evolve.
Open dashboardsLets test your theory
Choose your modeling paradigm. Start with data-driven forecasts, or go deeper with structural models.
Forecast
Statistical systems estimated from historical data to forecast, compare scenarios, and quantify uncertainty.
DSGE
Structural equilibrium models grounded in behavioral assumptions, often used for policy counterfactuals.
Coming Soon
Agent Based
Bottom-up simulations where heterogeneous agents interact and aggregate behavior emerges from local rules.
Coming Soon
“All models are wrong, but some are useful.”