Schramm identifies the adaptability and flexibility of the labor force as one of the key drivers for the Chinese economy. Pick one of the Ten Macro Facts at the end of the chapter that plays a similar role (a shock absorber) in a traditional Keynesian framework. Explain.

Question

Quizplus · Accepted Answer

The Answer is Macro Fact 6 is the only one with the word "flexibility" in it. Flexible prices and wages allow for economies to absorb "shocks" better, since they can change instead of some corresponding level of output or employment.

Schramm Identifies the Adaptability and Flexibility of the Labor Force