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Line 24: This model is further advanced in higher levels of undergraduate studies. [[David Romer]] proposed in 2000 that the LM curve be replaced in the [[IS–LM]] model.<ref>{{cite journal \|last=Romer \|first=David \|year=2000 \|title=Keynesian Macroeconomics without the LM Curve \|journal=[[Journal of Economic Perspectives]] \|volume=14 \|issue=2 \|pages=149–169 \|doi=10.1257/jep.14.2.149 \|url=http://www.nber.org/papers/w7461.pdf }}</ref> Instead, Romer suggested that although the Federal Reserve uses [[open market operation]]s to impact the federal funds rate, they are not targeting [[money supply]], but rather the [[interest rate]]. Therefore, he suggests removing the LM curve and replacing it with the [[IS/MP model\|MP curve]]. ==See also==

AD–IA model: Difference between revisions