MONIAC Interactive

www.learnwithotti.co.uk

Money flow (£) Closed valve

Phillips Machine · A.W.H. Phillips, 1949 · Hydraulic model of Keynesian circular flow

Live Readouts

Updates every tick as the economy converges to its new equilibrium.

National Income (Y)

£100

Consumption

£60

Savings

£15

Tax

£20

Imports

£15

Aggregate Demand

£100

Multiplier (k)

2.0×

Behavioural Parameters

Households' propensities. Open a valve wider → more flow at every level of Y.

Marginal propensity to consume MPC 0.60

Share of after-tax income that households spend.

Marginal propensity to import MPM 0.15

Fraction of income spent on imports — leaks abroad.

Tax rate t 20%

Proportional income tax that diverts income to the government tank.

Injections £ per period

Exogenous flows the government / firms / foreigners pump back into the economy.

Government spending G £20

Investment I £15

Exports X £15

Scenarios

Preset shocks. Click and watch the tanks rebalance.

How it works

Built by economist Bill Phillips in 1949, the MONIAC modelled the British economy with water. Each tank holds a sector's stock; each pipe carries a flow of money. Leakages (T, S, M) drain the income tank; injections (G, I, X) pump money back in. Equilibrium is reached when leakages = injections. Open or close the valves above to shock the economy.