Macroeconomics

obligatory courses

Basic algebraic skills

Classroom

The course will introduce students to the models and techniques used in modern macroeconomic theory. The objective of the course, besides specialized knowledge acquisition, is to develop the ability of critical thinking, using the quantitative tools in macroeconomic analysis.

The course begins with the analysis of basic macroeconomic concepts, such as inflation, aggregate output, and unemployment. It is followed by a short run analysis, based on the IS-LM model, of equilibria in the goods market and in the financial market, as well as general macroeconomic equilibrium. The medium-run analysis of inflation and unemployment is based on the Phillips curve relationship.

The long-run dynamics of capital (physical and human), technology and output is studied within the framework of neoclassical growth model. Finally, the effectiveness of fiscal and monetary policies will be discussed.

Overall grades will be based upon lecture score (60 %), and tutorial score (40%).

1. The world economy after the global financial crisis. Gross Domestic Product, the unemployment rate, the inflation rate. Okun’s law and the Phillips curve.

2. The goods market and the determination of equilibrium output.

3. Financial market: the demand for money and the determination of the interest rate.

4. The IS-LM model.

5. Financial market: the role of risk and financial intermediaries. Extension of the IS-LM model.

6. The labor market (the determination of wages and the natural rate of unemployment)

7. The Phillips curve.

8. The IS-LM-PC model.

9. Introduction to economic growth.

10. The Solow growth model.

11.Technological progress and growth.

12. Fiscal policy.

13. Monetary policy.

REQUIRED:

Blanchard,O., Amighini, A., Giavazzi, F. (2017) Macroeconomics: A European Perspective, Pearson, 3rd edition

topic 1: ch. 1 & 2;

topic 2: ch. 3;

topic 3: ch. 4;

topic 4: ch. 5;

topic 5: ch. 6;

topic 6: ch. 7;

topic 7: ch. 8;

topic 8: ch. 9;

topic 9: ch. 10;

topic 10: ch. 11;

topic 11: ch. 12;

topic 12: ch. 21 & 22;

topic 13 ch. 21 & 23;

SUGGESTED:

Abel, A. B. and Bernanke B. S., Croushore, D., (2017) Macroeconomics, Pearson Education, 9th ed.

Mankiw, N.G. (2018) Macroeconomics, Worth Publishers, 10th ed.

EXPERTISE:

Upon the course completion students:

- know basic macroeconomic theories and their methodological frameworks.

- know the determinants of output and inflation in the short-, medium-, and long-run.

- know the consequences and limitations of monetary and fiscal policies.

- are able to analyze the functioning of the goods and financial markets and the relationships between them.

SKILLS:

Upon the seminar completion students:

- are able to identify, interpret and explain economic phenomena using knowledge from the theory of macroeconomics.

- are able to critically evaluate the achievements of theory and empirical research in the field of macroeconomics.

- combine and use multiple sources of information to deepen the knowledge about macroeconomic processes.

SOCIAL SKILLS:

Upon the seminar completion students are able to:

- identify sources of and design strategies to overcome obstacles to human capital accumulation.

- propose solutions to address labor market disequilibrium.

- develop strategies for effective time, task management and work planning.

Grades will be based upon lecture score (60 points) and tutorial score (40 points).

Lecture score is based on the final written exam score (60 points). The final exam will consist of analytical problems.

Tutorial class score consists of in-semester assignments score (12 points) and the exam score (28 points). The tutorial class exam will consist of numerical problems.

The pass grade is at or above 50% and students must pass the tutorial class to be allowed to attend the final exam.

n.a.