Macroeconomics

Prof. Giovanna Vallanti

Dott. Mario Denni

 

 

This course aims to provide the methodological and theoretical tools to understand how the economies work and to explain the past and current economic developments. We will focus on the stylised facts of business cycle fluctuations and economic growth, the determinants of unemployment and inflation. We will also discuss whether and to what extent policy can improve macroeconomic performance.

The bulk of course materials will come from three sources: the lectures, the course readings and the textbook. Supplemental readings, lecture handouts and problem sets will be made available on the course web page a few days before lectures. Problem sets will be provided each week and discussed in the classes which will be generally held every Thursday from 12.15 to 13.45.  In order to succeed in the Course, students  are strongly encouraged to attend lectures and classes regularly and  to attempt the assigned problems before attending classes.

The final exam consists of a two hour written examination.

Course outline

 

Introduction

• Defining the macroeconomics variables
• The Short Run, the Medium Run and the Long Run

PART I -The Short Run

• The goods market, the financial markets and the IS-LM model
• Fiscal and monetary policies in the short run

PART II - The Medium Run

• The labour market and the natural rate of unemployment.
• The AS-AD model: inflation, production and money growth.
• Fiscal and monetary policies in the medium run

PART  III - The Long Run

• Saving, capital accumulation and growth
• The role of technological progress
• The facts of growth: capital accumulation vs. technological progress

PART  IV - Extensions: The Open Economy

• The goods market and the financial markets in the open economy
• Fiscal and monetary policies and the exchange rates

PART  V - The role of the policy

• Uncertainty, expectations and the effectiveness of the policy
• The central bank and the optimal inflation rate
• Budget deficit and the Ricardian equivalence

 Textbook:

Blanchard, O. , Macroeconomics,  V edition, Prentice Hall Int., 2006.

Mankiw, G. N., Macroeconomics, Sixth edition, Worth Publishers, 2006

Syllabus_Macroeconomics