Economic Policy - Monetary and Fiscal
Course by: Atanas Pekanov
Vienna University of Economics and Business (WU Wien)
Winter Semester 2024
Slides, Unit 1 - 2
For the group presentations, please choose one of the following topics:
Group 1 Monetary Policy, “Whatever It Takes” and QE (4 December)
Introduction to what the ECB has done in 2012 (2 person)
https://www.kfw.de/About-KfW/Newsroom/Latest-News/News-Details_426753.html
Monetary Policy since the crisis: Speech by Peter Praet (2 people)
https://www.ecb.europa.eu/press/key/date/2017/html/sp170316.en.html
The monetary policy response to the pandemic emergency (2 people)
https://www.ecb.europa.eu/press/blog/date/2020/html/ecb.blog200501~a2d8f514a0.en.html
In addition, the homework task for your group is the following (one person presents it and explains how it is related to the above discussions):
1. Prepare in addition to your presentation, a couple of slides (4 max) that will talk about the recent wave of the ECB Survey of Professional Forecasters. You can find it on the ECB website. In two or three slides you will tell us what is the ECB Survey of Professional Forecasters and in another two or three slides you will present 2 or 3 interesting graphs from the recent survey, with a special focus on inflation, GDP and unemployment expectations. Everything you need is on the ECB website.
Group 2 Fiscal Policy – Austerity and Government Spending Multipliers (11 December)
Please cover:
Multiplier Debate - Fiscal Consolidation - At What Speed - Blanchard and Leigh (3 people)
https://voxeu.org/article/fiscal-consolidation-what-speed
Austerity and fiscal adjustments - Alberto Alessina (2 people)
https://voxeu.org/article/fiscal-adjustments-and-recession
https://voxeu.org/article/cut-deficits-cutting-spending
The New View on Fiscal Policy – by Jason Furman (3 people)
https://voxeu.org/article/new-view-fiscal-policy-and-its-application (this is a summary, please also read the whole article for clarification and details:
Please, make sure you explain well the concept of Ricardian equivalence in your presentation. It will be important for the exam.
In addition, the homework task for your group is the following (one person needs to present the results):
1. I want for you to make your own first survey and report the results. It will not be representative as you would only ask your fellow students, so you will have a sample of around 20 people, but it is still something. I would like you to ask your colleagues the following question:
Ask you classmates (send them emails and ask them to answer the following question):
If tomorrow by surprise you are given 500 (five hundred) extra dollars (maybe you win the lottery or your university transfers you a one-off extra payment or some other random event that leads to this happens), how much of it would you spend in the next year? You can respond with just a number (either in dollar terms or %) or also with a longer reply if you know exactly what you will do with the money.
You would report first the average value you have obtained; you will search on the Internet for a paper which reports self-reported MPCs (marginal propensities to consume) and will compare its average results with the ones you obtain. Then you will report a bar chart with all answers.
Group 3 The Euro - Fiscal and Monetary Policy Policy at the Euro Area Level (11 December First Half, 8 January second )
As usual, please have in mind that you can split the material in other proportions regarding your own preference.
Completing the Odyssean journey of the European monetary union - Vitor Constancio (3 people can take this)
https://www.ecb.europa.eu/press/key/date/2018/html/ecb.sp180517.en.html
Past and future of the ECB monetary policy - Vitor Constancio (3 people can take this)
https://www.ecb.europa.eu/press/key/date/2018/html/ecb.sp180504.en.html
Phillip Lane - Underlying Inflation (3 people should take this speech)
https://www.ecb.europa.eu/press/key/date/2023/html/ecb.sp230306~57f17143da.en.html
In addition, the homework task for your group is the following (1 person presents this):
1. Prepare in addition to your presentation, a couple of slides (3 slides) that will talk and summarize the recent World Economic Outlook Macroeconomic Forecasts by the IMF. You can find it on the IMF website (check in October whether a new one has been published already).
In two or three slides you will tell us what is the main message and in another two or three slides you will present 2 or 3 interesting graphs from the chapter. The chapter may seem long, but you should not think about this as presenting the whole chapter - you should skim the text and then choose the most interesting/important graphs and key messages. Choosing and explaining why this information is important is central part of this assignment.
Group 4 (8 and 15 January) Europes Lagging Productivity
Isabel Schnabel - From laggard to leader? Closing the euro area’s technology gap (4 people)
https://www.ecb.europa.eu/press/key/date/2024/html/ecb.sp240216~df6f8d9c31.de.html
The Draghi Report (7 people)
The future of European competitiveness – A competitiveness strategy for Europe
In addition, the homework task for your group is the following (2 person):
1. In addition to the above presentation, run a short poll with your students - ask them a question relating to the biggest challegnes they think Europe is facing. You can choose the type of question (open or closed) and the format. The goal is to be able to summarize their responses in 3 slides and analyse them briefly.