Macroeconomic Theory
This course employs the tools of macroeconomics to study various macroeconomic problems. The problems range from economic stability in the short run, to change prices in the medium run, and economic growth in the long run. We cover macroeconomic theories and models, and apply them to address macroeconomic issues in the real world.
Macroeoconomic Theory I – Fall
The MT1 has two main parts: theories and applications. First, students gain conceptual and theoretical knowledge. Then, we develop models to explain the behavior of the economy in the short run.
The primary goal of first semester is to develop a consistent way of thinking about some key macroeconomic phenomena such as output gap, inflation, and unemployment.
In particular, we will try to address the following type of questions:
Why does macroeconomic activity fluctuate?
How do different shocks and policies affect employment, output, inflation, investment and consumption over the business cycle?
Macroeoconomic Theory II – Spring
The MT2 focuses on long-run dynamics of the economy by developing the tools of modern growth theory.
The second semester covers Solow growth model as a description of how the economy evolves over time and emphasizes the roles of capital accumulation and population growth.
After developing basic theories to explain the economy in the long run and in the short run, we turn to several topics that refine our understanding of the economy.
We analyze some of the microeconomic decisions behind macroeconomic phenomena.
Once students have solid command of standard macroeconomic models, we use these models as the foundation for discussing some of the key debates over economic policy. Then, we focus on the various debates over government debt and budget deficits. Finally, we discuss the financial system and its linkages to the overall economy.
Textbook
Macroeconomics, G. Mankiw, 11th edition, Macmillian Learning
1. The Science of Macroeconomics
Chapter 1
2. The Data of Macroeconomics
Chapter 2 and 3
3. Money and Inflation
Chapter 4 and 5
4. The Economy in the Short Run
Chapter 10
5. The Core of Macroeconomic Theory
Recommended Textbook Chapters:
The Principles of Macroeconomics, Case, Fair, and Oster. 13th Edition
Chapters 8,9,19
6. Microeconomic Foundations
Chapters 16 and 17
7. Aggregate Demand I
Chapter 11
8. Aggregate Demand II
Chapter 12
9. Aggregate Demand III
Chapter 13
10. Aggregate Supply
Chapter 14
11. National Income
Chapter 13
11. Long Run I
Chapter 8
12. Long Run II
Chapter 9