Last Update: All MT2 material is now posted. Macro Theory Notes preparation stage: Chapter 7 (Posted: Tuesday, May 15, 2012)


 

Economics 331: Intermediate Macroeconomic Theory
Spring 2012

 

Instructor: Pavel Kapinos

Office: Willis 322                                                                                                      

Email: pkapinos@carleton.edu                                                          

Office hours: Tu, We 3-5; appt

 


Essentials:
Syllabus
Greek Alphabet


Macro Theory Notes (MTNotes) | Disclaimer: These notes are a work in progress. Please do not print out the whole set at once, as contents will be updated throughout the course. If you do want to print some pages, please do so only for the material that has been assigned for the given lecture. If you feel that there is a typo or a point that really needs to be clarified, please let me know ASAP. Thanks!


Date

Lecture

References: Required | [Recommended]

March 27 (Tu)

Lecture 1:Course  Overview | Intro to Modern Macro

Jones 1, 2 | MTNotes 1.1—1.3.4 | [Jones 15]

March 29 (Th)

Lecture 2: Intro Continued—General Equilibrium

MTNotes 1.4—1.5 | [Wiczer notes on precautionary savings and borrowing constraints]

April 3 (Tu)

Lecture 3: Overview of Economic Growth | The Malthusian Model

Jones 3 | Galor (2005), Sections 1 and 2 | MTNotes 2.1—2.2 | Malthus.xlsx | [Money, Happiness, and Bulgaria—an Economist update] | [4 minute overview of the history of economic development]

April 5 (Th)

Lecture 4: Exogenous Growth Theory: The Solow Model

Jones 4, 5 | MTNotes 2.3

April 10 (Tu)

Lecture 5: Endogenous Growth Theory: The Romer Model

Jones 6

April 12 (Th)

Lecture 6: Market Failure | Dynamic Optimization | Endogenous Growth Theory: The AK Model | [Human Capital and Growth]

MTNotes 1.3.5, 1.4.2-1.4.3, 2.5

April 17 (Tu)

Lecture 7: From Growth to Business Cycle Fluctuations: Business Cycles  and the Labor Market | History of Macroeconomic Thought

Jones 7 | MTNotes 3 | [Carlin and Soskice 2.5-6] | [Autoregressive processes] | [RBC model without capital] | [RBC model with capital] | [US GDP decomposition]

April 19 (Th)

Midterm I

Lectures 1—6; Problem Sets 1—3 | Old midterms: Winter ’08, Spring ’08, Winter ’10, Spring ’10, Winter ‘11, Spring ‘11, Winter ‘12 | Disclaimer: Old exams may not be representative of the material on the upcoming ones.

April 24 (Tu)

Lecture 8: Inflationary Dynamics in the Long Run | Inflationary Dynamics in the Short Run: Phillips Curve

Jones 8, 9 | MTNotes 4.1-4.4 | disinflation.xls

April 26 (Th)

Lecture 9: Output Gap Dynamics: IS Curve | Inflation Targeting and Introduction to Monetary Policy

Jones 10 | MTNotes 4.5-4.7

May 1 (Tu)

Lecture 10: Monetary Policy in a Static New Keynesian Model

Jones 11 | MTNotes 5 | Workbook (read the paper and use the Excel file, questionnaire is strongly recommended, technical appendix is not required) | [Kapinos and Wiczer (2010)—Overview of Inflation Targeting (unproofed version)] | [Conic sections and their application in Agora]

May 3 (Th)

Lecture 11: Adaptive Inflationary Expectations and a Dynamic Model of Monetary Policy Conduct: Major Events in the US Macroeconomic History

Jones 12 | Lecture notes | [Dealing with Recessions: An Overview]

May 8 (Tu)

Lecture 12: Financial Crisis and the Liquidity Trap

Jones 13, 14 | Monetary Policy Game | The Living Yield Curve | [Bernanke Grilled on Inflation] | MTNotes 6 [Fiscal stimulus critics: Mankiw, Taylor]

May 10 (Th)

Lecture 13: Issues in Monetary Dynamics: Inflationary Bias; Myopia, Discretion, and Commitment; Preemptive Easing

MTNotes 7 | Lecture notes | Forward-looking inflationary expectations during the most recent crisis and its aftermath

May 15 (Tu)

Lecture 14: Fiscal Policy I

Jones 15 | Carlin and Soskice 6.3-4 | [Co-chairman of the deficit commission weighs in on the problems with the modern youth]

May 17 (Th)

Midterm II

Lectures 1—13; Problem Sets 1—6 | Old midterms: Winter ’08, Spring ’08, Winter ’10, Spring ’10, Winter ‘11, Spring ‘11, Winter ‘12 | Disclaimer: Old exams may not be representative of the material on the upcoming ones.

May 22 (Tu)

Lecture 15: Fiscal Policy II | Open-economy Macro I

Class notes [Jones 16] | Alternative views of addressing the fiscal crisis: CEAs, Stiglitz

May 24 (Th)

Lecture 16: Open-economy Macro II

Jones 17 | Class notes | Romer on the Dollar

May 29 (Tu)

Lecture 17: Open-economy Macro III

Class notes [Jones 18] | Krugman on the state of macro | Cochrane’s response to Krugman | Kocherlakota on the state of macro

TBD

Final

Everything


 

Problem Sets:
Problem Set 1, due Thu, 4/5 | Solution
Problem Set 2, due Thu, 4/12 | Solution
Problem Set 3, due Tue, 4/17 | Solution
Problem Set 4, due Thu, 5/3 | Solution
Problem Set 5, due Thu, 5/10 | Solution
Problem Set 6, due Tue, 5/15 | Solution


 

Links:
Macroeconomic updates: Global Economic Forum by Morgan Stanley
Financial and Economic News: CNN MoneyEconomist, Wall Street Journal
Nobel Prize Laureates in Economics
FRED II database by the Federal Reserve Bank of Saint Louis (U.S. data)
Penn World Table Database by the Center for International Comparisons at the University of Pennsylvania
Mankiw Blog, Krugman Blog