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BA Modern Language and Business & Management (Russian) / Course details

Year of entry: 2021

Course unit details:
Macroeconomics 2

Unit code ECON20262
Credit rating 10
Unit level Level 2
Teaching period(s) Semester 2
Offered by Economics
Available as a free choice unit? No

Overview

This course provides an introduction to long run macroeconomic issues such as why some countries so much poorer than other, what drives savings, investment and innovation in the long run. In addition, we will also study the factors that determine unemployment and inflation in the long run. The course keeps a tight connection between economic models and data as it is the feature of modern macroeconomics. To analyse the macroeconomy, we must analyse current data and real-world situations, then apply this knowledge using models and equations. The course provides the necessary tools to analyse long run macroeconomic questions.

Pre/co-requisites

Unit title Unit code Requirement type Description
Macroeconomics 1 ECON10252 Pre-Requisite Compulsory
Introductory Mathematics ECON10061 Pre-Requisite Compulsory
Advanced Mathematics ECON10071 Pre-Requisite Compulsory
Introductory Statistics for Economists SOST10062 Pre-Requisite Compulsory
Advanced Statistics ECON10072 Pre-Requisite Compulsory
ECON10252 Macro 1 and (ECON10061 Intro Math's or ECON10071 Adv. Math's) and (SOST10062 Intro Stats or ECON10072 Adv. Stats)

(ECON10252 Macro) and (ECON10061 Intro Maths or ECON10071 Adv Maths) and (SOST10062 Intro Stats or EON10072 Adv Stats)

Aims

 The aims of this course are:

  1. To provide a self-contained introduction to long-run macroeconomics including long run economic growth, unemployment and inflation for general social scientists.
  2. To cover the preparatory material for more specialist courses in economics in the second and third years.

Learning outcomes

  • Demonstrate knowledge of measuring economic growth and the major issues of long-run economic growth.
  • Understand the concept of modelling economic growth and how different modelling approaches contribute to our understanding of the growth process.
  • Understand how the economics of ideas as the engine of growth necessarily leads to imperfect competition between firms and create monopolies.
  • Understand why some countries so much richer then others, and why some countries like China are growing much faster then others and for how long.
  • Demonstrate knowledge of the major issues of long-term unemployment and inflation.
  • Demonstrate a detailed understanding of the factors that determine long-term unemployment.
  • Understand the quantity theory of money as the long-term determinant of inflation and the fiscal causes of high inflation.

Syllabus

 

  • An Overview of Long Run Economic Growth. Some facts of economic growth including that it is a relatively recent phenomenon from historical point of view. How economic growth dramatically improved welfare around the world.
  • A Model of Production. How to set up a macroeconomic model. How a production function help us to understand the differences in per capita GDP across countries. How too look at economic data through the lens of macroeconomic models.
  • The Solow Growth Model. How capital accumulates over time helping us to understand economic growth. The role of diminishing returns to capital in explaining differences in growth rates across countries. The limitations of capital accumulation.
  • Growth and Ideas. Why new ideas – new ways of using existing resources – are key to sustained long-run growth. Why “nonrivalry” makes ideas different from other economic goods in a crucial way. How the economics of ideas leads to monopolies. A new model of economic growth: the Romer model.
  • The Labour Market, Wages, and Unemployment. How basic supply-and-demand model helps us to understand the labour market. How labour market distortions like taxes and firing costs affect employment in the long-run. How to value your human capital. A key fact: return to university education increased enormously over the past half century.
  • Inflation. What inflation is and how costly it can be. How the quantity theory of money allow us to understand where inflation comes from. How nominal and real interest rates are related. The important link between fiscal policy and high inflation.

Teaching and learning methods

The material is delivered via the online (Blackboard) provision of material (readings, clips) and Lectures.

The learning process of students is supported by tutorials (exercise questions and discussion based questions) and the provision of further online material (such as discussion boards and practice quizzes).

Employability skills

Analytical skills
To provide a detailed and qualified economic perspective on economic growth in the UK and elsewhere from the perspective of a global interdependent world. The ability to provide critical analysis of policies that affect economic growth and cross-country income differences. The ability to provide critical analysis of policies that affect unemployment and inflation in the long run. To use models to interpret economic data.

Assessment methods

75%     Exam

25%      Mid-term test

Feedback methods

  • Mock exam.
  • Online quizzes on Blackboard.
  • Tutorials feedback.
  • Office hours.
  • Revision sessions.
  • Discussion boards.

Recommended reading

  • CORE-ECON open access textbook (few selected chapters).
  • Charles Jones, Macroeconomics, 4th edition (Chapter 2-8).

Study hours

Independent study hours
Independent study 0

Teaching staff

Staff member Role
Akos Valentinyi Unit coordinator

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