BSc Economics

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See course Blackboard pages.

(ECON10071 OR ECON20071) AND (ECON20032 OR ECON20532)

The course focuses on the role of modern theories of economic growth and state of the art theories of economic fluctuations and economic policies. These elements have been increasingly recognized in recent years as playing a key role in shaping macroeconomic outcomes in the long and in the short run determining the effects of economic policies.

In the first part of the course (long run analysis), the aim will be to give students an overview of the main theories of economic growth, starting from the general equilibrium neoclassical growth model, then the endogenous growth model and the Schumpeterian growth model.

In the second part of the course (short run analysis), the course will focus instead on the Real Business Cycle and the New Keynesian models and various extension of monetary and fiscal policy models.

Students should be able to:

• master the main equilibrium concepts of economic growth.
• work with a saddle path graph.
• know long run policy implications of fiscal policies.
• understand the main mechanisms behind a monetary model.
• solve for the short and long term general equilibrium.
• solve for the optimal policy under discretion and commitment.

Provisional

Brief overview of the syllabus/topics:

1. Introduction. The Neoclassical Growth Model. The Ramsey Model;
2. The Endogenous Growth Model;
3. Income differences among countries;
4. The Real Business Cycle Model;
5. The Basic New Keynesian Model;
6. Monetary Policy Design in the New Keynesian Model;
7. Monetary Policy Trade-offs: Discretion Vs Commitment;
8. Revision Class

Textbooks:

1. Advanced Macroeconomics, David Romer fourth Edition;
2. Monetary Policy, Inflation and the Business Cycle, Jordi Galí, Second Edition.

Additional reading (book chapters, blogs, and journal articles) will be provided through Blackboard

Synchronous activities (such as Lectures or Review and Q&A sessions, and tutorials), and guided self-study.

Intellectual skills: (i) problem-solving skills; (ii) skills of analysis, and the application of analytical models; (iii) the evaluation and critical analysis of arguments, theories and policies; (iv) synthesise and evaluate data

Practical skills: (i) independently locate and assess relevant literature, and to draw on these to develop understanding and to construct arguments.

Transferable skills and personal qualities: (i) select and deploy relevant information; (ii) communicate ideas and arguments in writing; (iii) apply skills of analysis and interpretation; (iv) manage time and work to deadlines; (v) use ICT to locate, analyse, organise and communicate information (e.g. internet, on-line databases, search engines, library catalogues, spreadsheets, specialist programs, word processing and presentation software).

• Tutorials.
• Office hours.
• Revision sessions.
• Discussion boards.