Macroeconomics

First-Year Courses

Course description

Workload: 150 hours / 6 ECTS

Lecture: Bi-weekly, 14 x 90 minutes, in person

Begin: 21.04.2023

Time: Fridays 10:30 – 12:00 and 13:00 – 14:30

Registration

Please register for the course until March 31, 2023 by sending an e-mail to cgde@iwh-halle.de.
The course is designed for at most 25 participants.

Exam

6 of 7 Problem Sets (at least one from every block indicated by Roman numbers) have to be successfully passed to complete the course.

Pre-course in Matlab

There will be a voluntary pre-course in Matlab on April 15 and 19 (via Zoom) in which students will be made familiar with the software and taught skills that will be required in parts of the main course. Please indicate with your registration if you want to attend the pre-course.

Course contents

  1. Technology, Institutions and Growth (Professor Dr Lars Börner, Martin Luther University Halle-Wittenberg)
    1. Long Run Growth: Technology and Human Capital
    2. Long Run Growth: Institutions
    3. State Formation and Policy: Welfare State, Fiscal and Monetary Policy
  2. Quantitative Growth Modeling (Professor Dr Thomas Steger, Leipzig University)
    1. Methods: Dynamic Optimization & Numerical Solution
    2. Workhorse Models: Ramsey & OLG
    3. Endogenous Growth: Education & Technological Change
    4. Economic Growth & Climate Change
  3. Dynamic Stochastic General Equilibrium Models of Fluctuations (Professor Dr Roland Winkler, Friedrich Schiller University Jena)
    1. The Baseline Real Business Cycle Model
    2. The Baseline New Keynesian Model
    3. Monetary and Fiscal Policy in the Baseline New Keynesian Model
    4. Macroeconomic Stabilization Policies in Models with Heterogeneity

Main Literature

Literature marked with an asterisk has to be studied beforehand.

I.1 Long Run Growth: Technology and Human Capital
(*) Goldin, Claudia. Human Capital. In: Claude Diebolt and Michael Haupert, Handbook of Cliometrics. Berlin: Springer Verlag 2016, 55-86.
(*) Mokyr, Joel.  Long-term Economic growth and the History of Technology. Handbook of Economic Growth, Volume 1, Part B, 2005, 1113-1180.
I.2 Long Run Growth: Institutions
(tba)
I.3 State Formation and Policy: Welfare State, Fiscal and Monetary Policy
(*) Dincecco, Mark and Gabriel Katz. State Capacity and Long-Run Economic Performance: The Economic Journal. Vol. 126 (Feb.), pp. 189-218.
(*) Johnson, Noel D. and Mark Koyama. States and Economic Growth: capacity and constraints. Explorations in Economic History. 2017, Vol. 64, pp. 1-20.
(*) Przeworski, Adam, and Fernando Limongi. Political Regimes and Economic Growth. Journal of Economic Perspective. 1993. Vol. 7 (3), pp.  51-69.
II.1 Methods: Dynamic Optimization & Numerical Solution
(*) Azzimonti, M., P. Krusell, A. McKay, and T. Mukoyama (2024). Macroeconomics. With T. Boppart, G. Corsetti, L. Dedola, J. Hassler, J. C. Hatchondo, J. Heathcote, A. Hornstein, P. Klenow, S. Lloyd, L. Martinez, K. Mitman, C. Olovsson, M. Piazzesi, V. Quadrini, M. Ravn, R. Rogerson, V. Rios-Rull, A. Sahin, M. Schneider, K. Storesletten, and G. Violante. https://phdmacrobook.org/. Chapters 4 & 9.
See also the Relaxation website: https://sites.google.com/view/relaxmacro
II.2 Workhorse Models: Ramsey & OLG
(*) Acemoglu, D. (2009): Introduction to Modern Economic Growth, Princeton University Press, Chapters 8-9.
II.3 Endogenous Growth: Education & Technological Change
(*) Acemoglu, D. (2009): Introduction to Modern Economic Growth, Princeton University Press, Chapters 10, 12 & 13.
II.4 Economic Growth & Climate Change
(*) Azzimonti, M., P. Krusell, A. McKay, and T. Mukoyama (2024). Macroeconomics. With T. Boppart, G. Corsetti, L. Dedola, J. Hassler, J. C. Hatchondo, J. Heathcote, A. Hornstein, P. Klenow, S. Lloyd, L. Martinez, K. Mitman, C. Olovsson, M. Piazzesi, V. Quadrini, M. Ravn, R. Rogerson, V. Rios-Rull, A. Sahin, M. Schneider, K. Storesletten, and G. Violante. https://phdmacrobook.org/. Chapter 24.
Barrage, Lint & William D. Nordhaus (2023): Policies, Projections, and the Social Cost of Carbon: Results from the DICE-2023 Model, NBER Working Paper 31112.
Dietz, S., & Venmans, F. (2019). Cumulative carbon emissions and economic policy: In search of general principles. Journal of Environmental Economics and Management, 96, 108-129.
III Dynamic Stochastic General Equilibrium Models of Fluctuations
(*) Azzimonti, M., P. Krusell, A. McKay, and T. Mukoyama (2024). Macroeconomics. With T. Boppart, G. Corsetti, L. Dedola, J. Hassler, J. C. Hatchondo, J. Heathcote, A. Hornstein, P. Klenow, S. Lloyd, L. Martinez, K. Mitman, C. Olovsson, M. Piazzesi, V. Quadrini, M. Ravn, R. Rogerson, V. Rios-Rull, A. Sahin, M. Schneider, K. Storesletten, and G. Violante. https://phdmacrobook.org/. Chapters 1-2, 13, 17.
(*) Bilbiie, F. O. (2020): The New Keynesian Cross. Journal of Monetary Economics 114, 90-108.
Gali, J. (2015): Monetary Policy, Inflation, and the Business Cycle: An Introduction to the New Keynesian Framework and Its Applications. Second Edition. Princeton University Press. Chapters 1-5.
Woodford, M. (2011): Simple Analytics of the Government Expenditure Multiplier. American Economic Journal: Macroeconomics 3(1), 1-35.

Course details