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Regular version of the site
Master 2021/2022

Macroeconomics. Advanced Level

Type: Compulsory course (Financial Economics)
Area of studies: Economics
When: 1 year, 1-4 module
Mode of studies: offline
Open to: students of one campus
Master’s programme: Financial Economics
Language: English
ECTS credits: 8

Course Syllabus

Abstract

Macroeconomics is a one-year required course designed for the first-year students of the ICEF Master of Science programme in financial economics. It provides an overview of modern macroeconomics at the advanced level. The course is taught in English. Macroeconomics course has three parts. Part I is taught by Professor Nikitin in modules 1 and 2. Its emphasis is on analytical tools of modern dynamic macroeconomics and on the long-run issues, such as the economic growth. Students will learn standard ‘workhorse’ models of modern macroeconomics, including the infinitely-lived representative agent framework and the overlapping-generations framework, as well as some of the standard applications to fiscal policy and social security. Students will be also familiarized with the main ideas of endogenous growth theory, ways to introduce money in dynamic optimizing macroeconomic models and some of the long-run findings from these models, including the optimum quantity of money (the Friedman rule). Part II of the course is taught by Professor Peiris in module 2 and gives an introduction to open economy issues. Part III of the course is taught by Professor Gebauer in modules 3 and 4. It deals with the analysis of the short-run macroeconomic phenomena. It introduces the Real Business Cycle approach and the New Keynesian approach to the problem of economic fluctuations. It also familiarizes students with models of Search and Matching in labor markets. Prerequisites: Students are expected to be familiar with microeconomics and macroeconomics at the intermediate level, calculus of several variables, basic statistics and econometrics.
Learning Objectives

Learning Objectives

  • To give a broad overview of substantive issues of modern macroeconomics;
  • To teach analytical tools and methods of macroeconomic analysis to enable students to continue their education at a Ph.D. level and to read research papers in the area;
  • To enable students to conduct applied analysis of macroeconomic policy while working for government agencies, think tanks, central banks or the private sector;
  • To give students the essential knowledge for applied courses, including financial economics.
Expected Learning Outcomes

Expected Learning Outcomes

  • Compare model predictions with empirical observations
  • Apply macro-finance modelling frameworks developed throughout the course.
  • Apply methodology of search and matching models
  • Apply the methodology of DSGE models
  • Assess the challenges and issues the search theory of unemployment still faces
  • Critically appraise the performance of models vis-à-vis reality
  • Define Recessions and Booms and outline patterns established about Business Cycles
  • Evaluate approaches on how to incorporate monetary frictions
  • Explain and use the basic accounting concepts that describe the modern open economy, stylized facts about the world economy and capital flows.
  • Explain basic statistical techniques used in Business Cycle Literature
  • Explain recent developments in the international banking and financial regulatory environment and models of how policy can affect undesirable economic/financial fluctuations.
  • Explain recent developments of the Russian economy
  • Intelligently discuss some aspects of monetary policy
  • Outline models of international risk sharing and the role of financial frictions and incomplete markets
Course Contents

Course Contents

  • Introduction to economic growth. Solow model with endogenous growth, extensions and applications. Empirical tests
  • Lucas critique and its impact on macroeconomic modeling
  • Dynamic optimizing macroeconomic models: an introduction and applications
  • Endogenous growth. Advanced topics.
  • Money in dynamic optimizing macroeconomic models.
  • Social infrastructure, predation and protection in macroeconomic models
  • International Accounting, Risk Sharing and Business Cycles
  • International Exchange Economies, Risk Sharing and Incomplete Markets
  • Financial Stability, Macro/Micro-prudential policy and international spillovers.
  • Russia as an Open Economy and Review
  • Business Cycle dynamics. The issues of business cycle movements definition. Statistical ways of economic dynamics decomposition into short- and long-run dynamics. Stylized facts about short-run movements.
  • The Real Business Cycle (RBC) models.
  • The New Keynesian models.
  • Search-Theoretic Models.
Assessment Elements

Assessment Elements

  • non-blocking homework assignments
  • non-blocking course participation
  • non-blocking midterm test
  • blocking exam
    Online format.
  • blocking final exam
Interim Assessment

Interim Assessment

  • 2021/2022 1st module
  • 2021/2022 2nd module
    0.05 * course participation + 0.6 * exam + 0.1 * homework assignments + 0.25 * midterm test
  • 2021/2022 3rd module
  • 2021/2022 4th module
    0.5 * 2021/2022 4th module + 0.025 * course participation + 0.3 * final exam + 0.05 * homework assignments + 0.125 * midterm test
Bibliography

Bibliography

Recommended Core Bibliography

  • Advanced macroeconomics, Romer, D., 2001

Recommended Additional Bibliography

  • Blanchard, O., & Fischer, S. (1989). Lectures on Macroeconomics. Cambridge, Mass: The MIT Press. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=nlebk&AN=11345
  • Economic growth, Barro, R. J., 2004
  • Foundations of international macroeconomics, Obstfeld, M., 1996
  • Gong, G., & Semmler, W. (2006). Stochastic Dynamic Macroeconomics: Theory and Empirical Evidence. Oxford University Press. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsrep&AN=edsrep.b.oxp.obooks.9780195301625
  • Introduction to economic growth, Jones, C. I., 2002