Titular Professors
Professors
The main objective of the course is to provide students with an understanding of the main macroeconomic forces at work in a modern economy, the theories that seek to explain these forces, and the ability to interpret economic trends and participate in policy debate.
On the completion of this course students should have a basic understanding of:
- The ultimately closed nature of the macroeconomy and the circular flow of income.
- How to measure and interpret some main economic variables (GDP, IPC, etc)
- The key relationship between saving and investment and the determination of interest rates
- Monetary policy
- Fiscal policy
- The nature of money and debt
- Inflation and deflation
- The long-run determinants of economic growth and prosperity
- Some key ideas of the different schools of economic thought
Lectures will follow closely the structure set out in the main textbook, Economics, by Mankiw, N. Gregory and Taylor, Mark P. (This is the European edition of Principles of Economics, by N. Gregory Mankiw). We will aim to cover 10 main topics, covering the material in about 12 of the chapters in this book, plus selected elements from other chapters.
Topic 1. Measuring a Nation's Income. The circular flow of income and Gross Domestic Product (GDP).
Topic 2. Measuring the Cost of Living. The consumer price index and GDP deflator; the difference between real and nominal economic variables.
Topic 3. Production and Growth. The determinants of long-run economic growth: capital accumulation, population growth and productivity.
Topic 4. Saving, Investment and the Financial System. The relationship between saving and investment, the role of the interest rate in bringing supply and demand for loanable funds into equilibrium. Public versus private saving
Topic 5. The Monetary System. The function of money, defining money, the money supply, the role of the central bank and commercial banks in money creation.
Topic 6. Money growth and Inflation. The long-run neutrality of money, printing money, inflation as a tax, costs of inflation.
Topic 7. Open-Economy Macroeconomics: Basic Concepts. Trade balances, international investment flows, exchange rates, purchasing power parity.
Topic 8. Keynes, aggregate demand and aggregate supply. Keynesian theory, the business cycle, aggregate supply and demand, the short- and the long-run.
Topic 9. The Influence of Monetary and Fiscal Policy on Aggregate Demand. The power of monetary policy; deficit spending, fiscal multipliers and crowding out.
Topic 10. Employment and Unemployment and Income Distribution.
The lecture component of the course will follow closely the structure and content set out in the main textbook ECONOMICS by Mankiw, N. Gregory and Taylor, Mark P. Students are expected to come to class prepared, having completed a first approximation to each topic. Lecture slides will be available to download, and online videos will also be referenced for class preparation and review.
Good preparation will generate more time for interactive class sessions and project work. Questions of macroeconomics often generate big disagreements among policy makers as well as economists. To understand these controversies, students will ask to discuss them in the format of a structured debate in the penultimate week of the semester. Students will be put into pairs and given the assigned question by the course professor.
Weekly homework quizzes will also be assigned to test students' knowledge of the material covered in the lectures and should help students to develop a regular study routine and sit the exams with confidence.
Participation 10%
Project 20%
Homework, Quizzes and Reading 10%
Mid-term exam 30%
Final examination 30%
Required textbook:
Mankiw, G., Taylor, M., ECONOMICS, Cengage Learning EMEA.
Other textbooks for reference:
Begg, D., Dornbush, R. & Fisher, S., ECONOMICS, Ed. Mc Graw Hill.
As well as the main textbook, weekly readings will be posted on the e-study or handed out in class. Each week you will have essential reading which will form the basis of class discussions and participation.