ECON 102 : Intermediate Macroeconomics Fall 2024
Objectives: The goal of this course is to gain fundamental knowledge in macroeconomic topics. The goal is to gain expertise on the following questions: why do economies grow over time? what determines consumption, investment and employment? What are the causes of inflation? Why do we have recessions? How do central banks operate and what is the role of fiscal policy? This is an intermediate macroeconomics class. As such, we will study some formal models and cover statistical analysis to answer these interesting questions in the most scientific way possible. I also try to bring my enthusiasm about history to the class. My commitment is to teach you some classic themes in macroeconomics and expose you to some recent research and debates in macroeconomics such as “will there be inflation in the near future?” and “have there been major changes in the labor market” . We will naturally discuss the effects of the Covid-19 Pandemic in the US economy.
Why should you care about this course? The obvious answer is that you are soon to become professional economists and that macroeconomics is one of the core components of economic theory. What is going on in the macroeconomy is a topic of table conversation, so even if you decide to steer your career away from economics in the future, being able to understand economic news and current policy debates will make you a
Most importantly, macroeconomics is also a guideline for industry jobs. Should you decide to take a job in the business world, it will be useful, for the rest of your life, to understand if a certain region (i.e., a country, state, city or neighborhood) is expected to grow, what are the effects of interest rates on your activities, what are the labor demand conditions and what are the effects of inflation. This course will build that intuition. Should you decide to seek a policy career in Government, this course will cover the primary reason for the existence of your job.
Prerequisites: An undergraduate-level understanding of calculus is assumed. For example, you should be familiar with exponentials and logarithms. You should be comfortable taking derivatives and first-order conditions.
Grading Policy: Class Participation of Current Topics (10%), Homeworks (20%), Midterm (20%), Final (50%). If you do better in the final than in the midterm: Midterm=0% and Final=70%.
● For class participation, you are expected to intervene in class regarding current events. If you don’t feel comfortable speaking in public you can participate in the class forum on our classes’s platform. You may otherwise submit a 2 page “The Economist” style article at the end of the course.
Midterm: Monday , May 6, 2024 3:30 PM - 4:45 PM
Important Dates:
Final: Monday, June 10, 2024, 2024 06:00 PM - 11:00 AM
Course Policy:
● Please sign up for the course on time to confirm your enrollment.
Class Policy:
● Regular attendance is essential and expected.
● Cell phones off, no laptops (no exceptions).
● If caught chatting online, you will invite you to leave class.
● We will follow UCLA Covid Policy strictly
Academic Honesty: I expect the highest standard of academic honesty. All of your work has to be individual and use of any references has to be cited. Lack of knowledge of the academic honesty policy is not a reasonable explanation for a violation. I will not hesitate to bring any form of plagiarism to university authorities.
Course Outline:
1. Introduction and GDP Definition (Week 1: 2 Lectures) I IntroI GDP Accounting I Beyond GDP
I PK Ch. 1-2 I ABC
2. Economic Growth (Weeks 2-3: 4 Lectures)
I Cross-Country Growth FactsI Kaldor Facts
I The Ramsey Solow model I Growth Accounting I The drivers of TFP
I PK Ch. 3 4 5 I ABC
First Homework Assignment: assigned Wednesday of Week 2. Due Wednesday of Week 3
(before class)
3. Consumption-Savings (Week 4: 2 Lectures) - First Homework Assignment: assigned Wednesday of Week 4. Due in one Week.
I Determinants of Consumption I Permanent Income
I Ricardian Equivalence I Inability to Borrow
I PK Ch. 6 I ABC
Second Homework Assignment: assigned Wednesday of Week 4 . Due Wednesday of Week 5
(before class)
4. Labor Market (Week 5: 2 Lectures) I Measurement and Definitions I Static labor supply decisions I Labor Demand
I Equilibrium Labor Market I Time Buffer
I PK Ch. 7 I ABC
5. Midterm Week (Week 6: 2 Lectures)
I Practice Question in Class
I Midterm Exam takes place
6. Investment (Week 6: 1-2 Lectures)
I Net-Present Values I Portfolio Risk
I Equity Prices
I Aggregate Investment and Savings
I PK Ch. 8 I ABC
Third Homework Assignment: assigned Wednesday of Week 6. Due Wednesday of Week 7
(before midterm)
7. Introduction to General Equilibrium (Week 7: 1 Lecture)
I Two Period Aggregate Economy I Welfare Theorem
I Time Buffer
I PK Ch. 9 I ABC
8. Money and Inflation (Week 8: 1 Lectures)
I Definition of Money I Money Supply Determinants I Money Demand I Inflation
I Price Level and Quantity Theory I Segnioriage and Inflation Cost
I PK Ch. 10-11 I ABC
Fourth Homework Assignment: assigned Wednesday of Week 8. Due Wednesday of Week 9
(before class)
9. Business Cycles (Week 8: 1 Lectures)
I Facts
I RBC Model
I PK Ch. 12-13 I ABC
10. New Keynesian Economics (Week 9-10: 4 Lectures)
I Sticky Prices - ISLM
I Historical Considerations
I Phillips Curve
I Monetary Policy I Fiscal Policy
I PK Ch. 14-15 I ABC
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