MACROECONOMICS 1

Why are some countries rich and others poor? What types of countries grow more rapidly? Why do certain societies fail to improve their technologies? Why do economies undergo significant short-run variations in output and employment? This course will introduce students to these major questions and to the theoretical and conceptual tools necessary for answering them. The presentation of the theories will be supplemented with examples of relevant empirical works and policy implications.

Students will get a graduate-level introduction to economic theories, models, and empirical evidence on modern macroeconomics. By the end of the course, students will be able to outline and manipulate several workhorse models, derive and analyze the relevant policy conclusions implied by them, and refer to the available evidence. Moreover, students will be familiar with the conceptual and mathematical foundations of modern macroeconomics analysis.

The technical prerequisite is the knowledge of the mathematical tools presented in an undergraduate course in Mathematics (i.e. multiple-variable functions, derivatives, static optimization, integrals, matrix algebra). Students may find it useful to be familiar with any undergraduate-level book in macroeconomics (e.g. Mankiw’s “Macroeconomics” by Worth or Blanchard’s “Macroeconomics” by Pearson).

We will attempt to cover the following topics:
1. Growth Facts – we will start with a quick look at some basic facts about economic growth and evidences on cross-country income differences
2. The Solow-Swan Model – we will develop a framework to think about causes and mechanics of the process of economic growth and cross-country income differences
3. Neoclassical Growth Model – we will analyse the Ramsey model, while introducing the mathematical and conceptual foundations of modern macroeconomic analysis (e.g. preferences, transversality conditions, optimal control);
4. Overlapping Generations Models – we will depart from the representative household assumption and introduce a model where different agents arrive over time; we will use this framework to think about e.g. the role of money and social security
5. Endogenous Growth Models – we will talk about the role of human capital in fostering growth and start considering models of endogenous growth, like the AK model and Romer’s model of expanding variety
6. Equilibrium Growth Under Uncertainty – we will turn our attention to the short-run and focus on economic fluctuations, through the Brock-Mirnan and the Real Business Cycle models

If time allows, we will also cover Equilibrium Unemployment Theory.

The main references for this course are:
• Romer, P. Advanced Macroeconomics, McGraw Hill.
• Barro, R. J., and Sala-i-Martin, X. Economic Growth, MIT Press.
• Acemoglu, D. Introduction to Modern Economic Growth, Princeton University Press. (more advanced)

Useful but more advanced texts include:
• Stokey, N. L., Lucas, R., and Prescott, E. Recursive Methods for Economic Dynamics, Harvard University Press.
• Ljunqvist, L., and Sargent, T. Recursive Macroeconomic Theory, MIT Press.

Additional references may be pointed out in class. Before each class, slides will be made available to students.

In the course of the academic year, there will be four exam sessions. The first session, which takes place during the first semester, is articulated in a midterm written exam (worth 50% of the final mark) on the contents covered in the first part of the course and a final written examination (worth 50% of the final mark) on the contents covered in the second part of the course; the final mark will be the weighted average of the two exams. PhD students and QEM-JD students must take the exam in the first session; the first session is also open to everyone else. The remaining sessions (Jan – Sep) consist of a single written examination on the full contents covered in the course. QEM students for whom this course is worth 6 ECTS, are only evaluated on the first half of the course and can take the exam in week VII or in any session. Every student has the chance to earn extra points by submitting homework during the first semester.

scritto

There will be three two-academic-hour classes per week for ten weeks, for a total of 60 academic hours. The first class of each week will be a practical session based on take-home tutorials, the remaining two classes will usually consist of frontal lectures and discussions. In the first week, there will be no tutorial. Classes are also recorded and published on Moodle.

Please note that this course outline may be subject to change. Up-to-date information on scheduled meetings, the course outline, et cetera can be found on the Moodle for this class.

Questo insegnamento tratta argomenti connessi alla macroarea "Povertà e disuguaglianze" e concorre alla realizzazione dei relativi obiettivi ONU dell'Agenda 2030 per lo Sviluppo Sostenibile