APPLIES TO ACADEMIC YEAR 2013/2014

DRE 4007 Advanced Macroeconomics

Responsible for the course
Tommy Sveen

Department
Department of Economics

Term
According to study plan

ECTS Credits
6

Language of instruction
English

Introduction
Please note that this course will be revised before it is offered again

Learning outcome
The course consists of two parts. The first part gives the students an introduction to recursive macroeconomics. This part is about “language” and techniques and the goal is to give the course participants methodological tools for advanced research in macroeconomics. The focus is on models with microfoundation, that is on models where behavior is derived from household’s preferences and firm’s production technology etc.

The topic of the second part is recent advances in monetary economics. The goal is to introduce students to recent advances in New Keynesian theory. Those models have become a standard tool for central banks and they are used as a framework for much modern research in macroeconomics. The course will focus on important extensions of the canonical New Keynesian model.

Prerequisites
Admission to a PhD Programme is a general requirement for participation in PhD courses at BI Norwegian Business School.

External candidates are kindly asked to attach confirmation of admission to a PhD programme when signing up for a course with the doctoral administration. Other candidates may be allowed to sit in on courses by approval of the courseleader. Sitting in on courses does not permit registration for courses, handing in exams or gaining credits for the course. Course certificates or conformation letters will not be issued for sitting in on courses

Compulsory reading

Articles:
A complete list of articles will be handed out at the beginning of the course

Recommended reading

Course outline
Part 1: Long-run economic growth and fiscal policy (ES)

List of topics:
Consumption and investment
Optimal resource allocation over time: The Ramsey-Cass-Koopmans model
Overlapping generations models of closed and open economies: Effects of public debt and pay-as-you-go pension systems.
Fiscal policy, intergenerational risk sharing
Endogenous growth theory, the role of social infrastructure/institutions.


Part 2: Monetary Policy, Inflation and the Business Cycle (TS)

List of topics:
Monetary Policy, the Canonical New Keynesian Model, and the Cost of Business Cycles
Sticky Wages and Capital Accumulation
Monetary Policy and the Open Economy
Unemployment Dynamics and Sticky Prices
Financial Frictions in Credit Markets