Economics II

Teacher(s)

Latzer Hélène;

Language

English

Learning outcomes

At the end of this learning unit, the student is able to :

define and distinguish between the main macroeconomic variables; describe and explain the existing relationships and interactions between those macroeconomic variables; use graphical and algebraic models that clarify these relationships; analyze the effects of macroeconomic shocks; describe the various macroeconomic policy instruments and discuss their effects.

Content

1. The main macroeconomic variables and the National Accounts
2. Measuring aggregate prices and their evolution through time
3. The monetary system
4. The determinants of the aggregate demand: the IS-LM model
5. The labor market and the determinants of the aggregate supply
6. The medium-run macroeconomic equilibrium: the AD-AS model
7. The Phillips curve
8. Anticipations and the macroeconomic analysis
9. An introduction to open economy
10. The market for goods and services in the open economy
11. The Mundell-Fleming model
12. An introduction to determinants of long-run growth
13. The Solow model

Teaching methods

1. Plenary lectures:
During the plenary lectures, the professor presents the concepts and mechanisms associated to the different models.
The lectures follow the course outline presented above.

2. Exercise sessions (TA sessions):
Exercise sessions are carried out in small groups and aim at checking knowledge acquisition as well as applying the theoretical concepts presented in class to solve exercises and case studies. Students should review the corresponding lectures before the session to draw full benefit from them. Those exercise sessions will also be partly devoted to the preparation of home assignments in which students are expected to manipulate macroeconomic data, read selected articles relating to macroeconomic topics and write reports.

Evaluation methods

The final grade consists of two parts:

• a written report (home assignment);
• written final exam (2h).

These two parts are weighted as follows in the final grade:

• 85 % for the written exam and 15% for the home assignments if the score obtained at the written exam is at least 50%;
• 92,5 % for the written exam and 7,5% for the home assignments if the score obtained at the written exam is less than 50%.

The grade of the home assignments is automatically reported to the next session unless the student explicitly asks for representing them.

Bibliography

The reference book for this course is Blanchard, Macroeconomics, Pearson, 6th Edition or former ones (the 7th and 8th Edition do not follow the same structure any more). The course will cover the first 8 chapter of the reference book.

Faculty or entity

> ESPB