Graduate Macroeconomics

Eesti keeles

The purpose of this graduate course is to provide an overview of macroeconomic theories. The students will get acquainted with standard mathematical and analytical methods used in modern macroeconomics. The aim is to enable the students to read and work with journal-based literature within the field. The course gives an overview of the most important topics in modern macroeconomics: growth theory, including new growth theory, with research and development; Keynesian as well as modern micro-based theories of economic fluctuations; unemployment, monetary policy and fiscal policy.

Due to the latest changes in structure of graduate studies in Estonia, the course is taught as an obligatory part of the program for both MA students, and PhD students of Economics in Tartu University.

Structure and lecture notes (in Estonian):

1. Economic growth: Solow model (Slides, Problem Set 1)
2. Economic growth: Ramsey model (Slides, Problem Set 2)
3. Economic Growth: Overlapping-Generations Models (Slides, Problem Set 3)
4. Economic Growth: Endogenous Growth Models (Slides, Problem Set 4)
5. Business Cycles: Real-Business-Cycle Theory (Slides, Additional Material: Dynamic Programming, Problem Set 5)
6. Business Cycles: Keynesian Theories (Slides, Problem Set 6)
7. Business Cycles: Incomplete Nominal Adjustment (A) (Slides, Problem Set 7)
8. Business Cycles: Incomplete Nominal Adjustment (B) (Slides)
9. → Midterm exam
10. Unemployment: Efficiency-Wage Model (Slides, Problem Set 8)
11. Unemployment: Search and Matching Models (Slides, Problem Set 9)
12. Consumption: Permanent Income Hypothesis, Risky Assets (Slides, Problem Set 10)
13. Investments: Cost of Capital, Tobin's q (Slides, Problem Set 11)
14. Inflation and Monetary Policy (Karsten Staehr) (Problem Set 12)
15. Budget Deficit and Fiscal Policy (Karsten Staehr) (Problem Set 13)
16. Problem Sets Tutorial

• → Final exam in June

• Obligatory course for MA and PhD students in Departpent of Economics and Business Administration, University of Tartu
• Official information (from Studies Information Database): Advanced Advanced Macroeconomics for MA students (MJRI.10.004) and Advanced Advanced Macroeconomics for PhD students (MJRI.10.007)
• Lecturers: Raul Eamets, Marit Hinnosaar and Toomas Hinnosaar
• Course homepage: http://moodle.mtk.ut.ee/course/view.php?id=10 (restricted)
• Course takes place in Spring semester 2006 and lasts 16 weeks.
• Course gives 6 CP and ends with written exam. Grade is a sum of: midterm exam (30%) and final exam (70%).

The course follows mainly David Romer's textbook «Advanced Macroeconomics», which is required reading for everyone (link to library, link to bookshop). Some topics are complemented with sections from other textbooks and articles. Detailed list of required and supplementary readings will be available at the homepage.

References and other useful books No items in this list

Electronic materials

1. Video: Ed Prescott ja Finn Kydland.
2. Every Breath You Take - Hubbard vs Bernanke.
3. George Akerlof - Lecture in World Bank.
4. Benjamin Friedman - Lecture in World Bank.
5. Daron Acemoglu - Lecture in World Bank.
6. L'Hospital's Rule (MathWorld).
7. L'Hôpital's rule (Wikipedia).
8. Poisson Distribution (MathWorld).
9. Poisson distribution (Wikipedia).
10. Unemployment Cartoon - TIME.com.

Background reading:

• It is also assumed, that all the students have the basic knowledge of Mathematical Economics, to refresh it, one could read Anneli Kaasa's textbook Majandusteaduse matemaatilised alused or web-based material Matemaatilised meetodid majandusteaduses1).
• English-Estonian-English Dictionary of Economics.