New Macroeconomic Thinking
Exam number: 6630
Semester: from 1st semester
Duration of the module: One semester
Form of the module (i.e. obligatory, elective etc.): Elective
Frequency of module offer: Irregularly.
Prerequisites: You have to register by sending an E-Mail to Dunsch@europa-uni.de until the 10th of April. This deadline is also valid for all Erasmus / fx-students. Please use your Viadrina E-mail address if possible. Erasmus / fx students may also register via their private E-Mail address in case that the Viadrina E-Mail account is not set up yet.
Afterwards, you will be registered automatically by our chair in the Moodle system. You cannot enroll for this course via the Moodle system by yourself!
Capacity limit: 20 students
- Knowledge in micro- and macroeconomics, math, statistics, and econometrics. Knowledge with respect to macroeconomic models of the open economy (PPP, UIP, Mundell-Fleming model, Dornbusch model, monetary model). A refresher of the macroeconomic models of the open economy will be provided in the exercise classes.
- Students should have the skills to discuss macroeconomic shocks in models of the closed or open economy in a graphical, verbal, and formal way. For example, they know how to use Cramer’s rule to compute multipliers. They have some knowledge about the effectiveness of monetary and fiscal policy in macro models of the open economy under fixed and flexible exchange rate regimes.
- The mathematical knowledge of function optimization with or without constraints constitutes therefore an asset. Students are able to run OLS regressions and interpret regression output in a statistical software such as “R” or STATA.
Applicability of module for other study programmes:
Obligatory or elective in other study programmes. For further information check regulations of the study programme.
Person responsible for module: Prof. Dr. Georg Stadtmann
Name of the professor: Prof. Dr. Georg Stadtmann
Language of teaching: English
ECTS-Credits (based on the workload): 6
Workload and its composition (self-study, contact time):
Contact time (lecture, tutorials, seminar etc.) 45 h; self-study: 135 h
Contact hours (per week in semester): 3
Methods and duration of examination:
Components and their weights:
- Writing and presenting a solution of 3 short case studies (weight 10 % each)
- Several reading quizzes and assignments during the lecture (weight 20 %)
- Final term paper (weight 50 %).
The final grade is calculated by the weighted average of all single components.
All students have to actively participate when a group has to present its solution. In case that a student does not take an active role in the presentation or is absent, the student can only earn 50 % of the credit of the group.
To achieve credits as T-module (7 ECTS Credits), one short essay (pass-fail) has to be done additionally as group work of two students. Please notify us until April 30th, 2016, if you would like to use this option.
Emphasis of the grade for the final grade: Please check regulations of the study programme
Aim of the module (expected learning outcomes and competencies to be acquired):
After successfully completing the course, students should be able to:
Demonstrate knowledge about the models of international trade:
- Have a good understanding of the models of international macroeconomics and their implications.
- Have a good understanding of the assumptions characterizing each model and be able to compare models on the basis of these assumptions.
Demonstrate skills that enable students to
- Apply their knowledge to the reading and analysis of journal articles in the literature covered.
- Analyze complex micro and macroeconomic problems by applying several theoretical or empirical methods.
- Should have the skills to conclude about appropriate policy response in the different settings.
Demonstrate competences that enables students to:
- Apply their knowledge to other contexts, like news from the media, figures released in the press or in the statistics.
Describe and explain their solution of case studies in a written or oral way.
Contents of the module:
Blinder: ls There A Core of Practical Macroeconomics that We Should All Believe? We will use Blinder’s article as a starting point and refresh our knowledge with respect to macroeconomics by relating his insights to the Blanchard’s textbook. Afterwards, we will use the Blanchard et al. paper to analyze, how the crisis has changed the macroeconomic thinking. We will also look at the material (discussion papers conference videos speeches) provided on the webpages of the Institute for New Economic Thinking (http://ineteconomics.org). One main focus will be the financial crisis including banking, currency and sovereign debt crises. We will also discuss the policy implications and policy tools to avoid such crises. Participants should deal with scientific literature and should present one paper in the exercise class.
- Refresher in Mundell Fleming Modell
- Refresher in Monetary Modell
- Refresher in UIP/PPP.
Teaching and learning methods:
Lecture, Exercise, Group Discussions
Literature (compulsory reading, recommended literature):
This is a reading class! You have to come to class well prepared!
Blanchard, Olivier: Macroeconomics 4th ed., Prentice Hall, 2006.
Blanchard, Olivier; Giovanni Dell’Ariccia, and Paolo Mauro (2010): Rethinking Macroeconomic Policy, IMF Staff Position Note, February 12, 2010, SPN/10/03
Blinder, Alan S. (1997): Is there a core of practical macroeconomics that we should all believe? American Economic Review, Papers and Proceedings, 240 – 243.
Nechio, Fernanda: Monetary Policy When One Size Does Not Fit All, FRBSF ECONOMIC LETTER, 2011-18, published: June 13, 2011.
Taylor, John B. (1993): Discretion versus policy rules in practice, Carnegie-Rochetser Conference Series on Public Policy Vol. 39, 195 -214.
Gravelle, Jane G.; Thomas L. Hungerford (2011): Can Contractionary Fiscal Policy Be Expansionary? June 6, 2011 Congressional Research Service 7-5700, www.crs.gov R41849
Alesina; Alberto and Silvia Ardagna (2010), Large Changes in Fiscal Policy: Taxes versus Spending, in Tax Policy and the Economy, ed. Jeffrey R. Brown, vol. 24 (Chicago: University of Chicago Press, 2010), pp. 35-68.
Various Case Studies.
In order to facilitate the exchange of thoughts all students are expected to use name tags.
In order to document the attendance pattern of the class members, a signature list will be passed around at the beginning of each lecture.
The program LaTeX has to be used for all written papers as well as presentations.
All solutions have to follow the structure of a scientific paper:
- Front page, table of contents, list of figures, list of tables, list of abbreviations, variables, indices.
- All equations have to be numbered consecutively.
- References as usual and a list of references in the end of a paper.
Students have to follow the usual rules with respect to academic honesty. Especially, we expect that students do not use any material (Solutions from previous classes, papers written for different classes) without referencing appropriately.
Registration via E-Mail required.