PRINCIPLES OF MACROeCONOMICS

PREREQUISITES: PRINCIPLES OF MICROECONOMICS

OBJECTIVES

The general aim of the course is to provide a useful introduction to Macroeconomics. In particular, the course will present an examination of the working of the economy as a whole. The course only requires minimal knowledge of mathematical skills. The emphasis is put on building self-directed learning skills and economic thinking.

By the end of the course, you should be able to describe a line of basic theories in macroeconomics, apply them to analyze economy-wide phenomena, and discuss policy conclusions implied by them. Accomplishment of this course is a prerequisite for studying Intermediate Macroeconomics in Level 3.

PROGRESSIVE ASSESSMENT

Coursework assignment (30%)

2 hour examination (70%)

RECOMMENDED TEXTS

Main Textbook:

Mankiw,Principles of Economics(Ch. 23-Ch. 36 on Macroeconomics), South-Western College Pub.

Alternative Textbook:

Samuelsen, P. and Nordhaus,Economics, McGraw-Hill/Irwin.

Stiglitz, J. and Walsh, C. E.,Economics, W. W. Norton & Company.

Lipsey,R. and Chrystal, K.,Economics, Oxford.

If there are more readings, they will be provided at the end of each lecture..

TOPICS TO BE COVERED IN THE LECTURES/ CLASS SCHEDULE

Part I: An introduction to Macroeconomics & Macroeconmic Data (6 hours)

Week 1: Measuring Nation’s Income

Main sources: Mankiw,Principles of Economics(Ch.23)

Week 2: Measuring the Cost of Living

Main sources: Mankiw,Principles of Economics(Ch.24)

Part II: The Classical theory for explaining the real economy in the long run (12 hours)

Week 3: Production and Growth

Main sources: Mankiw,Principles of Economics(Ch.25)

Week 4: Saving, Investment and the Financial System

Main sources: Mankiw,Principles of Economics(Ch.26)

Week 5: The Basic Tools of Finance

Main sources: Mankiw,Principles of Economics(Ch.27)

Week 6: Unemployment

Main sources: Mankiw,Principles of Economics(Ch.28)

Part III: The nominal side (money & prices) of the economy in the long run (6 hours)

Week 7: The Monetary System

Main sources: Mankiw,Principles of Economics(Ch.29)

Week 8: Money Growth and Inflation

Main sources: Mankiw,Principles of Economics(Ch.30)

Part IV: Open economy issues (6 hours)

Week 9: Basic Concepts in Open Economy

Main sources: Mankiw,Principles of Economics(Ch.31)

Week 10: A Macroeconomic Theory of the Open Economy

Main sources: Mankiw,Principles of Economics(Ch.32)

Part V: Short-run macroeconomic fluctuations (15 hours)

Week 11: Aggregate Supply

Main sources: Mankiw,Principles of Economics(Ch.33 part 1)

Week 12: Aggregate Demand

Main sources: Mankiw,Principles of Economics(Ch.33 part 2)

Week 13: The Influence of Monetary Policy on Aggregate Demand

Main sources: Mankiw,Principles of Economics(Ch.34 part 1)

Week 14: The Influence of Fiscal Policy on Aggregate Demand

Main sources: Mankiw,Principles of Economics(Ch.34 part 2)

Week 15: The Short run Trade-off between Inflation and Unemployment

Main sources: Mankiw,Principles of Economics(Ch.35)

Part VI: Macroeconomic policy debates (3 hours)

Week 16: Five Debates over Macroeconomic Policy

Main sources: Mankiw,Principles of Economics(Ch.36)

Week 17: Review and Discussion Prepared for Examination