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- Code:
- ECOM-R319
- Field:
- Macroeconomics
- Targets:
- Research Master's students PhD students
- Organiser:
- University of Helsinki - Economics
- Instructor:
- Antti Ripatti
- Period:
- Period 2
- Format:
- Participation in teaching
- Method:
- Contact teaching
- Venue:
- Economicum
- Enrollment:
Equivalent to ECOM-R319 Advanced Macroeconomics 3
In case of conflicting information consider the Sisu/Course/Moodle pages the primary source of information.
Aalto, Hanken and UH economics students can enroll through their home university’s SISU. Further instructions are available on the How to enroll? page, also for students from other universities.
If you would like to count the credits towards your degree, please check your curriculum or contact your supervisor or student services for guidance.
Lectures and exercises will be streamed for FDPE students (outside the capital region), but not for Helsinki GSE students (Aalto, Hanken and UH students). A link to the stream will be sent by Jenni Rytkönen in a separate email a few days before the course starts. If you don’t receive the link, please contact Jenni (jenni.rytkonen@aalto.fi).
- To access the Moodle course area, use all the features and participate in the activities (assignments, discussions), you must have successfully registered for the course in Sisu and logged in with your UH user ID.
- For more information on how to activate your UH user ID and register for a Moodle course area, click here.
Content
The course starts with an introduction to business cycle facts and methods. Then we introduce the neoclassical growth economy, cast it in a recursive form, and derive optimality conditions. We define the equilibrium concept. Then we present the main theoretical concepts and methods for solving and calibrating linear stochastic dynamic general equilibrium (DSGE) models with aggregate shocks. We use the neoclassical growth model, also known as the real business cycle model, as the workhorse to demonstrate the methods. Then we study why monetary policy is neutral in the classical, RBC-type macro models. The classical model is augmented with imperfect competition and price rigidities, leading to the canonical New Keynesian model. Next, various monetary policy rules are studied in this framework. We also build a bridge to study the interaction of fiscal and monetary policies and examine the open-economy dimension of monetary policy. Finally, topic(s) concerning current aggregate economic policy issues may be covered.
Learning outcomes
After the course, the student should
- Be able to compute stylized business cycle facts using macroeconomic data
- Be able to set up a macroeconomic model as a recursive problem and derive optimality conditions
- Be able to understand different equilibrium concepts
- Be able to linearize equilibrium conditions, solve linear dynamic models, and compare them to data
- Understand and master the neoclassical growth model
- Be able to derive and solve the New Keynesian model and compare the welfare effects of alternative monetary policy rules
- Understand optimal monetary policy in the basic New Keynesian framework
- Be able to describe the interaction between monetary and fiscal policy
- Be able to describe how the open-economy setting alters the previous results
- Be able to apply and alter DSGE models for topical economic policy issues