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EC4505: ADVANCED MACROECONOMICS (2017-2018)

Last modified: 24 Jul 2017 14:59


Course Overview

This course focuses on two key issues of economic policy debate, namely economic growth and monetary policy. The emphasis is on the recent developments in macroeconomic theory with particular reference to current problems. The first part of the course deals with economic growth, probably the primary issue of concern to economic policy makers today. The second part of the course focuses on issues related to the workings of a monetary economy. This course is an advanced, technical course, which aims to provide a sound base for those wishing to pursue postgraduate study or a career in economics.

Course Details

Study Type Undergraduate Level 4
Session Second Sub Session Credit Points 30 credits (15 ECTS credits)
Campus None. Sustained Study No
Co-ordinators
  • Dr David McCausland

Qualification Prerequisites

  • Programme Level 4

What courses & programmes must have been taken before this course?

What other courses must be taken with this course?

None.

What courses cannot be taken with this course?

  • EC4503 Macroeconomics (Studied)

Are there a limited number of places available?

No

Course Description

This course seeks to develop an understanding of Macroeconomic theory as a systematic way of analysing the behaviour of the macro economy. The course focuses on two key issues of economic policy debate, namely economic growth and monetary policy. The emphasis is on the recent developments in macroeconomic theory with particular reference to current problems.

The first part of the course deals with economic growth, probably the primary issue of concern to economic policy makers today. Standards of living in some countries have risen dramatically, while others continue to languish in poverty. Growth theory is concerned with the economic mechanisms that govern such behaviour. Modern growth theory is increasingly concerned with technology, increasing returns, productivity, human capital and research and development. We select a small number of prominent theories in the field and examine each in detail, providing us with a wide range of simple but sharp results on the dynamic behaviour of the economy. We begin by looking at exogenous growth models (including the neoclassical Solow-Swan model of the 1950s and the infinite horizon Cass-Coopmans-Ramsey and overlapping generations Diamond model of the 1960s). In exogenous growth models, human capital accumulation, which drives long run growth, is exogenously determined (by, for example, savings rates, population growth or exogenous technological progress). The models are dynamic and are not bound by the assumption of diminishing returns in the accumulation of factors. Finally, we look more closely at investment - the key to long run growth, but also highly volatile in the short run. We develop the q-theory of investment and examine the effect of permanent and temporary demand shocks, interest rate changes and changes to tax credit. This topic provides the bridge between macroeconomics and monetary economics.
The second part of the course focuses on issues related to the workings of a monetary economy. In this part some fundamental questions about money in the macroeconomic framework. What is a monetary economy? Why does money exist? How do we measure the benefit of money in an exchange economy? It further deals with various issues concerning money in a conventional macroeconomic framework related to the various formulations of demand for money functions. Finally issues of the money supply function will be discussed with special attention to the role of the financial intermediation. The fifth part of the course deals with objectives and instruments of policy and deals with questions such as what economic policy is supposed to do? What is the responsibility of the fiscal policy versus the monetary policy? Are fluctuations in the economy caused by real forces or monetary forces?

Degree Programmes for which this Course is Prescribed

None.

Contact Teaching Time

70 hours

This is the total time spent in lectures, tutorials and other class teaching.

Teaching Breakdown


Assessment

1st Attempt:

1 three-hour examination (70%)

Graded tutorial presentation (10%)

Essay max word count 2000 (20%)

Resit: None.

Formative Assessment

This will take place via tutorial discussions and through verbal feedback on the presentation which is then written up to form the essay.

Feedback

Feedback is given on the presentation and the essay. Oral feedback is given on the tutorial presentation.

On a less formal basis, via verbal feedback during tutorial discussions, and after tutorial presentations. Presentation slides and notes are submitted through Turnitin and are available to the external examiner.

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