Course Syllabus
Macroeconomic Theory (EC_50400&EC_M5050)
Instructor: Ming-Jen Chang, Spring 2024
Professor Office Hours: by appointment
Office: D410, Humanities I
Email:
[email protected]Phone: 5551
Lecture: Friday 9:10am- , once two weeks (D220, Humanities I)
Objectives: This course is constructed to familiarize students with the skills of
modern macroeconomic theory at the graduate level. Models are developed to
explain how growth model, real business cycles, Keynesian theory and
microeconomic foundation models are determined.
Prerequisites: ECN 1B or their equivalents. The course does need to use
calculus and linear algebra.
Text: Advanced Macroeconomics, 5th Edition, David Romer, 2019, New York,
NY: McGraw-Hill/Irwin (ISBN 978-1260185218).
Outline of Topics:
Topic 1: The Solow Growth Model (chapter 1)
Topic 2: Infinite-Horizon and Overlapping-Generations Models (chapter 2)
Topic 3: Endogenous Growth (chapter 3)
Topic 4: Real-Business-Cycle Theory (chapter 5)
Topic 5: Nominal Rigidity (chapter 6)
Topic 6: Dynamic Stochastic General-Equilibrium Models of Fluctuations (chapter 7)
Topic 7: Financial Markets and Financial Crises (chapter 10)
Topic 8: Monetary Policy (chapter 12)
Evaluation: The course grade will be based on a group presenting and a midterm
exam with a comprehensive final exam [5% participation rate + 30% presenting (a
paper each student) + 35% Midterm + 35% Final].
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Calendar of Lectures
Feb. 23 x
Mar. 1 topic 1
Mar. 8 x
Mar. 15 topic 2
Mar. 22 x
Mar. 29 topic 3 & Midterm
Apr. 5 no class (spring break)
Apr. 12 x
Apr. 19 x
Apr. 26 topic 4
May 3 topic 5
May 10 x
May 17 topic 6 & presenting
May 24 x
May 31 presenting
Jun. 7 x
Jun. 14 presenting & Final term
Reading list:
[1] Andrade, P., E. Gautier, E. Mengus, 2023, What matters in households’ inflation
expectations?, Journal of Monetary Economics 138, 50-68.
[2] Bianchi, J. 2011, Overborrowing and systemic externalities in the business cycle,
American Economic Review 101, 3400–3426.
[3] Bianchi, J. and E.G. Mendoza, 2018, Optimal time-consistent macroprudential
policy, Journal of Political Economy 126, 588–634.
[4] Bordo, M., K. Istrefi, 2023, Perceived FOMC: The making of hawks, doves and
swingers, Journal of Monetary Economics 136, 125-143.
[5] Caldara, D., F. Ferrante, M. Iacoviello, A. Prestipino, and A. Queralto, 2024, The
international spillovers of synchronous monetary tightening, Journal of Monetary
Economics 141, 127-152.
[6] Chang J.-J., H.-Y. Lin, N. Traum, and S.-C. S. Yang, 2021, Fiscal consolidation
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and public wages, Journal of Money, Credit and Banking 53, 503-533.
[7] Chang, T.-T. and Y. Li, 2021, Banking, liquidity effects, and monetary policy,
Macroeconomic Dynamics, forthcoming.
[8] Chen, S., M.B. Devereux, K. Shi, J. Xu, 2023, Consumption heterogeneity and
monetary policy in an open economy, Journal of Monetary Economics 140, 1-15.
[9] Chen, B.-L. and S.-Y. Liao, 2018, Durable goods, investment shocks and the
comovement problem, Journal of Money, Credit and Banking 50, 377-406.
[10] Cho, D., K.H. Kim, S.J. Kim, 2023, Inefficient international risk-sharing, Journal
of Monetary Economics 138, 31-49.
[11] Chu, A.C., G. Cozzi, C.-C. Lai and C.-H. Liao, 2015, Inflation, R&D and growth
in an open economy, Journal of International Economics 96, 360-374.
[12] Chu, A.C., C.-C. Lai and C.-H. Liao, 2019, A tale of two growth engines:
Interactive effects of monetary policy and intellectual property rights, Journal of
Money, Credit and Banking 51, 2029-2052.
[13] Ellisona, M. and N. Rankin. 2007. Optimal monetary policy when lump-sum
taxes are unavailable: A reconsideration of the outcomes under commitment and
discretion, Journal of Economic Dynamic & Control 31, 219–243.
[14] Farhi, E. and I. Werning, 2016, A theory of macroprudential policies in the
presence of nominal rigidities, Econometrica 84, 1645–1704.
[15] Fender, J. and N. Rankin, 2003, A small open economy with staggered wage
setting and intertemporal optimization: The basic analytics, Manchester School 71,
396–416.
[16] Gáti, L., 2023, Monetary policy & anchored expectations - An endogenous gain
learning model, Journal of Monetary Economics 140, S37-S47.
[17] Hong, G.H., M. Klepacz, E. Pasten, and R. Schoenle, 2023, The real effects of
monetary shocks: Evidence from micro pricing moments, Journal of Monetary
Economics 139, 1-20.
[18] Lenel, M., M. Piazzesi, and M. Schneider, 2019, The short rate disconnect in a
monetary economy, Journal of Monetary Economics 106, 59–77.
[19] Li, Y., G. Rocheteau and P.-O. Weill, 2012, Liquidity and the threat of fraudulent
assets, Journal of Political Economy 120, 815-846.
[20] Schmitt-Grohe, S. and M. Uribe, 2017, Is optimal capital control policy
countercyclical in open economy models with collateral constraints? IMF Economic
Review 65, 498–527.
[21] Shen, W. and S.-C.S. Yang, 2018, Downward nominal wage rigidity and
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state-dependent government spending multipliers, Journal of Monetary Economics 98,
11-26.
[22] Stein, J.C., 2012, Monetary policy as financial-stability regulation, Quarterly
Journal of Economics 127, 57–95.
[23] Zhang, C. and S. Zhao, 2023, The macroeconomic announcement premium and
information environment, Journal of Monetary Economics 139, 55-73.
