Contents
| Course description…………………………………………………………………… | |
| Course prerequisites…………………………………………………………………. | |
| Course objectives……………………………………………………………………. | |
| Distribution of hours of the course by topics and types of work……………………. | |
| Studying methods……………………………………………………………………. | |
| Forms of control and grade determination ………………………………………...... | |
| Literature…………………………………………………………………………….. | |
| Course outline……………………………………………………………………….. | |
| Essay requirements………………………………………………………. | |
| Sample problems and assignments for classwork…………………………………… | |
| Sample problems with solutions…………………..………………………………… | |
| Sample mock examination paper with marking scheme……………………………. | |
| Glossary……………………………………………………………………………… |
Course description
Macroeconomics-2 is a two-semester course for the second year and third year students divided into two parts. The second part is taught for the third year students in the sixth semester. The course examines the main principles of determination of real income, employment and unemployment, the price level and inflation in an open mixed economy, and the conduct of macroeconomic policy.
This part of the course is devoted to microeconomics foundations of macroeconomics, demand management policy, the neo-classical (Solow) growth model, inflation and unemployment.
The assessment of the students will be by the University of London (UL) examinations at the end of the sixth semester. The course is taught in English. The students are also studying for Russian degree in Economics, and knowing Russian terminology through reading in Russian is also required.
For studying the course the knowledge of introductory level Economics and Mathematics for Economists is necessary. In turn, the Macroeconomics course is a pre-requisite for Monetary Economics, International Economics, Development Economics.
Course prerequisites
Students are supposed to be competent in basic economic analysis up to the level of the Introductory Macroeconomics and in calculus taught in the first and second years of studies. Students are also expected to be familiar with constrained optimization problems studied in the course of Mathematics for Economists during the second year of study and basic game theory tools studied in the course of Microeconomics during the third year.
The course itself provides a basis (and so serves as a prerequisite) for such courses as Monetary Economics, International Economics, Economics of Development.
Course objectives
The purpose of the course is to develop the economic way of thinking and make them ready to use logic and methods of economic analysis in their further studies. Specifically the course aims at:
§ giving students a solid grasp of macroeconomic analysis at the intermediate-level using both graphical and algebraic techniques;
§ ensuring students can apply macroeconomic analysis to the study of contemporary and historical economic problems;
§ broadening the students’ knowledge in the field of macroeconomics,
§ developing the studentsr abilities to write essays and understand and critically discuss economic literature.
Distribution of hours of the course by topics and types of work
| № | Topic | Total | Lectures | Classes | Selfstudy | |||||||
| 1. | Aggregate demand in closed economy: IS-LM model | |||||||||||
| 2. | Aggregate demand in an open economy: the IS-LM-BP model | |||||||||||
| 3. | Demand management policy | |||||||||||
| 4. | Unemployment and the AD-AS model | |||||||||||
| 5. | Inflation and the Phillips curve | |||||||||||
| 6. | The Neoclassical (Solow) Growth Model | |||||||||||
| 7. | Microfoundations of aggregate consumption | |||||||||||
| 8. | Microfoundations of aggregate investment | |||||||||||
| 9. | Money demand and money supply | |||||||||||
| Total: | ||||||||||||
Forms or control and grade determination
Control takes the following forms:
Þ written home assignments (6);
Þ essay (2000 words);
Þ mid-term exam (180 min) in the University of London examination format in the middle of the spring semester;
Þ University of London exam by the end of the spring semester (180 min).
Course grade is determined by
Þ University of London exam grade (50%),
Þ Mock exam grade (30%),
Þ home assignments (15%);
Þ essay (5%).
In case of absence at midterm exam (if legal document is provided) student has to write down the midterm exam by the end of April, otherwise he will get 0 points for the mid-term exam.
Literature
Main texts
1. Macroeconomics. Study Guide. University of London, 2009.
https://www.londonexternal.ac.uk/current_students/programme_resources/lse/index.shtml
2. Blanchard O., Macroeconomics, Macroeconomics. 5 Ed. Prentice Hall. Prentice Hall. 2009. [B]
https://vig.prenhall.com/catalog/academic/product/0,1144,0131860267-SS,00.html
3. Dornbush R., S. Fisher and R.Starz., Macroeconomics. 10 ed. McGraw-Hill, 2008. (DFS) https://highered.mcgraw-hill.com/sites/0072823402/information_center_view0/
4. Mankiw, N.G., Macroeconomics, 6 ed. Worth Publishers. 2007. (M) (Russian translation: Н.Г.Мэнкью, Макроэкономика. Изд-во Московского университета, 1994). https://bcs.worthpublishers.com/mankiw6/
Supplementary reading:
1. Abel A., Bernanke B.S. (2000) Macroeconomics, Addison-Wesley, 5 edition.
2. Burda M.C., Wyplosz C. Macroeconomics Oxford University Press. 4 ed., 2005. (Russian translation: М.Бурда, Ч.Выплош, Макроэкономика. Европейский текст. С.-Петербург, Судостроение, 1998.) https://www.oup.com/uk/orc/bin/9780199264964/
3. Gordon R.J., Macroeconomics, 10th ed. Addison-Wesley, 2005.
https://wps.aw.com/aw_gordon_macroecon_10
4. Mankiw G., A Quick Refresher Course in Macroeconomics, Journal of Economic Literature, 1990, 28, 1645-1660.
5. Pentecost E., Macroeconomics: an open economy approach. Palgrave Macmillan, first edition, 2000.
6. Sacks J.D. and F.B. Larrain, Macroeconomics in the Global Economy. Hemel Hempsted, Harvester Wheatsheaf, 1993. (SL) (Russian translation: Сакс Дж.Д., Ларрен Ф.Б. Макроэкономика. Глобальный подход. М., Дело, 1996.)
https://vig.prenhall.com/catalog/academic/product/0,1144,0131022520,00.html
7. Romer D. (2001) Advanced Macroeconomics. McGraw Hill Book Company: London, Ch. 5.
Internet resources
University of London Exam papers and Examiners reports for the last three years
https://www.londonexternal.ac.uk/current_students/programme_resources/lse/index.shtml.
Current course materials are posed at the ICEF information system https://mief.hse.ru
Key macroeconomic indicators https://www.economagic.com/
Russian Federation statistic agency https://www.gks.ru/
Central Bank of Russian Federation statistic agency https://cbr.ru/
Students supplement to textbook Dornbush R., S. Fisher and R.Starz., Macroeconomics. 10 ed. McGraw-Hill, 2008.
https://highered.mcgraw-hill.com/sites/0072823402/student_view0/index.html
Students’ resources to accompany Mankiw, N.G., Macroeconomics, 6 ed. Worth Publishers. 2007. https://bcs.worthpublishers.com/mankiw6/
Students’ resources to accompany Gordon R.J., Macroeconomics, 10th ed. Addison-Wesley, 2005 https://wps.aw.com/aw_gordon_macroecon_10
Students’ resources to accompany Burda M.C., Wyplosz C. Macroeconomics, Oxford University Press. 4 ed., 2005. https://www.oup.com/uk/orc/bin/9780199264964/
Course outline
Aggregate demand in closed economy: IS-LM model (review)
Goods market and IS curve derivation. Assets market and LM curve derivation. Equilibrium in IS-LM model. Effectiveness of fiscal and monetary policies.
(DFS Ch.9-11, 19; B Ch.3-5; M Ch.10-11)
Further reading
Romer D., Keynesian Economics without the LM curve, Journal of Economic Perspectives 14, pp.149-169, 2000.
Hoshi T., A.K.Kashyap, Japan’s Financial Crisis and Economic Stagnation, Journal of Economic Perspectives, 18 (1), 2004, pp. 3-26.
Ludvigson S.C., Consumer Confidence and Consumer Spending, Journal of Economic Perspectives, 18 (2), 2004, pp.29-50.