dr hab. Marcin Kolasa, prof. SGH dr hab. Krzysztof Makarskimarcin.kolasa@sgh.waw.pl krzysztof.makarski@sgh.waw.plweb.sgh.waw.pl/~mkolas/ web.sgh.waw.pl/~kmakar/

Advanced Macroeconomics

1. Introduction to economic methods.Readings: Blaug (1980): 1-5; Wickens (2008): 1.

2. Growth facts. Solow model.Readings: Acemoglu (2009): 1-2; Barro and Sala-i Martin (2004): 1; Romer (2005): 1; Wickens (2008): 3.1-3.3.

3. Introduction to dynamic macroeconomic problems. Ramsey model.Readings: Acemoglu (2009): 8; Barro and Sala-i Martin (2004): 2; Romer (2005): 2.1-2.6; Wickens (2008): 4.

4. Fiscal policy in Ramsey model.Readings: Barro and Sala-i Martin (2004): 3.1; Ljungqvist and Sargent (2005): 10-11; Romer (2005): 2.7;Wickens (2008): 5.

5. Endogenous growth.Readings: Acemoglu (2009): 11; Barro and Sala-i Martin (2004): 4; Romer (2005): 3.

6. Overlapping generation models.Readings: Heer and Maussner (2008); Romer (2005): 2; Ljungqvist and Sargent (2005): 9; Auerbach and Kot-likoff (1987).

7. Value function iterations.Readings: Ljungqvist and Sargent (2005): 2-3; Stokey, Lucas, and Prescott (1989): 3-4; McCandless (2008).

8. Business cycle facts. Real business cycle model.Readings: McCandless (2008); King, Plosser, and Rebelo (1988); Romer (2005): 4; Wickens (2008): 14; Cooleyand Prescott (1995).

9. Solving dynamic stochastic general equilibrium models.Readings: Blanchard and Kahn (1980); Canova (2007): 2; Uhlig (1999); McCandless (2008).

10. Extensions to real business cycle model.Readings: Hansen (1985); Rogerson (1988); King and Rebelo (2000); Rebelo (2005).

11. Monetary models.Readings: Walsh (2010): 2-3; Wickens (2008): 8.

12. Monopolistic competition. Sticky price business cycle model.Readings: Wickens (2008): 9; Gali (2008): 3.

13. DSGE models - practical session.Readings: Barillas, Bhandari, Colacito, Kitao, Matthes, Sargent, and Shin (2010); Griffoli (2008).

This is the first part of the two-semester course in Advanced Macroeconomics at the QEM program (see www.sgh.

waw.pl/informacje-en/qem). Its focus is mainly on simple models, which lay foundations for more sophisticatedtheories, including models with various types of frictions, taught at Advanced Macroeconomics II. It is also intendedfor students who do not participate in the QEM program but are interested in a more comprehensive exposition tomacroeconomic theory than it is offered by standard one-semester courses.

Most of the classes are organized in form of lectures, combined with practical exercises using instructive examplesand problems. Some of them involve applying numerical methods to solving the models. A natural extension in thisdirection is offered at the companion course Macroeconomic Modeling, which is also one of the elective courses in theQEM program.

Evaluation is based on the final exam (70 points) as well as homework and classroom activity (30 points). Tobe admitted to the exam you need to obtain at least 15 points for the homework and classroom activity. To passthe course your total score must be at least 50 points.

The exam is based on topics and problems discussed during the course and posted on the web pages of theinstructors. The homework lists will be posted consecutively on the web. It is your responsibility to get it from there.

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Homework is due in class on the due date. While preparing your homework, you may talk about the problems withother students, but you must write up your own solutions in your own words.

There is no single textbook for the course. However, most of the discussed topics are covered in either Benassy(2011), Ljungqvist and Sargent (2005), Romer (2005) or Wickens (2008).

While studying you may find useful to use various scientific paper browsers like e.g.: econpapers.repec.org,ideas.repec.org and scholar.google.com; article databases, e.g. www.jstor.org, www.sciencedirect.com andwww.nber.org.

We invite all interested in economic theory to participate in Warsaw Economic Seminars (https://sites.google.com/site/warsaweconseminars/).

References

Acemoglu, D. (2009): Introduction to modern economic growth. Princeton University Press.

Auerbach, A. J., and L. J. Kotlikoff (1987): Dynamic Fiscal Policy. Cambridge University Press.

Barillas, F., A. Bhandari, R. Colacito, S. Kitao, C. Matthes, T. J. Sargent, and Y. Shin (2010):“Practicing Dynare,” mimeo, New York University.

Barro, R., and X. Sala-i Martin (2004): Economic growth. The MIT Press.

Benassy, J.-P. (2011): Macroeconomic Theory. Oxford University Press.

Blanchard, O. J., and C. M. Kahn (1980):“The Solution of Linear Difference Models under Rational Expectations,”Econometrica, 48(5), 1305–11.

Blaug, M. (1980): The Methodology of Economics. Cambridge University Press.

Canova, F. (2007): Methods for Aplied Macroeconomic Research. Princeton University Press.

Cooley, T. F., and E. C. Prescott (1995): “Economic Growth and Business Cycles,” in Frontiers of BusinessCycle Research, ed. by T. F. Cooley, pp. 1–38. Princeton University Press.

Gali, J. (2008): Monetary Policy, Inflation, and the Business Cycle. Princeton University Press.

Griffoli, T. (2008): “DYNARE User Guide: An introduction to the solution and estimation of DSGE models,”mimeo, CEPREMAP.

Hansen, G. D. (1985): “Indivisible labor and the business cycle,” Journal of Monetary Economics, 16(3), 309–327.

Heer, B., and A. Maussner (2008): Dynamic General Equilibrium Modeling: Computational Methods and Applica-tions. Springer: Berlin, 2 edn.

King, R. G., C. I. Plosser, and S. T. Rebelo (1988): “Production, growth and business cycles : I. The basicneoclassical model,” Journal of Monetary Economics, 21(2-3), 195–232.

King, R. G., and S. T. Rebelo (2000): “Resuscitating Real Business Cycles,” NBER Working Papers 7534, NationalBureau of Economic Research, Inc.

Ljungqvist, L., and T. Sargent (2005): Recursive macroeconomic theory. The MIT Press, 2 edn.

McCandless, G. (2008): The ABCs of RBCs: An Introduction to Dynamic Macroeconomic Models. Harvard Univer-sity Press.

Rebelo, S. (2005): “Real Business Cycle Models: Past, Present and Future,” Scandinavian Journal of Economics,107(2), 217–238.

Rogerson, R. (1988): “Indivisible labor, lotteries and equilibrium,” Journal of Monetary Economics, 21(1), 3–16.

Romer, D. (2005): Advanced Macroeconomics. McGraw-Hill/Irwin, 3rd edn.

Stokey, N., R. Lucas, and E. Prescott (1989): Recursive methods in economic dynamics. Harward UniversityPress.

Uhlig, H. (1999): “A toolkit for analyzing nonlinear dynamistochastic models easily,” in Computational methods forthe study of dynamic economies, ed. by R. Marimon, and A. Scott. Oxford University Press.

Walsh, C. (2010): Monetary theory and policy. The MIT Press.

Wickens, M. (2008): Macroeconomic Theory. A Dynamic General Equilibrium Approach. Princeton University Press.

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