Foundations of Macroeconomics

URL study guide

https://studiegids.vu.nl/en/courses/2024-2025/W_JSM_111

Course Objective

By the end of the course, the student will:
• Be able to understand and master core macroeconomic concepts underlying macroeconomic theories, notably aggregate income, unemployment, inflation and economic growth.
• Be able to describe the development of different schools of macroeconomic thought and relate these schools to their historical context.
• Be able to describe recent macroeconomic theories of aggregate output, unemployment, inflation and economic growth, and to perform basic computations with mathematical representations.
• Can relate modern and historical macroeconomic theories to currently observed macroeconomic phenomena such as the financial crisis, the crisis in the Eurozone or the corona pandemic.

Course Content

The course gives students an understanding of how macroeconomic thought has developed over time. In addition, basic tools are offered to analyze relation between production, employment and inflation. The course provides basic insights in Classical, Keynesian, Monetarist, New Classical schools of thought, New-Keynesian, as well as brief introductions to Real Business Cycle Theory (RBC) and Heterogeneous Agent New Keynesian models (HANK). The major focus, also guided by the development of economic thought, is on short run fluctuations. However, also attention will be given to the long run, by treating the Solow growth model, and Endogenous Growth Theory, and important developments in this field. The course combines a historical/political contextualization of theories with formal description in model terms. Hence, we analyze formal models of short run fluctuations including the IS-LM model, the Philips curve and the AD-AS curve, and models of economic growth including the Solow model. Finally, central concepts of macroeconomics such as inflation, employment, labor productivity and technological progress are analyzed in relevant contexts, and basic computational exercises are included to enhance familiarity with these concepts.

Teaching Methods

Lectures and seminars (mandatory)

Method of Assessment

Quizzes (two times, 15% each) and final written exam (70%)

Literature

McDowell, Moore, Rodney Thom, Ivan Pastine, Robert H. Frank and BenBernanke (2012) Principles of Economics (3rd European Edition), McGraw Hill

Target Audience

PPE students

Custom Course Registration

Seminar groups made through Canvas.

Additional Information

Additional literature supplied through Canvas.

Recommended background knowledge

Basic calculus

Explanation Canvas

Course guide, additional literature, problem-sets and solutions, introductory videos and other material made available through Canvas; communication (organisation of debates, group assignments) and assignments (quizzes) also through Canvas.