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Course Question & AnswerIntermediate Macroeconomics
Purpose of Course showclose
Course Information showclose
Welcome to Intermediate Macroeconomics! This class presents a rigorous framework for developing economic analysis. The material is detailed and relies heavily upon a variety of quantitative skills. The course utilizes sophisticated mathematical techniques to explain basic underpinnings of macroeconomic theory. While some of the concepts are similar to those in the introductory macroeconomics course, the material in this class develops more complex relationships and requires greater synthesis of abstract ideas.
For many economics majors, Intermediate Macroeconomics is their first exposure to developing abstract models about entire economic systems; however, remember to explore theory and policy applications. For example, consider how a significant change in government policy causes a ripple effect throughout the entire economy. An abstract model may indicate one solution, but also think about the practical policy outcomes. Reflect on the meaning of the models in a broader context and develop the ideas from both a business and social science perspective.
Below, please find general information on this course and its requirements.
Course Designer: Joy Zhao and Tony Pizur, Ph.D.v
Primary Resources: This course is comprised of a range of different free, online materials. However, the course makes primary use of the following materials:
- David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. is the main text used in the course.
- Lectures from Berkeley, and Yale complement the main text.
Requirements for Completion: In order to complete this course, you will need to work through each unit and all of its assigned materials. Listen to each of the lectures and read each of the assigned chapters from the text. Problem sets will be offered in each unit to help you complete the final exam, which consists of 50 multiple-choice questions.
Note that you will only receive an official grade on your final exam. However, in order to adequately prepare for this exam, you will need to work through the quizzes and problem sets listed above. In order to “pass” this course, you will need to earn a 70% or higher on the final exam. Your score on the exam will be tabulated as soon as you complete it. If you do not pass the exam, you may take it again.
Time Commitment: This course should take you a total of 90.5 hours to complete. Each unit includes a “time advisory” that lists the amount of time you are expected to spend on each subunit. These should help you plan your time accordingly. The required time to complete the course depends greatly on your proficiency in multi-variable calculus. Those students with a stronger quantitative background should find that information is presented in a straightforward fashion and that each unit should take approximately the listed time advisory to complete. Those students needing to further develop their calculus skills may take considerably longer to complete the course; it is possible to ponder a single equation for some time. It may be useful to take a look at these time advisories and to determine how much time you have over the next few weeks to complete each unit, and then to set goals for yourself based upon your proficiency with calculus. For example, unit 1 should take you about 17 hours to complete. Perhaps you can sit down with your calendar and decide to complete subunit 1.1 (a total of 3 hours) on Monday, subunit 1.2 (a total of 4 hours) on both Tuesday and Wednesday, etc.
Tips/Suggestions: As noted in the “Course Requirements,” multi-variable calculus (MA103) is a pre-requisite for this course. If you are struggling with the mathematics as you progress through this course, consider taking a break to revisit MA103, focusing especially on optimization techniques. Do not get discouraged if some of the equations look daunting; try to break them down and understand what they mean in terms of theory or applications. For example, you can write what a concept means in words and then compare it to how same ideas are expressed in an equation. Usually, the individual terms (or parts) of an equation correspond to a particular theory or policy implication. This should help you understand how the theory, policy issues, and quantitative methods relate to each other. After a set time, perhaps 15 minutes, set any puzzling material aside and return to it later with a fresh perspective.
Many of the assumptions in the models are somewhat unrealistic on first inspection. For example, certain functions are used more for their differentiability rather than for their ability to describe real-world phenomena. As you progress in economics, these assumptions can be relaxed to build models that better approximate the actual environment.
Learning Outcomes showclose
- Explain the standard theory in macroeconomics at an intermediate level.
- Explain and use the basic tools of macroeconomic theory, and apply them to help address problems in public policy.
- Analyze the role of government in allocating scarce resources.
- Explain how inflation affects entire economic systems.
- Synthesize the impact of employment and unemployment in a free market economy.
- Build macroeconomic models to describe changes over time in monetary and fiscal policy.
- Compare and contrast arguments concerning business, consumers and government, and make good conjectures regarding the possible solutions.
- Analyze the methods of computing and explaining how much is produced in an economy.
- Apply basic tools that are used in many fields of economics, including uncertainty, capital and investment, and economic growth.
Course Requirements showclose
√ Have access to a computer.
√ Have continuous broadband Internet access.
√ Have the ability/permission to install plug-ins or software (e.g. Adobe Reader or Flash).
√ Have the ability to download and save files and documents to a computer.
√ Have the ability to open Microsoft files and documents (e.g. .doc, .ppt, .xls, etc.).
√ Be competent in the English language.
√ Have read the Saylor Student Handbook.
√ Have completed the following courses: ECON101: Principles of Microeconomics; ECON102: Principles of Macroeconomics; ECON103/MA101: Single-Variable Calculus I; MA103: Multivariable Calculus; ECON104/MA121: Introduction to Statistics.Unit Outline show close
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Unit 1: Gross Domestic Product & Decisions Under Uncertainty
Gross Domestic Product (GDP) is the main measure economists use to explain how much an economy produces at any given time. Over time, trends can be identified and patterns of growth and contraction can be seen. Inflation, or the general rise of prices, affects how GDP is measured, and economists have to account for variations in measurement tools and approaches. No one measurement system or technique is most accurate all of the time. Different schools of thought consider how to calculate and interpret GDP from their own perspectives.
Unit 1 Time Advisory show close
Decisions are often made with incomplete knowledge under shifting economic, political, and social conditions. Determining how best to estimate and compensate for uncertainty is a complex process; macroeconomists use mathematical techniques to approximate real-world choices and outcomes. Decisions under uncertainty draw on a variety of techniques, including game theory, statistical analysis, and calculus.
Unit 1 Learning Outcomes show close
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1.1 Gross Domestic Product
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 1: The Gross Domestic Product: pages 1 to 24 and 31 to 36.”
Link: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. (PDF) “Chapter 1: The Gross Domestic Product: pages 1 to 24 and 31 to 36.”
Instructions: When you click on the link above, you will be directed to an archive of the text. Click on the PDF image at the top of the page to download the PDF file. This is an Adobe Acrobat file that requires Adobe Acrobat Reader, which can be downloaded free at Adobe’s site. Read pages 1 to 24 and 31 to 36 in chapter 1. Note: These are the page numbers of the document, not the PDF page numbers. Think about how economists calculate GDP and take inflation into account. Consider different approaches to estimating GDP.
Terms of Use: Please respect the copyright and terms of use displayed on the webpage above.See a broken link? Please let us know!
- Lecture: iTunes U: Berkeley University’s Department of Economics: Steven Wood’s “Lecture 1” and “Lecture 2.”
Link: iTunes U: Berkeley University’s Department of Economics: Steven Wood’s “Lecture 1” and “Lecture 2.” (iTunes U)
Instructions: Click on the “View in iTunes” hyperlink for items titled “Lecture 1” and “Lecture 2.” Listen to the entirety of both lectures (150 minutes).
Terms of Use: Please respect the copyright and terms of use displayed on the webpage above.See a broken link? Please let us know!
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 1: The Gross Domestic Product: pages 1 to 24 and 31 to 36.”
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1.2 Trends and Cycles
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 1: The Gross Domestic Product: pages 25 to 30.”
Link: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. (PDF) “Chapter 1: The Gross Domestic Product: pages 25 to 30.”
Instructions: When you click on the link above, you will be directed to an archive of the text. Click on the PDF image at the top of the page to download the PDF file. This is an Adobe Acrobat file that requires Adobe Acrobat Reader, which can be downloaded free at Adobe’s site. Read pages 25 to 30 in chapter 1. Note: These are the page numbers of the document, not the PDF page numbers. Think about the ways economists describe how trends and cycles emerge and change. Consider how different economic interpretations may impact decisions.
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- Lecture: iTunes U: Berkeley University’s Department of Economics: Steven Wood’s “Lecture 10.”
Link: iTunes U: Berkeley University’s Department of Economics: Steven Wood’s “Lecture 10.” (iTunes U)
Instructions: Click on the “View in iTunes” hyperlink for the item titled “Lecture 10.” Listen to the entire lecture (75 minutes).
Terms of Use: Please respect the copyright and terms of use displayed on the webpage above.See a broken link? Please let us know!
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 1: The Gross Domestic Product: pages 25 to 30.”
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1.3 Decisions Under Uncertainty
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 3: Uncertainty and Expectations: pages 63 to 75.”
Link: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. (PDF) “Chapter 3: Uncertainty and Expectations: pages 63 to 75.”
Instructions: When you click on the link above, you will be directed to an archive of the text. Click on the PDF image at the top of the page to download the PDF file. This is an Adobe Acrobat file that requires Adobe Acrobat Reader, which can be downloaded free at Adobe’s site. Read all of chapter 3, pages 63 to 75.” Note: These are the page numbers of the document, not the PDF page numbers. Consider a time you had to make a decision under uncertain conditions. How did you approach it? Also, think about how national policies can either create or reduce uncertainty.
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- Lecture: iTunes U: Yale University’s Department of Finance: John Geanakoplos’ “14 - Quantifying Uncertainty” and “15 - Uncertainty and the Rational Expectations Model.”
Link: iTunes U: Yale University’s Department of Finance: John Geanakoplos’ “14 - Quantifying Uncertainty” and “15 - Uncertainty and the Rational Expectations Model.” (iTunes U)
Lecture 14 Also Available in:
Adobe Flash, mp3, or Quicktime
YouTube
Lecture 15 Also Available in:
Adobe Flash, mp3, or Quicktime
YouTube
Instructions: Click on the “View in iTunes” hyperlink for the following lectures: “14 - Quantifying Uncertainty” and “15 - Uncertainty and the Rational Expectations Model.” View each of these lectures in their entirety (150 minutes total).
Terms of Use: Please respect the copyright and terms of use displayed on the webpage above.See a broken link? Please let us know!
- Assessment: The Saylor Foundation's "Problem Set 1"
Link: The Saylor Foundation’s “Problem Set 1” (PDF)
Instructions: Please download the quiz linked above, and answer each question before checking your answers against The Saylor Foundation’s “Problem Set 1 Answer Key” (PDF).See a broken link? Please let us know!
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 3: Uncertainty and Expectations: pages 63 to 75.”
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Unit 2: Output, Employment, and Unemployment
Individuals must make a choice between spending their time working or pursuing other activities like raising a family, leisure, or enhancing health and wellness. When individuals offer their services for work, they receive a wage in exchange for giving up alternative choices. Commensurate with the individual’s choice, firms must also demand labor for an employment market to exist. When the wage individuals demand equals the wage offered by firms, equilibrium exists.
Unit 2 Time Advisory show close
The government is very active in most labor arrangements. Aside from regulating the work environment, government typically provides minimum guarantees of wage, unemployment insurance, and a system of income in retirement. Macroeconomists have various ways of modeling the trends, effects, and causes of unemployment. Sustained high levels of unemployment may lead to societal difficulties.
Unit 2 Learning Outcomes show close
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2.1 Output and Employment
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 2: Output and Employment: pages 38 to 52 and 58 to 61.”
Link: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. (PDF) “Chapter 2: Output and Employment: pages 38 to 52 and 58 to 61.”
Instructions: When you click on the link above, you will be directed to an archive of the text. Click on the PDF image at the top of the page to download the PDF file. This is an Adobe Acrobat file that requires Adobe Acrobat Reader, which can be downloaded free at Adobe’s site. Read chapter 2, pages 38 to 52 and 58 to 61. Note: These are the page numbers of the document, not the PDF page numbers. Consider a time you had to make a decision about whether to work or do something else. Think about how that choice is replicated throughout an entire economy.
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- Lecture: iTunes U: Berkeley University’s Department of Economics: Steven Wood’s “Lecture 3.”
Link: iTunes U: Berkeley University’s Department of Economics: Steven Wood’s “Lecture 3.” (iTunes U)
Instructions: Click on the “View in iTunes” hyperlink for the item titled “Lecture 3.” Listen to the entire lecture (75 minutes).
Terms of Use: Please respect the copyright and terms of use displayed on the webpage above.See a broken link? Please let us know!
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 2: Output and Employment: pages 38 to 52 and 58 to 61.”
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2.2 Business Cycle and Policies
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 2: Output and Employment: pages 53 to 57.”
Link: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. (PDF) “Chapter 2: Output and Employment: pages 53 to 57.”
Instructions: When you click on the link above, you will be directed to an archive of the text. Click on the PDF image at the top of the page to download the PDF file. This is an Adobe Acrobat file that requires Adobe Acrobat Reader, which can be downloaded free at Adobe’s site. Read chapter 2, pages 53 to 57. Note: These are the page numbers of the document, not the PDF page numbers. Analyze how the business cycle affects trends in employment and how national policies can stabilize the labor market.
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- Lecture: iTunes U: Berkeley University’s Department of Economics: Steven Wood’s “Lecture 19.”
Link: iTunes U: Berkeley University’s Department of Economics: Steven Wood’s “Lecture 19.” (iTunes U)
Instructions: Click on the “View in iTunes” hyperlink for the item titled “Lecture 19.” Listen to the entire lecture (75 minutes).
Terms of Use: Please respect the copyright and terms of use displayed on the webpage above.See a broken link? Please let us know!
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 2: Output and Employment: pages 53 to 57.”
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2.3 Unemployment
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 4: Unemployment: pages 77 to 97.”
Link: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. (PDF) “Chapter 4: Unemployment: pages 77 to 97.”
Instructions: When you click on the link above, you will be directed to an archive of the text. Click on the PDF image at the top of the page to download the PDF file. This is an Adobe Acrobat file that requires Adobe Acrobat Reader, which can be downloaded free at Adobe’s site. Read chapter 4, pages 77 to 97. Note: These are the page numbers of the document, not the PDF page numbers. Consider how various wages are arrived at, and the role of government in bridging income gaps with unemployment insurance.
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- Lecture: iTunes U: Berkeley University’s Department of Economics: Steven Wood’s “Lecture 4” and “Lecture 22.”
Link: iTunes U: Berkeley University’s Department of Economics: Steven Wood’s “Lecture 4” and “Lecture 22.” (iTunes U)
Instructions: Click on the “View in iTunes” hyperlink for items titled “Lecture 4” and “Lecture 22.” Listen to the entire lectures (150 minutes).
Terms of Use: Please respect the copyright and terms of use displayed on the webpage above.See a broken link? Please let us know!
- Assessment: The Saylor Foundation's "Problem Set 2"
Link: The Saylor Foundation’s “Problem Set 2” (PDF)
Instructions: Please download the quiz linked above, and answer each question before checking your answers against The Saylor Foundation’s “Problem Set 2 Answer Key” (PDF).See a broken link? Please let us know!
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 4: Unemployment: pages 77 to 97.”
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Unit 3: Consumption, Savings, Capital and Investment
Households are generally defined as the owners of all factors of production in an economy. Since households provide the factor services of labor, land, capital, and ownership to businesses, they receive payment in the form of wages, rent, interest, and profits. When we talk about “household behavior” in this unit, we mean the decisions that households make in various contexts—such as decisions concerning consumption, savings, investments in education and training.
Unit 3 Time Advisory show close
“Firm behavior” is primarily concerned with boosting efficiency and productivity in the production of goods and services. The firm’s decision-making processes center upon technology, entrepreneurship, innovation, employment relations, outsourcing, and competition policy. The interplay of decisions between households and firms is critical to maintaining a flow of goods, services, and incomes in a complex economy. This unit focuses on the decisions made by households and firms, the factors the influence those decisions (such as the trade balance, and interest rates faced by firms), and their effects on the macroeconomy.
Most of us are familiar with the interest paid on deposits or the interest paid on a mortgage. This unit will discuss this concept in macroeconomic terms. It will explain that individuals and firms need money in the present in order to operate, so when money is borrowed for use, a payment is made for its use over a period of time. We call these payments interest rates. As with the price of anything, if demand increases for the use of money, then its price (the interest rate) also rises.
Unit 3 Learning Outcomes show close
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3.1 Consumption and Savings
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 5: Consumption and Saving: pages 99 to 127.”
Link: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. (PDF) “Chapter 5: Consumption and Saving: pages 99 to 127.”
Instructions: When you click on the link above, you will be directed to an archive of the text. Click on the PDF image at the top of the page to download the PDF file. This is an Adobe Acrobat file that requires Adobe Acrobat Reader, which can be downloaded free at Adobe’s site. Read chapter 5, pages 99 to 127. Note: These are the page numbers of the document, not the PDF page numbers. Consider the relationship between consumer demand and the level of savings. Analyze the effect on the international position of the economy and the market level of interest rates.
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- Lecture: iTunes U: Berkeley University’s Department of Economics: Steven Wood’s “Lecture 5” and “Lecture 6.”
Link: iTunes U: Berkeley University’s Department of Economics: Steven Wood’s “Lecture 5” and “Lecture 6.” (iTunes U)
Instructions: Click on the “View in iTunes” hyperlink for items titled “Lecture 5” and “Lecture 6.” Listen to the entirety of both lectures (150 minutes total).
Terms of Use: Please respect the copyright and terms of use displayed on the webpage above.See a broken link? Please let us know!
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 5: Consumption and Saving: pages 99 to 127.”
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3.2 Capital and Investment
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 7: Capital and Investment: pages 155 to the top of page 163.”
Link: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. (PDF) “Chapter 7: Capital and Investment: pages 155 to the top of page 163.”
Instructions: When you click on the link above, you will be directed to an archive of the text. Click on the PDF image at the top of the page to download the PDF file. This is an Adobe Acrobat file that requires Adobe Acrobat Reader, which can be downloaded free at Adobe’s site. Read chapter 7, pages 155 to 163. Note: These are the page numbers of the document, not the PDF page numbers. Think about how interest rates are set relative to an open economy. Does the market always allocate the correct level of capital and investment?
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- Lecture: iTunes U: Berkeley University’s Department of Economics: Steven Wood’s “Lecture 7.”
Link: iTunes U: Berkeley University’s Department of Economics: Steven Wood’s “Lecture 7.” (iTunes U)
Instructions: Click on the “View in iTunes” hyperlink for the item titled “Lecture 7.” Listen to the entire lecture (75 minutes).
Terms of Use: Please respect the copyright and terms of use displayed on the webpage above.See a broken link? Please let us know!
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 7: Capital and Investment: pages 155 to the top of page 163.”
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3.3 IS-LM Analysis
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 7: Capital and Investment: pages 163 to 169.”
Link: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. (PDF) “Chapter 7: Capital and Investment: pages 163 to 169.”
Instructions: When you click on the link above, you will be directed to an archive of the text. Click on the PDF image at the top of the page to download the PDF file. This is an Adobe Acrobat file that requires Adobe Acrobat Reader, which can be downloaded free at Adobe’s site. Read chapter 7, pages 163 to 169. Note: These are the page numbers of the document, not the PDF page numbers. Think about the effects of government decisions on interest rates and levels of investment.
Terms of Use: Please respect the copyright and terms of use displayed on the webpage above.See a broken link? Please let us know!
- Lecture: iTunes U: Berkeley University’s Department of Economics: Steven Wood’s “Lecture 11,” “Lecture 12,” “Lecture 13,” and “Lecture 14.”
Link: iTunes U: Berkeley University’s Department of Economics: Steven Wood’s “Lecture 11,” “Lecture 12,” ‘Lecture 13,” and “Lecture 14.” (iTunes U)
Instructions: Click on the “View in iTunes” hyperlink for items titled “Lecture 11,” “Lecture 12,” “Lecture 13,” and “Lecture 14.” Listen to the entire lectures (300 minutes total).
Terms of Use: Please respect the copyright and terms of use displayed on the webpage above.See a broken link? Please let us know!
- Assessment: The Saylor Foundation’s “Problem Set 3”
Link: The Saylor Foundation’s “Problem Set 3” (PDF)
Instructions: Please download the quiz linked above, and answer each question before checking your answers against The Saylor Foundation’s “Problem Set 3 Answer Key” (PDF).See a broken link? Please let us know!
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 7: Capital and Investment: pages 163 to 169.”
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Unit 4: Fiscal Policy
Fiscal policy describes the government’s spending and taxing decisions. The economic objective of government is to maximize social well-being while operating within a budget. The government’s role in the economy is complex, and economic models attempt to account for the far-reaching effects of policy decisions. Simple one-period or static models lay the foundation for analyzing short-term effects of taxing and spending decisions. Dynamic multiperiod models are then constructed to better explain the ripple effects of government policies.
Unit 4 Time Advisory show close
Every government faces the choice to either raise revenue through taxes or borrow funds by issuing bonds. There is no one correct decision, and tradeoffs must be considered. A well-thought-out policy will incorporate external factors like the current business cycle, international developments, and demographic changes. For example, increased taxation tends to slow economic activity yet limits the amount of debt. Aside from economic considerations, optimal tax and borrowing policies must factor in the political process. A final policy is a compromise among many stakeholders, and good fiscal policy analysis is framed by political forces.
Unit 4 Learning Outcomes show close
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4.1 Static Models of Spending and Taxation
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 6: Fiscal Policy: pages 129 to 141.”
Link: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. (PDF) “Chapter 6: Fiscal Policy: pages 129 to 141.”
Instructions: When you click on the link above, you will be directed to an archive of the text. Click on the PDF image at the top of the page to download the PDF file. This is an Adobe Acrobat file that requires Adobe Acrobat Reader, which can be downloaded free at Adobe’s site. Read chapter 6, pages 129 to 141. Note: These are the page numbers of the document, not the PDF page numbers. Think about how spending and taxation affect a static model with no dynamic changes. Consider how different kinds of taxes affect the economy.
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- Lecture: iTunes U: Berkeley University’s Department of Economics: Steven Wood’s “Lecture 17.”
Link: iTunes U: Berkeley University’s Department of Economics: Steven Wood’s “Lecture 17.” (iTunes U)
Instructions: Click on the “View in iTunes” hyperlink for the item titled “Lecture 17.” Listen to the entire lecture (75 minutes).
Terms of Use: Please respect the copyright and terms of use displayed on the webpage above.See a broken link? Please let us know!
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 6: Fiscal Policy: pages 129 to 141.”
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4.2 Dynamic Models of Spending and Taxation
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 6: Fiscal Policy: pages 142 to 151.”
Link: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. (PDF) “Chapter 6: Fiscal Policy: pages 142 to 151.”
Instructions: When you click on the link above, you will be directed to an archive of the text. Click on the PDF image at the top of the page to download the PDF file. This is an Adobe Acrobat file that requires Adobe Acrobat Reader, which can be downloaded free at Adobe’s site. Read chapter 6, pages 142 to 151. Note: These are the page numbers of the document, not the PDF page numbers. Think about how spending and taxation affect a dynamic model, as compared to the static ones in the last section. Consider how different kinds of policies, like sustained interventions and shocks, affect the economy.
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- Lecture: iTunes U: Berkeley University’s Department of Economics: Steven Wood’s “Lecture 18.”
Link: iTunes U: Berkeley University’s Department of Economics: Steven Wood’s “Lecture 18.” (iTunes U)
Instructions: Click on the “View in iTunes” hyperlink for the item titled “Lecture 18.” Listen to the entire lecture (75 minutes).
Terms of Use: Please respect the copyright and terms of use displayed on the webpage above.See a broken link? Please let us know!
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 6: Fiscal Policy: pages 142 to 151.”
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4.3 Taxes vs. Borrowing
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 6: Fiscal Policy: pages 152 to 154.”
Link: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. (PDF) “Chapter 6: Fiscal Policy: pages 152 to 154.”
Instructions: When you click on the link above, you will be directed to an archive of the text. Click on the PDF image at the top of the page to download the PDF file. This is an Adobe Acrobat file that requires Adobe Acrobat Reader, which can be downloaded free at Adobe’s site. Read chapter 6, pages 152 to 154. Note: These are the page numbers of the document, not the PDF page numbers. Consider the pros and cons of borrowing and/or raising taxes to finance a deficit. When is each policy better than the other? (Hint: Think about economic cycles.)
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- Lecture: iTunes U: University of California, Davis’ Institute of Governmental Affairs: “Perspectives on the Obama Administration”: “Stimulus SmackDown: Can Deficit Spending Save the Economy?”
Link: iTunes U: University of California, Davis’ Institute of Governmental Affairs: “Perspectives on the Obama Administration”: “Stimulus SmackDown: Can Deficit Spending Save the Economy?” (iTunes U)
Instructions: Click on the “View in iTunes” hyperlink for item 4, titled “Stimulus SmackDown: Can Deficit Spending Save the Economy?” Listen to the entire audio lecture (110 minutes).
Terms of Use: Please respect the copyright and terms of use displayed on the webpage above.See a broken link? Please let us know!
- Assessment: The Saylor Foundation’s “Problem Set 4”
Link: The Saylor Foundation’s “Problem Set 4” (PDF)
Instructions: Please download the quiz linked above, and answer each question before checking your answers against The Saylor Foundation’s “Problem Set 4 Answer Key” (PDF).See a broken link? Please let us know!
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 6: Fiscal Policy: pages 152 to 154.”
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Unit 5: Monetary Policy
This unit will teach you how economists think about money. For economists, money is something that produces money services—in other words, any commodity, document, token, or claim that can be used as a medium of exchange and that people demand for that purpose. If the value of a given asset rises because people demand its services, we call that asset “money” or “money assets.” Over time, as different demands for money services arise, new instruments emerge to supply those services. This unit looks at the different motives for demanding money and different forms used to supply the demand. We also explore the role of institutions in regulating money.
Unit 5 Time Advisory show close
Unit 5 Learning Outcomes show close
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5.1 Overlapping Generations Model
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 8: Money and Inflation: pages 172 to the top of page 175.”
Link: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. (PDF) “Chapter 8: Money and Inflation: pages 172 to the top of page 175.”
Instructions: When you click on the link above, you will be directed to an archive of the text. Click on the PDF image at the top of the page to download the PDF file. This is an Adobe Acrobat file that requires Adobe Acrobat Reader, which can be downloaded free at Adobe’s site. Read chapter 8, pages 172 to the top of 175. Note: These are the page numbers of the document, not the PDF page numbers. Think about how this tool explains the transfer of wealth over generations.
Terms of Use: Please respect the copyright and terms of use displayed on the webpage above.See a broken link? Please let us know!
- Lecture: iTunes U: Yale University’s Department of Finance: John Geanakoplos’ “12 – Overlapping Generations Model” and “13 – Demography and Asset Pricing.”
Link: iTunes U: Yale University’s Department of Finance: John Geanakoplos’ “12 – Overlapping Generations Model” and “13 – Demography and Asset Pricing.” (iTunes U)
Lecture 12 Also Available in:
Adobe Flash, mp3, or Quicktime
YouTube
Lecture 13 Also Available in:
Adobe Flash, mp3, or Quicktime
YouTube
Instructions: Click on the “View in iTunes” hyperlink for the following lectures: “12 – Overlapping Generations Model” and “13 – Demography and Asset Pricing.” (150 minutes) View each of these lectures in their entirety.
Terms of Use: Please respect the copyright and terms of use displayed on the webpage above.See a broken link? Please let us know!
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 8: Money and Inflation: pages 172 to the top of page 175.”
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5.2 Monetary Policy and Inflation
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 8: Money and Inflation: pages 175 to the top of page 194.”
Link: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. (PDF) “Chapter 8: Money and Inflation: pages 175 to the top of page 194.”
Instructions: When you click on the link above, you will be directed to an archive of the text. Click on the PDF image at the top of the page to download the PDF file. This is an Adobe Acrobat file that requires Adobe Acrobat Reader, which can be downloaded free at Adobe’s site. Read chapter 8, pages 175 to the top of 194. Note: These are the page numbers of the document, not the PDF page numbers. Think about how the role of money functions within an economy. Consider which policies work best in isolation and which are best used in an open economy.
Terms of Use: Please respect the copyright and terms of use displayed on the webpage above.See a broken link? Please let us know!
- Lecture: iTunes U: Berkeley University’s Department of Economics: Steven Wood’s “Lecture 23,” “Lecture 24,” and “Lecture 25.”
Link: iTunes U: Berkeley University’s Department of Economics: Steven Wood’s “Lecture 23,” “Lecture 24,” and “Lecture 25.” (iTunes U)
Instructions: Click on the “View in iTunes” hyperlink for items titled “Lecture 23,” “Lecture 24,” and “Lecture 25.” Listen to the entirety of these three lectures (225 minutes total).
Terms of Use: Please respect the copyright and terms of use displayed on the webpage above.See a broken link? Please let us know!
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 8: Money and Inflation: pages 175 to the top of page 194.”
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5.3 International Monetary Systems
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 8: Money and Inflation: pages 194 to 205.”
Link: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. (PDF) “Chapter 8: Money and Inflation: pages 194 to 205.”
Instructions: When you click on the link above, you will be directed to an archive of the text. Click on the PDF image at the top of the page to download the PDF file. This is an Adobe Acrobat file that requires Adobe Acrobat Reader, which can be downloaded free at Adobe’s site. Read chapter 8, pages 194 to 205. Note: These are the page numbers of the document, not the PDF page numbers. Think about how the international monetary system functions and how it might be in need of reform.
Terms of Use: Please respect the copyright and terms of use displayed on the webpage above.See a broken link? Please let us know!
- Lecture: iTunes U: Carnegie Council for Ethics in International Affairs’ Financial Crisis Audio: Joseph E. Stiglitz et al.’s “Reform of the International Monetary and Financial System”
Link: iTunes U: Carnegie Council for Ethics in International Affairs’ Financial Crisis Audio: Joseph E. Stiglitz et al.’s “Reform of the International Monetary and Financial System” (iTunes U)
Instructions: Click on the “View in iTunes” hyperlink for item 8: “Reform of the International Monetary and Financial System.” Listen to the entire lecture (90 minutes).
Terms of Use: Please respect the copyright and terms of use displayed on the webpage above.See a broken link? Please let us know!
- Assessment: The Saylor Foundation’s “Problem Set 5”
Link: The Saylor Foundation’s “Problem Set 5” (PDF)
Instructions: Please download the quiz linked above, and answer each question before checking your answers against The Saylor Foundation’s “Problem Set 5 Answer Key” (PDF).See a broken link? Please let us know!
- Reading: David Andolfatto’s Macroeconomic Theory & Policy, 2nd ed. “Chapter 8: Money and Inflation: pages 194 to 205.”
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Final Exam
- Final Exam: The Saylor Foundation's ECON202 Final Exam
Link: The Saylor Foundation's ECON202 Final Exam
Instructions: You must be logged into your Saylor Foundation School account in order to access this exam. If you do not yet have an account, you will be able to create one, free of charge, after clicking the link.
Note: The Saylor Foundation does not yet have materials for this portion of the course.See a broken link? Please let us know!
- Final Exam: The Saylor Foundation's ECON202 Final Exam
