[ 971ATECMETK13 ] KS Monetary Economics: Theory and Policy

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Workload Education level Study areas Responsible person Hours per week Coordinating university
4 ECTS M2 - Master's programme 2. year Economics Jochen Güntner 2 hpw Johannes Kepler University Linz
Detailed information
Pre-requisites (*)keine (die Zulassung zum Studium vorausgesetzt)
Original study plan Master's programme Economics 2019W
Objectives The goal of this course is to familiarize students with the Dynamic General Equilibrium (DGE) model – the workhorse model in modern theoretical macroeconomics – and to show how it can be employed for monetary policy analysis. The DGE model represents an attempt to account for the optimizing behavior of economic agents at the household or firm level and its implications for the economy as a whole. As a consequence, it provides so-called microeconomic foundations for macroeconomic concepts such as aggregate consumption or real GDP.
  • Introduction: DGE vs. Traditional Macroeconomics
  • The Centralized Economy
  • The Decentralized Economy
  • The Monetary Economy
  • Imperfectly Flexible Prices
  • The Basic New Keynesian Model
  • Monetary Policy in the New Keynesian Model
  • Monetary Policy Tradeoffs: Discretion vs. Commitment
  • Unconventional Monetary Policy, Asset Pricing, or Financial Frictions in Macroeconomics (according to students’ interests)
Criteria for evaluation Homework Assignments, Written Exam
Methods Dynamic General Equilibrium Modelling
Language English
Study material Michael Wickens (2012): Macroeconomic Theory – A Dynamic Stochastic General Equilibrium Approach; 2nd Edition
Changing subject? No
Further information This course requires a fundamental knowledge of analytical tools, such as difference and differential calculus and optimization under constraints. Students’ knowledge of these tools and how to use them are refreshed through applications in class and occasional homework assignments.
On-site course
Maximum number of participants 200
Assignment procedure Assignment according to priority