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| Detailinformationen |
| Quellcurriculum |
Masterstudium Economics (Economic Policy Analysis) 2025W |
| Lernergebnisse |
Kompetenzen |
| (*)Students are able to set up the constrained optimization problem of an economic agent and derive the FOCs characterizing the associated optimal behavior. Students are able to derive and interpret changes in optimal behavior in response to changes in economic conditions (e.g. changes in fiscal or monetary policy).
Course Goals
The goal of this course is to familiarize students with the workhorse model in modern theoretical
macroeconomics – the so-called Dynamic General Equilibrium (DGE) model. The DGE model
is 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. Thus, it provides so-called microeconomic
foundations for macroeconomic concepts, such as aggregate consumption and real GDP.
At the end of this course, students understand how economic agents form rational expectations
and make optimal consumption, saving, and investment decisions as well as how this framework
can be used to analyze the aggregate effects of economic shocks and policy interventions.
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| Fertigkeiten |
Kenntnisse |
(*)- Learning Outcome 2 (LO2): Understand the intertemporal constraints of economic agents and set up their constrained optimization problems applying the method of Lagrange.
- Learning Outcome 3 (LO3): Solve for the constrained optimal behavior of economic agents and analyze how it depends on interest rates, subsidies, taxes and wages.
- Learning Outcome 4 (LO4): Evaluate how exogenous changes in fiscal and monetary policy affect the constrained optimal behavior of economic agents.
- Learning Outcome 5 (LO5): Check whether the theoretical predictions of DGE models are consistent with stylized business cycle facts observed in the data.
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(*)Learning Outcome 1 (LO1): Recall the fundamental assumptions underlying DGE models.
Course Content
- Introduction
- Consumption and Saving
- Labor and Leisure
- Investment
- General Equilibrium
- Real Business Cycle Theory
- The Monetary Economy
- The New Keynesian Model
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| Beurteilungskriterien |
(*)The final grade in this course is based on the homework assignments (50%) and the written exam (50%). The homework assignments, the final exam, and the retake exam are all graded based on the following grading scheme:
| Percent | Grade |
|---|
| 85 - 100 | 1 |
| 70 - 84 | 2 |
| 55 - 69,5 | 3 |
| 40 - 54,5 | 4 |
| 0 - 39,5 | 5 |
- Homework assignments: There (at least) 2 homework assignments, which count equally (25% each) towards the final grade in this course. Homework assignments may be solved individually or in small groups of up to 2 students.
- Written exam: The final and retake exam is closed-book (i.e. no course material or other aids allowed), must be solved individually, and comprises of theoretical derivations and interpretations of the results as well as conceptual questions about the assumptions of DGE models and stylized empirical facts.
Synchronization of learning outcomes and assessments:
- LO1: Written exam(s)
- LO2: Written exam(s) & Homework assignments
- LO3: Written exam(s) & Homework assignments
- LO4: Written exam(s) & Homework assignments
- LO5: Written exam(s) & Homework assignments
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| Lehrmethoden |
(*)This course combines different teaching and learning methods in order to
- maximize students’ understanding of the course content and methods,
- convey the intuition and economic interpretation of theoretical results,
- encourage students’ independent practice of the course material.
This includes the following:
- Teacher-centered lectures based on slides and selected textbook chapters
- Step-by-step derivation of formal and graphical solutions on the blackboard
- Homework assignments
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| Abhaltungssprache |
Englisch |
| Literatur |
(*)- Lecture slides (containing links to economic databases)
- Homework assignments & solutions
- Selected textbook chapters from:
- Kurlat, Pablo (2020). A Course in Modern Macroeconomics. Chapters 6–9, 12–13.
- Wickens, Michael (2008). Macroeconomic Theory – A Dynamic General Equilibrium Approach. Princeton University Press, Chapters 2, 4, 8–9, 13–14. alternatively: Second Edition (2012), Chapters 2, 4, 8{9, 14{15.
- Galí, Jordi (2008). Monetary Policy, Inflation, and the Business Cycle: An Introduction to the New Keynesian Framework. Chapters 2–5.
- Walsh, Carl E. (2003). Monetary Theory and Policy. 2nd Edition. Massachusetts Institute of Technology (MIT) Press, Chapters 2–3.
(Lecture slides, homework assignments & solutions are made available via KUSSS)
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| Lehrinhalte wechselnd? |
Nein |
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