44710 - Macroeconomics I

Sharif University of TechnologyGraduate School of Management and Economics44710 - Macroeconomics IInstructor: Amineh Mahmoudzadeh, mahmoodzadeh@sharif.eduOffice: Room 113.Office Hours: Wednesdays 12:30 – 1:30 pm, and by appointment.Extra Office Hours & Review Sessions TBA before tests.Phone: 66165863Teaching Assistance:Saeed Aeenfard, saeed.aeen@gmail.comAmin Rahmati, m.amin.rhmti@gmail.comMaryam Rezaee, rezaei95.maryam@gmail.comAmirHossein Vaziri, amirhvaziri@yahoo.deOffice Hours: TBACourse Description: Macroeconomics is the study of the aggregate economy, or the economy asa whole. While microeconomics examines the choices of individual households and firms, andhow shocks and government policies can influence these decisions, macroeconomics examines thelong-run growth of an entire economy and short-run fluctuations around this trend. Growth theorydescribes and explains how the main economic aggregates evolve on average over long periods oftime, whereas business cycle theories which analyze the short-run movements of economicaggregates. The course is focused on: Introduction to Macroeconomics, Economic Growth,Business Cycles, Monetary Economics, Short-term Analysis and Open Economy.Prerequisites: Microeconomics IReferences:1. *[R] Romer, D., (2019), Advanced Macroeconomics, McGraw Hill, 5th ed.2. *[K] Kurlat: A Course in Modern Macroeconomics, 1st ed, 2020.3. *[M] Mishkin: The Economics of Money, Banking and Financial markets, 10th ed.4. *[N] دکتر مسعود نیلی ، مباحثی از اقتصاد کالن پیشرفته 5. [DLS] Doepke, Lehnert, Sellgren: Macroeconomics6. [Mw] Mankiw: Macroeconomics, 9th ed.7. [GLS] Garin, Lester and Sims: Intermediate Macroeconomics, 2018.8. [BF] Blanchard and Fisher, Lectures on Macroeconomics.9. [W] Wickens, A Course in Modern Macroeconomics, 2nd ed.1

Course Website:http://gsme.sharif.edu/ me/joinchat/IdV8qSJ9-s80YmkGrades:Problem sets (10): 25%Quiz (2-3): 10%Midterm (00/2/8): 20%Final Exam (00/3/31, 9:00): 30% (full coverage)Final Project (00/4/31): 10%Class Participation: 5%Changes in weights (up to 5%) may be applied due to realized contingencies.Problem Sets: Problem sets will be uploaded on , due date is right before class, the next week. You are supposed to organize your groups (2 or 3) and collaborate on solving problem sets,but please consider that each person should submit his/her own work. Please add the signed “Honor Code” as your homework’s cover letter. In case of copying, all participants get zero for the first time, the next time, the final scoreof problem sets and quizzes decreases to zero, and for the third practice the final scorewould be zero or you should drop the course. There is no extension, in case of emergency issues, please inform me with a validexplanation before the deadline. You can drop one problem set. If you want your problem sets re-graded, please send your request to TA within one weekupon the return of your problem set.Project:Please pick a country which has a notable experience of growth or stagflation, find at least 2related academic papers, summarize and present them. Your group should deliver a presentationand a written report till 1399/4/31.StepTopic selectionPaper selectionPrimitive PresentationPresentationSubmit project reportDue Date99/12/1699/2/400/3/2200/4/1900/4/262

Teaching Assistants:There are weekly TA sessions and TAs will go over the previous problem set in addition to someadditional helpful problems. Attending these sessions is extremely recommended; otherwise youmay lose lots of concepts and technical skills since they’re complementary to the class materials.Additionally, the TAs are holding weekly office hours to answer your questions. Please try to takeadvantage of these hours to resolve any problems you might have with the materials or homework.Communication:The materials and announcements will be uploaded on the course website and on Channel. Also,we email you the important announcements. Please, frequently check them.How to study (from here) :1. Don’t cram. Study over time by keeping up with the reading and exercises.2. Read or skim chapters before coming to class, then reread after class.3. Read actively, by taking notes and making an outline, and questioning yourself as youread. Note what you don’t understand.4. Stay focused and take good notes in class and try to follow the logic of the explanations.5. Review your notes after class, and before the next class.6. Be able to replicate graphs (shapes, labeling) and understand them, and apply them whena variable change.7. Work through lots of problems such as chapter problems and homework, and alwaysdraw a picture/graph when you can.8. Find a study partner or study group and explain concepts to each other.9. Ask me questions, both in class and at office hours, or via email. There is no such thingas a dumb question.Economics may be considered quite a difficult course because it involves abstract thinking. Youwill need to spend considerable time preparing for class, reviewing notes, and practicing problems.How do you know when you know the material?1. The standard of “knowing” is the ability to explain to others, not to just understand.2. Deep knowledge means understanding the facts and conclusions (the forest and the trees)and how they are interrelated.3. Strive for flexible knowledge over rote memorization.Don’t just be familiar with the subjects and vocabulary; develop an ability to precisely recall thematerial.3

Outline and Schedule:Week SessionDate1 Saturday 25 1112 Monday 27 113 Saturday 2 1224 Monday 4 123456785Saturday 967Monday 11Saturday 168Monday 189Saturday 2310Monday 2511Saturday 1412Monday 16131415Saturday 21Monday 23Saturday 2816Monday 30Main Subject1.IntroductionSubjectTAIntroduction2.2.Some Basic Facts about Economic GrowthWS-Data2.3.The Solow Growth Model2.3.1. AssumptionsWS-Data2.3.2. The Dynamics of the Model2.The Economic Growth2.3.3. The Impact of a Change in the Saving Rate2.3.4. Quantitative Implications122.3.5. The Solow Model and the Central Questions of Growth Theory2.3.6. Empirical Applications2.4.TFP Differences123.1.Consumption and SavingPS013.1.1. Keynesian123.1.2. Two Period Model3.1.3. Many periods12PS023.1.4. Behavioral Theories123.2.Labor and Leisure3.2.1. Measuring the Labor Market3.2.2. Static Model3.2.3. Evidence12Q013.2.4. A Dynamic Model3.2.5. Equilibrium in the Labor Market1 3.Microeconomic Foundations 3.3.Investment3.3.1. Present Values3.3.2. Risk3.3.3. Investment and the Cost of Capital1PS033.3.4. A Model of Investment with Adjustment Costs3.3.5. Tobin’s q13.4.General Equilibrium3.4.1. Two-Period Economy1PS043.4.2. Infinite-Period Economy13.4.3. RCK Model3.4.3.1.The Behavior of Households and Firms1PS053.4.3.2.The Dynamics of the Economy4

Week Session910111213141718Saturday 4Monday 619Saturday 112021Monday 13Saturday 1822Monday Monday nday151617Date2527138151722242931Main SubjectSubjectTA3.4.3.3.Welfare3.4.3.4.The Balanced Growth Path3.4.3.5.The Effects of change in the Discount Rate3.4.3.6.The Effects of Government Purchases24.1.What are Business Cycles?4.2.A Two-Period Model2Mid4.3.Markets4.Real Business Cycles4.4.Productivity Shocks24.5.Other Shocks4.6.Assessment25.1.MoneyWS-Data5.2.What is Money?25.3.The Supply of Money5.4.The Demand for Money5.Money and Inflation5.5.The Price Level and e Cost of Inflation26.1.Monopoly Power6.2.Sticky tickyPrices36.The New Keynesian Model 6.6.The Phillips Curve and the Short-Run Aggregate Supply Curve6.7.Fiscal and Monetary Policy6.8.Expectations3Q026.9.Lucas Imperfect-Information Model6.10. Monetary Policy Regimes6.11. The Liquidity Trap33PS097.1.Mundell-Fleming7.Open Economy7.2.Exchange Rate Overshooting33PS1033Final5

6

Course Description: Macroeconomics is the study of the aggregate economy, or the economy as . The course is focused on: Introduction to Macroeconomics, Economic Growth, Business Cycles, Monetary Economics, Short-term A