After completion of this course the students should understand how microeconomics differs from macroeconomics and they should be familiar with important macroeconomic facts, problems, and basic macroeconomic theories. More specifically, they can:
- describe, interpret and apply specific macroeconomic concepts,
- explain the general concept of economic modelling,
- analyse and interpret important macroeconomic facts, problems, and link them to basic macroeconomic theories,
- identify which factors determine long term economic growth and how these factors influence that path,
- calculate, visualize and discuss how macroeconomic policies and shocks affect a closed economy in the short run and the long run,
- calculate, visualize and discuss how macroeconomic policies and shocks affect an open economy in the long run,
- solve and discuss macroeconomic problems in a group.
In the first part of the course, the students learn the basic mathematical and graphical tools used for macroeconomic analysis and they learn how macroeconomics relates to microeconomics.
Subsequently, they learn determinants of long-run economic output, average inflation, and structural unemployment, as well as their measurement. Concluding this first part, the students learn some aspects of international economics, such as how exchange rates, capital flows between countries, and the trade balance are affected by policies and shocks.
In the second part of the course the students learn which factors determine long term economic growth and how these factors influence that path. In the final part of the course, recessions and booms are studied, where business cycles are understood as short-run deviations of economic activity around the long-run levels determined in the first part. Students learn how macroeconomic policies and shocks affect economic output, employment and interest rates in the short run.
All parts discuss to what extent governments and central banks can influence the economy using fiscal, monetary and other types of policy.