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econ607-endress-fall03
Course: ECON 607, Fall 2003School: Hawaii
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OF UNIVERSITY HAWAII AT MANOA DEPARTMENT OF ECONOMICS Economics 607* Macroeconomic Theory I Fall 2003 Lecture: TR 6:00pm 8:00pm Room: BUSAD C102 Instructor: Lee H. Endress Office: Saunders 515 Phone: 971-8753 Email: endressl@apcss.org Course Descriptions: This course is an introduction to macroeconomic theory and analysis. A major theme of the course will be macroeconomic dynamics with emphasis on the...
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OF UNIVERSITY HAWAII AT MANOA DEPARTMENT OF ECONOMICS Economics 607* Macroeconomic Theory I Fall 2003 Lecture: TR 6:00pm 8:00pm Room: BUSAD C102 Instructor: Lee H. Endress Office: Saunders 515 Phone: 971-8753 Email: endressl@apcss.org
Course Descriptions: This course is an introduction to macroeconomic theory and analysis. A major theme of the course will be macroeconomic dynamics with emphasis on the neoclassical foundations of investment, capital theory, economic growth, and monetary theory. We begin with review of basic macroeconomic models and their dynamics, including IS-LM and AS-AD. The course will then introduce the technology of optimal control through the study of capital theory and investment. Optimal control and other dynamic methods will be applied to various models of economic growth. Next we consider models of overlapping generations and their use in policy analysis of issues such as national debt and social security. Three sessions will be devoted to the consideration of open economy macroeconomics. Finally, using neoclassical models, we will study the role of money in the economy. Required Texts: Heijdra and Van der Ploeg, Foundations of Modern Macroeconomics, Oxford, 2002 Romer, Advanced Macroeconomics (2nd Ed.), McGraw-Hill, 2001 Recommended Text: Weitzman, Income, Wealth and the Maximum Principle, Harvard, 2003 Other References: Aghion and Howitt, Endogenous Growth Theory, MIT, 1998 Barro and Sala-I-Martin, Economic Growth, MIT, 1999 Blanchard and Fischer, Lectures On Macroeconomics, MIT, 1989 Grading: Final Exam: Midterm Exam: Homework: Participation: 40% 30% 20% 10%
* Note: With the exception of sessions on open economy macroeconomics, ECON 607 will be taught jointly with ECON 609. Each class, however, will be graded separately. Student performance will only be assessed within each class rather than across the two classes. Each class will receive separate exams.
SYLLABUS Topic 1: Review of Basic Macro Models (4 sessions: Aug 26, 28; Sept 2, 4) Heijdra /Van der Ploeg, chapters 1 and 2 Romer, chapter 5 Topic 2: Economic Dynamics and Optimal Control (4 sessions: Sept 9, 11, 16, 18) Heijdra/Van der Ploeg, chapters 2 and 4 Weitzman, 1 chapters and 2 Dorfman (1969) Ramsey (1928) Topic 3: Models of Economic Growth (6 sessions: Sept 23, 25, 30; Oct 2, 7, 9) Heijdra/Van der Ploeg, chapter 14 Romer, chapters 1, 2A, and 3 Mankiw (1992, 1995) Lucas (1988) Romer (1986) Midterm: Oct 14 (Tuesday), 6:00pm 7:30pm Topic 4: Models of Overlapping Generations (4 sessions: Oct 16, 21, 23, 28) Heijdra/Van der Ploeg, chapters 16 and 17 Romer, chapter 2B Blanchard (1985) Diamond (1965) Midterm Review: Oct 30 (Thursday), 6:00pm 7:30pm Topic 5: Open Economy Macroeconomics (3 Tuesday sessions: Nov 4, 18, 25)* Heijdra/Van der Ploeg, chapter 11 Romer, chapter 5 Dornbusch (1976) Topic 6: Money (4 sessions: Dec 2, 4, 9, 11) Heijdra/Van der Ploeg, chapter 12 Brock (1975) Sidrauski (1967) Final: Dec 16 (Tuesday), 6:00pm 8:00pm * Note: Topic 5 is for ECON 607 students only and will be covered over the three Tuesday sessions indicated. There will be no class for ECON 607 on Thursdays Nov 6, 13, and 20.
PAPERS Neoclassical Foundations Ramsey, Frank (1928), A Mathematical Theory of Saving, Economic Journal Dorfman, Robert (1969), An Economic Interpretation of Optimal Control Theory, American Economic Review Weitzman, Martin (1976), On the Welfare Significance of National Product in a Dynamic Economy, Quarterly Journal of Economics Growth Theory Lucas, Robert (1988), On the Mechanics of Economic Development, Journal of Monetary Economics Mankiw, N Gregory et al (1992), A Contribution to the Empirics of Economic Growth, Quarterly Journal of Economics Romer, Paul (1986), Increasing Returns and Long-Run Growth, Journal of Political Economy Overlapping Generations Models Diamond, Peter (1965), National Debt in a Neoclassical Growth Model, American Economic Review Blanchard, Oliver (1985), Debt, Deficits, and Finite Horizons, Journal of Political Economy Open Economy Macroeconomics Dornbusch, Rudiger (1976), Expectations and Exchange Rate Dynamics, Journal of Political Economy Money and Inflation Brock, William (1975), A simple Perfect Foresight Monetary Model, Journal of Monetary Economics Sidrauski, Miguel (1967), Rational Choice and Patterns of Growth in a Monetary Economy, American Economic Review
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