**Academic Year/course: 2017/18**

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**417 - Degree in Economics**

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**27428 - Macroeconomics III**

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Syllabus Information
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__Syllabus Information__

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**5.3. Syllabus**

**Part 1. Introduction and basic model:**

**Lesson 1: The structure of the short-run basic macroeconomic model **

1.INTRODUCTION: The macroeconomic problems. The facts to be explained. Intermediate macroeconomy explained in the second year of the degree. The limitation of the static models. Brief synthesis of the current state of the macroeconomic knowledge.

2. CHARACTERISTICS OF THE SHORT-RUN BASIC MODELS: Agents, markets, equations for agent’s behaviour and equilibrium conditions. Three typical models: classic model, keynesian model and Tobin’s model. Properties of the models.

3. KEYNESIAN MODEL: Resolution of the equilibrium and effects of exogenous changes.

4. CLASSICAL MODEL: Resolution of the equilibrium and effects of exogenous changes.

5. TOBIN’S MODEL: Resolution of the equilibrium and effects of exogenous changes.

6. DISCUSSION ON THE RELEVANCE OF THE DIFFERENT MODELS.

**Part 2. Macroeconomic consistency and microeconomic foundations:**

**Lesson 2: Macroeconomic consistency**

1. PRELIMINARS: Agents and assumptions on their behaviour. Macroeconomic wealth definition. Discrete and continuous time. Ex-ante and ex-post situations . Expectations. Notation.

2. BUDGET RESTRICTIONS OF THE AGENTS IN DISCRETE TIME

3. BUDGET RESTRICTIONS OF THE AGENTS IN CONTINUOUS TIME

4. EX-POST SAVINGS-INVESTMENT RELATIÓNSHIP

5. AN EXPLICIT CONSIDERATIÓN OF THE FINANCIAL SYSTEM

**Lesson 3: Microeconomic foundations: consumption, investment and money demand:**

1. THE AGGREGATE CONSUMPTION DEMAND: The problems of the keynesian consumption funcion. The intertemporal decision. The permanent income hypothesis. The life-cycle hypothesis.

2. THE INVESTMENT FUNCTIÓN: Tobin’s q model.

3. THE MONEY DEMAND FUNTION: Justification. Tradicional formulations. Money chanel versus credit chanel in the monetary transmisión mechanism.

4. WAGE AND PRICE EQUATIONS: Phillips curve and its versions. Mark-up models.

**Part 3. Complete short-run model:**

**Lesson 4: A consistent macroeconomic model **

1. WEALTH EFFECTS: Equations, hypothesis, resolution and sufficient conditions for the existence of equilibrium.

2. CONSISTENT MODEL WITH WEALTH EFFECT: Resolution and effects of exogenous changes.

3. PARTICULAR MODELS: Resolution and effects of an exogenous changes compared to the consistent model with wealth effect. Model without wealth effect.

4. THE INFLUENCE OF THE CREDIT CHANEL.

**Part 4. Long-run model: **

**Lesson 5: The long-run consistent macroeconomic model **

1. DINAMIC MODELS AND EXPECTATIONS.

2. LONG-RUN MODEL IN CONTINUOUS TIME.

2.1. Model specification.

2.2. Definitions of equilibrium in dinamic models.

2.3 Steady state characterization.

2.4. Determination of the steady state values.

2.5. The effect of exogenous changes in the steady state.

2.6. The influence of the credit chanel.

3. OTHER SIMPLE DYNAMIC MODELS: THE SOLOW MODEL.

**APENDIX: MEDIUM TERM MODEL IN CONTINUOUS TIME **

A.1. The model.

A.2. Steady state characterization.

A.3. Determination of the steady state values.

A.4. Example of the effect of an exogenous change.