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Prof Per Krusell TBA, Prof Benjamin Moll 32L.1.19, Dr Ethan Ilzetzki 32L.1.11 and Prof Ricardo Reis 32L.1.27

This course is compulsory on the MRes/PhD in Economics and MRes/PhD in Finance. This course is not available as an outside option.

The course will cover topics in advanced macroeconomics with emphasis on fundamentals and applications to recent theoretical advances:

i. Economic growth: Neoclassical Growth Model, Optimizing Behaviour in dynamic models under certainty, Endogenous Technological Change, Imitation and Convergence, Growth and Development Accounting, Appropriate Technology.

ii. Search and Matching: The Matching Model, Efficiency Wages, Growth and Unemployment.

iii. Dynamic Stochastic General Equilibrium Models : Real Business Cycles, applications to models of heterogeneous agents and open economy. Fiscal policy analysis.

iv. Monetary Economics: models with credit frictions, sticky prices, search.

30 hours of lectures and 15 hours of classes in the MT. 30 hours of lectures and 15 hours of classes in the LT.

This course is delivered through a combination of classes and lectures totalling a minimum of 45 hours across Michaelmas Term and Lent Term. This year, some or all of this teaching will be delivered through a combination of virtual classes, live streamed (recorded) lectures, and some flipped content delivered as short online videos.  Attendance at lectures and classes is compulsory.

Compulsory exercises are set for each class.

A good general textbook that is mostly below the level of the course is:

D Romer, Advanced Macroeconomics, McGraw-Hill Advanced Series in Economics, New York, 1996.

For the growth part the main references are the textbooks by:

D. Acemoglu, Introduction to Modern Economic Growth, Princeton University Press, 2009; R J Barro & X Sala-i-Martin, Economic Growth, McGraw-Hill, 1997.

Other useful texts include:

L Ljungqvist & T Sargent, Recursive Macroeconomic Theory, MIT Press, 2000; N Stokey & R E Lucas, Recursive Methods in Economic Dynamics, Harvard University Press, 1989.

More economic applications, with some required readings can be found in:

M Obstfeld & K Rogoff, Foundations of International Macroeconomics, MIT Press, 2000; P Aghion & P Howitt, Endogenous Growth Theory, MIT Press 1998; C A Pissarides, Equilibrium Unemployment Theory, MIT Press 2000.

References for recent theoretical advances published in the journals will be given during the course.

Online exam (75%, 4 hours 15 minutes) in the ST.
Problem sets (25%) in the MT and LT.

Some departments have produced short videos to introduce their courses. Please refer to the course selection videos index page for further information.