Economics 3102, Summer 2004


General information

Course Objectives:

This course is designed to deepen your understanding of macroeconomics, using a unifying general equilibrium life cycle model. The model will shed light into the joint determination of output and price level, and consequently on economic growth and inflation. We will discuss also the problem of unemployment and government policy, using also the Keynesian model. We will also address open economy aspects (international economics) and we will discuss the modern financial markets and institutions.

Click here to see a synopsis of the course.


Macroeconomics: An integrated approach, 2nd edition, A.J. Auerbach and L.J. Kotlikoff (MIT Press, Harcourt College Publishers, 1999)

WWW Homepage

The URL for the first three weeks of the class is , and for the last three weeks is .

A copy of this syllabus is available online. Material from lectures will also be posted following the lectures. The homeworks will be available for downloading on the class homepage. The homepage also provides links to some web sites related to macroeconomics.


  Homework Assignments        30% 
  Midterm                    35%
  Final                      35%

There will be 4 homeworks, 2 for each part of the course. No late assignments are accepted. The homeworks must be typed (except graphs and formulas). The penalty for not typing is 25% (of the points at stake), i.e a perfect homework, but not typed will bring you only 75% of the potential score. The final is not cumulative, and will comprise the material taught in the last three weeks. The midterm and the final must be taken at the scheduled time.

Tentative Class Schedule

We will attempt to follow the schedule outlined below. It is advisable to do the readings before the lecture.





M 14 June

Introduction; Output, inputs and growth

Prologue; Ch 1


T 15 June

The dynamic supply of inputs I

Ch 1, Ch 2


W 16 June

The dynamic supply of inputs II

Ch 2


Th 17 June

The dynamic demand for inputs I

Ch 3


F 18 June

The dynamic demand for inputs II

Ch 3

HW1 handed out

M 19 June

The dynamic demand for inputs III. Evolution of Output (GE)

Ch 3


T 22 June

Economic Fluctuations

Ch 4

HW 2 handed out 

W 23 June

The measurement of output and prices

Ch 5


Th 24 June

Fiscal policy, saving, and growth I

Ch 6


F 25 June

Fiscal policy, saving, and growth II

Ch 6

HW 1 due

M 28 June

Money and prices in the closed economy I

Ch 7

HW 2 due

T 29 June

Money and prices in the closed economy II

Ch 7


W 30 June

Review for the midterm

Ch 1-7


Th 1 July




F 2 July

Discussion of Midterm



Introducing price and wage rigidities//Understanding recessions

Ch 8,9


The nature and costs of unemployment//Countercyclical policy

Ch 10,11


Saving and growth in the international economy

Ch 12


Money, exchange rates and policy in the open economy I

Ch 13


The banking system, the FED and the money supply

Ch 14


Saving behavior and credit markets

Ch 15


Financial markets and the investment decision

Ch 16



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