Transcript Course Objectives - Faculty Websites

ECON 303
Intermediate Macroeconomics
Instructor:
Bernard Malamud
–Office: BEH 502
Phone (702) 895 –3294
Fax:
895 – 1354
»Email: [email protected]
Website: www.unlv.edu/faculty/bmalamud
Office hours: MTWThF 9:30-11am; and by
appointment
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Course Objectives
Refresh your command of
• Macroeconomic terminology
 eco-talk
• Macro Facts
• Schools of thought
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Course Objectives
• Master MODELS
– Demand Side Models  AD
• Multiplier
• IS – LM
– Supply Side Models  AS
• Wage setting – Price setting
• Phillips Curve
– Expectations … in theory and practice
– Solow Growth Model
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b
Variables of Macroeconomics
l
• Output … Real GDP
e
• Unemployment
s
• Inflation … CPI, GDP Deflator
o
– Time-frames of macroanalysis
• Short-run … sticky prices
f
• Medium-run … prices adjust
• Long-run … capital accumulates
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Introduction
– What’s up … What’s down?
• Unemployment
• Oil price … the macro impacts
• $ Exchange Rate
»Inflation fears
• US trade deficit
–Emerging markets: INDIA,
CHI
NA
• Housing bubble
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Where to Find the Numbers
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http://research.stlouisfed.org/fred2/
www.bls.gov/data/
www.economist.com
www.bea.doc.gov
http://www.gpoaccess.gov/eop/
www.oecd.org
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Macro Pictures: Jobs
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Macro Pictures: Unemployment
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Macro Pictures: Fluctuations
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Macro Pictures: Growth
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Macro Pictures: Core Prices
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Macro Pictures: Budget Deficit
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Macro Pictures: Exchange Rate
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Macro Pictures: Payments Deficit
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Mock FOMC Presentations -- July 1, 2008
• 2 – 3 person team
Play a Governor of Federal Reserve or President of a District Reserve Bank
Powerpoint-assisted presentation
• the state of the national economy
– allude to current economic conditions in districts
– focus on the state of the national economy
• recommendation of why, whether and by how much to change the
federal funds rate.
• phrasing of the statement to be issued at the end of the mock FOMC
meeting.
• Governor of Federal Reserve or President of a District Bank
Familiarize yourself with your official’s positions
• recent speeches
• minutes of recent FOMC meetings.
• Seek guidance from your professor
– appointments will be arranged, the earlier the better.
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Macroeconomics
The course is divided in three parts: Short -run / Medium-run / Long-run
Short - run: IS / LM  AD
IS: Y = C + I + G
C = c0 + c1 YD = c0 + c1 (Y - T)
I = I0 + b1 Y - b2 i
 Y = {spending multiplier} x {autonomous spending}
LM: (M/P)d = (M/P)s
(M/P)d = L(Y,i)
Ms = [1/(c + r(1-c))]H
= {money multiplier}
x {monetary base}
Medium - run: AD/AS
IS/LM  AD
PS: P = (1+ μ)(W/A)
 SRAS and MRAS
PS/WS  AS
WS: W= Pe Ae f(u,z)
In medium - run, Pe = P  (W/P)WS = (W/P)PS = A / (1+ μ)
Natural/Structural/Equilibrium Rate of Unemployment (un )
“Full - employment” rate of output (YFE) The Green Shaft
When AD or AS shift: MR equilibrium  SR equilibrium P  new MR equilibrium
Productivity and equilibrium rate of unemployment:
Ae = A only in long - run  “Natural rate” decreases with unexpected increase in A
Long - run: Growth
Steady state: s(Y/AN) = (δ + gN + gA )(K/AN)
For simple Cobb-Douglas function: Y = Kα (AN)1-α  Y/AN = {s/((δ + gN + gA )}α/(1-α) 18
Golden - rule saving rate = α