EC442      One Unit
Macroeconomics for MRes students

This information is for the 2025/26 session.

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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 sticky Prices, credit frictions, open economy dimensions.

60 hours of lectures and 30 hours of classes.

Attendance at classes is compulsory. We may run a lecture/seminar in ST week 1.

Compulsory exercises are set for each class. A mock exam will take place in early WT.

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.

For the monetary economics part of the course, the main references are:

 Jordi Galí, 2015. "Monetary Policy, Inflation, and the Business Cycle: An Introduction to the New Keynesian Framework and Its Applications Second edition," Economics Books, Princeton University Press, edition 2.

Michael Woodford, 2007. Interest and Prices: Foundations of a Theory of Monetary Policy.  Princeton University Press.

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.

Exam (75%), duration: 180 Minutes, reading time: 15 minutes in the Spring exam period

Continuous assessment (25%)