This is a course in macroeconomic theory at the intermediate level. Macroeconomics is concerned with the behavior of the aggregate economy. In the course we will be examining macroeconomic data and studying models designed to help us understand those data.


This course will be taught from an equilibrium perspective. This means we will analyze environments in which economic agents optimize and in which aggregate consistency conditions hold. Understanding the concept of equilibrium will then be the single most important task of the course.
We will apply this equilibrium insight to discuss the theory of long-run economic growth and short-run economic fluctuations. Growth theory describes and explains how the main economic aggregates (such as output, employment, inflation, interest rates) evolve on average over long periods of time, whereas theories of short-run fluctuations (business cycle theories) analyze the short-run movements of economic aggregates. Once we have understood how the macroeconomy works, we can start analyzing macroeconomic policy, in particular fiscal policy (what are the macroeconomic effects of taxation, government spending, budget deficits, or surpluses) and monetary policy (what happens if the Central Bank increases or lowers the Federal Funds Rate). By the end of the course you should be able to construct a critical opinion about economic issues using good economic intuition and knowledge.