SPECIFIC SKILLS pursued in the course:

S1. Ability to bring rationality to the analysis and the description of the macroeconomic reality focusing on short-term issues.

S2. Ability to evaluate consequences of different macroeconomic policies and select the best one given the objectives in a short-term context.

S3. Ability to derive relevant information from macroeconomic data regarding short term issues, impossible to be recognized by non-professionals.

S4. Ability to analyze the effectiveness of active, passive, rules-based and discretionary policies in achieving the stabilization of the economy.

S5. Ability to write reports in the light of available statistical data of the macroeconomic magnitudes applying the acquired knowledge and making use of appropriate technological resources.

S6. Ability to model the behavior of some of the main economic aggregates from a microeconomic perspective.



The TARGETS of the subject, as a realization of its skills, are the following:

T1. Understand the impact of monetary and fiscal policy as a tool to stabilize the economy by reducing the severity of the effects of economic cycles.

T2. Use the IS-LM model to study the effect that fiscal policy and monetary policy have on interest rates and income in the short run in closed economies.

T3. Use the Mundell-Fleming model to assess the impact of fiscal policy and monetary policy in an open economy under fixed and flexible exchange rate regimes.

T4. Proper use of the concepts of aggregate demand and supply.

T5. Analyze and interpret the choice between inflation and unemployment in the short term through the Phillips curve.

T6. Use the concepts of rational and adaptive expectations ign the assessment of fiscal policy and monetary policy.

T7. Discuss the problems of measurement of the government deficit and alternative theories on government debt.

T8. Identify the impact of active and passive policies in the effect of economic fluctuations.

T9. Learn about the effects of economic policies managed on a discretionary basis or by fixed rules.

T10. Analyze the micro-foundations of aggregate consumption and investment demands.



EXPECTED OUTCOMES of the subject are:

O1. Interpret the assumptions and foundations of macroeconomic models for the study of short-term issues, being able to use graphical analysis and mathematically solve related problems.

O2. Analyze the effect of fiscal and monetary policies in the context of the models presented in the course.

O3. Write evaluative reports which, based on the results of a quantitative exercise, support simple economic policy recommendations.



The TRANSFERABLE SKILLS of the subject are:

T1. Identify relevant sources of economic information and analyze its content.

T2. Use communication and information technologies.

T3. Read and communicate in the professional field in more than one language, especially in English.

T4. Communicate fluently in the professional environment.

T5. Work as a team.

Block 1:

1- Aggregate demand in a closed economy I. Building the IS-LM model.

2- Aggregate demand in a closed economy II. Applying the IS-LM model.

3- Aggregate demand in the open economy. The Mundell-Fleming model.

4- Aggregate supply and the short-run trade-off between inflation and employment. The Phillips Curve.

Block 2:

5- Microfoundations of the Theory of Consumption in Macroeconomics.

6- Stabilization policy: Rules and discretion. Time inconsistency.

7- Budget deficits and the public debt. The Ricardian Equivalence.

8- Microfoundations of the Theory of Investment in Macroeconomics.

[1] The timing of the distribution of the different sessions throughout the semester (time schedule) will be presented at the beginning of the teaching season and will take into account, in any case, the time schedules determined by the Office of the Dean.



[2] The complementary teaching materials that the teacher finds appropriate for this course will be made available through the teaching platform used in the UPV/EHU, eGELA.

A. ORDINARY CALL



1. Evaluation by continuous assessment. It comprises the following items:



a) An individual exam with theoretical/practical questions.

b) A teamwork exam with theoretical/practical questions.

c) Individual assignments that will be proposed throughout the course. In this section the teacher will value the active and positive participation of students in class meetings, such as, for instance, resolution of problems on the blackboard.

d) A final exam with theoretical/practical questions. The final exam will be held on the date and place set by the Office of the Dean. Anyone not taking the final exam will be graded as “absent” and lose the points obtained in continuous assessment.



The weight of each of the preceding items in the final course grade will be announced at the beginning of the teaching season.



2. Evaluation by final examination. The students who prefer evaluation by final exam to evaluation by continuous assessment can take one final comprehensive exam with theoretical/practical questions that counts 100% of the course grade. This final exam may be different from that for the students who opt for the continuous assessment system. This exam will be held on the date and place set by the Office of the Dean.



Should a student get a different mark in evaluation by continuous assessment and evaluation by final exam, her/his final grade of the course will be the highest of the two.



All the exams will be done in-person on the dates and places set by the Office of the Dean. If, because of exceptional circumstances, changes had to be implemented, they will be communicated in due course.

Basic bibliography

[1] Mankiw, N. G., "Macroeconomics". 11th Edition, 2022. Worth Publishers, New York, USA.

[2] Other material that will be posted on eGELA, the e-learning platform at the UPV/EHU.

In-depth bibliography

[1] Macroeconomics, by Olivier Blanchard, Pearson,2021. 8th edition.
[2] Macroeconomics, by Rudiger Dornbusch, McGraw-Hill, Boston, 2008.
[3] Macroeconomics : principles, problems and policies, by Campbell R. McConnell, McGraw-Hill Higher Education, Boston, 2008.
[4] Macroeconomics, by Stephen D. Williamson, Pearson Addison Wesley, Boston, 2008.
[5] Macroeconomics, by J. Bradford DeLong, McGraw-Hill, Boston, 2002.
[6] Macroeconomics, by David Colander, McGraw-Hill/Irwin, Boston, 2001.
[7] Macroeconomics, by Robert J. Gordon, Addison-Wesley, Reading, Massachusetts, 2000.
[8] Macroeconomics, by Andrew B. Abel, Addison-Wesley, Boston, 2001.
[9] Macroeconomics, by Robert J. Barro, MIT Press, Cambridge, 1997.
[10] Macroeconomics: a European text, by Michael Burda, Oxford University Press, Oxford, 1997.
[11] Macroeconomics, by Robert E. Hall, W. W. Norton, New York, 1997.