On this semester, we continue our lectures on intermediate Macroeconomics based on the textbook “Macroeconomics” by S. D. Williamson (6th Edition). We continue with the theory of Economic Growth and we discuss the issue of income disparities between countries, daveloping a model of human capital accumulation (Endogenous Growth theory). We then move on to a two-period model of the economy and discuss the consumption-saving decision of economic agents while also including credit markets and adding economic imperfections like asymmetric information. We conclude with a real intertemporal (dynamic) model for investment which basically adds up everything we have learnt so far about consumers and firms’ maximization behavior and allows us to study the effect of shocks (in total factor productivity, govt spending etc.) on GDP, investment, consumption and the real interest rate. If time permits, we will discuss money and monetary policy in our modeling framework as well as Business cycle theory (chapters 12, 13). The students need to have reviewed what we studied in the last semester, especially chapter 4 and 5. Familiarity with basic mathematical economics, like calculus and maximization problems is welcome.
