Economics 302 Spring 2009 University of Wisconsin Madison Menzie D Chinn Social Sciences 7418 Intermediate Macroeconomic Theory 1 INTRODUCTION Economics 302 is a course in intermediate macroeconomic theory and policy analysis Students should have a familiarity with algebra solving simultaneous equations Knowledge of basic calculus partial and total differentials and introductory statistics linear regression will be helpful but not required The main part of the course will focus on the IS LM framework However considerable attention will be devoted to international aspects such as the trade deficit international capital flows and the exchange rate as well as domestic issues such as the current financial economic crisis Students enrolling in this course should be comfortable with algebraic and graphical analysis It requires sustained immersion in relevant economic theory and does not present a primarily descriptive or historical approach 2 OFFICE HOURS Professor Menzie Chinn Th 2 30 4 30 subject to revision Social Sciences 7418 Phone 262 7397 e mail mchinn lafollette wisc edu Updated information will be posted on the course website http www ssc wisc edu mchinn web302 f09 html 3 SCHEDULE AND READINGS The textbook is Robert Hall and David Papell Macroeconomics Economic growth fluctuations and policy 6th Edition Norton 2005 available at the University Bookstore Note that older editions of the textbook are not substitutable for the current edition The textbook website also has some additional materials http www wwnorton com college econ hat6 Additional required readings are located under the Required On Line Readings section of the course website Commentary on current economic conditions at http www econbrowser com will also be referred to on occasion Below is a list of reading assignments which is subject to revision LEC DATES TEXT Web TOPICS 1 2 3 5 6 9 10 11 12 13 14 15 16 17 18 19 20 21 22 25 26 27 28 29 1 2 3 7 8 13 NBER Wu CBO ISLM notes PCO notes Introduction Measuring performance Employment Short run fluctuations IS LM Govt spending taxes deficits Midterm I Monetary system Credit channel Economic fluctuations model Consumption Midterm II Investment Foreign trade the exchange rate Micro foundations of price stickiness Macro policy model Taylor Rule Long run economic growth 9 3 9 8 9 10 17 9 22 10 1 10 6 10 8 10 13 15 10 20 10 22 27 10 29 11 3 11 5 11 10 12 11 17 12 1 12 3 12 8 12 10 15 14 9 10 11 12 15 16 4 Credit notes ADAS notes Open notes 12 22 Tuesday 7 45 AM FINAL EXAM Readings NBER BCDC Determination of the December 2007 Peak in Economic Activity December 11 2008 Wu Two Measures of Employment How Different Are They FRBSF Economic Letters 2004 23 August 27 2004 CBO The Budget and Economic Outlook An Update September 2009 Notes on IS LM Notes on Portfolio Crowding Out Notes on the Credit Channel Notes on Aggregate Demand and Aggregate Supply and Supply Shocks Weidner and Williams How Big Is the Output Gap FRBSF Economic Letters 2009 12 June 12 Notes on the Open Economy 4 GRADING Letter grading is determined as follows 20 Problem sets 50 Two midterm exams 25 each 30 Final examination There will be no make up midterm exams Missed midterm exams will increase accordingly the weight assigned to the other midterm and the final exam provided you have either 1 a valid physician s note attesting to the fact that you have a health issue which prevents you from taking the exam or 2 contacted your TA and or the instructor with a reason which is approved prior to missing the exam Other cases are subject to the instructor s discretion The problem sets are an integral part of the course Assignments will be handed into me in lecture on the appropriate date Late assignments will not be accepted for credit Although the problem sets do not constitute a large portion of the grade I strongly encourage you to do the assignments in a timely and serious fashion as they provide valuable information regarding your grasp of the concepts 5 ECONOMICS DEPARTMENT GRIEVANCE PROCEDURE The Department of Economics has developed a grievance procedure through which you may register comments or complaints about a course instructor or a teaching assistant The Department also uses course evaluations If you wish to make anonymous complaints to an instructor or teaching assistant the appropriate vehicle is the course evaluation If you have a disagreement with an instructor or a teaching assistant we strongly encourage you to resolve the dispute with him or her The grievance procedure is for situations where neither the course evaluation nor direct contact is appropriate To file a grievance you should go to Social Science 7238 and request a Course Comment Sheet On it you must provide a detailed statement about what you find unsatisfactory You must also sign the sheet provide your student ID number an address and phone number The Department investigates grievances fully and will respond in writing Your name address phone number and student ID will not be provided to the instructor of teaching assistant and will be treated confidentially The Department uses this information in case the Department Chair or a nominee wishes to meet with the student to gather additional information The written response is mailed to the address provided by the student 9 8 2009 rev 22 8 2009 e302syllabus f09 doc