ECON 102 and 104- Intermediate MacroeconomicsProfessor Mark HuggettOffice: 576 ICCPhone: (202) 687 - 6683Office Hours: Tuesday 9-10email: [email protected]: http://www.georgetown.edu/faculty/mh5/Course Description: This is an intermediate-level course in macroeconomics.Topics include (i) the measurement of output and prices, (ii) determinants ofeconomic growth, (iii) business-cycle fluctuations, (iv) fiscal policy and (v) mon-etary economics. Observations from the US economy and from a number of othereconomies will be used throughout the course.Grading:Homework 20%MidtermExam30%Final Exam 50%Exam Policy: There is no make-up exam for the midterm exam. You arenot required to take it. If for whatever reason a student fails to take theexam at the scheduled time, then all the weight of the exam will be puton the final exam. If you take the midterm exam, then the score counts.Exam Date: Midterm is Monday March 3 - absent a change of plans.Homework: All homeworks will be put up on my website. Due dates willbe indicated via email and in class. Late homeworks will not be accepted.Homeworks may be done in teams of up to two people total. Names of allteam members must be written on each homework. Electronic submissionof homework (to me) is not acceptable. You can turn in the homeworkearly (not late!) in my mailbox in the economics department on the 5thfloor of the ICC building.Materials: All materials are on the website. These are in two parts.Part 1 is a book which is in an early stage. It is titled “Macroeconomics:A Growth Theory Perspective”. In what follows, BOOK- CH. X will meanchapter X from this book.Part 2 contains some readings. A link to each reading is provided on thewebsite. The course outline indicates which readings go with each of thesix major topics covered in this course.1OUTLINE:1 Measurement of Output and PricesMaterial: BOOK-CH.2 and Readings 12EconomicGrowth2.1 Neoclassical Production Function (Material: BOOK-CH 3)2.2 Solow Growth Model (Material: BOOK-CH 3)2.3 Golden Rule (Material: BOOK-CH 3)2.4 Growth Accounting (Material: BOOK-CH 3)2.5 Two Articles on Productivity (Material: Readings 2)3 Elements of the Life-Cycle Model3.1 Dynamic Consumer Theory (Material: BOOK-CH 4)3.2 The Life-Cycle Model (Material: BOOK-CH 5)4 Business-Cycle Fluctuations (Material: BOOK-CH 6 and Readings 4)4.1 Business-Cycle Facts4.2 Business-Cycle Theory4.3 Keynesian Economics4.4 Gains to Eliminating Business Cycles5 Fiscal Policy (Material: BOOK-CH 7 and Readings 5)5.1 Debt and Deficits5.2 Ricardian Approach to Budget Deficits5.3 An Analysis of Funded and Unfunded Social Security Systems6 Money (Material: Readings 6)6.1 Objects Serving as Money6.2 Relationship Between Money, the Price Level and Interest Rates6.3 Monetary Policy6.4 Nominal Exchange Rates2READINGS:1. Measurement of Output and Prices– Food for Thought– Bias in the Consumer Price Index– Changes in the Wealth of Nations– The Worldwide Standard of Living Since 18002. Economic Growth– The Myth of Asia’s Miracle– Competitive Pressure and Labor Productivity3. Life-Cycle Model: No Readings!4. Business Cycles– Business Cycles: Real Facts and a Monetary Myth– Great Moderation5. Fiscal Policy– The Ricardian Approach to Budget Deficits– Generational Accounting– Progressive Taxation6. Money– The Economic Organization of a POW Camp– Some Monetary Facts– Money and Interest Rates– Inflation Targeting– Markets in Foreign Exchange are Different From Other