Macroeconomics B (MakØkB)

Knowledge of

• The stylized empirical facts about business cycles;
• The rationale for nominal rigidities of prices and wages; 
• The short run macroeconomic fluctuations around the long run trend;
• The most important macroeconomic theories about private consumption and investment;
• The most important macroeconomic theories about monetary policy, aggregate demand, the inflation process, and aggregate supply;
• The equilibrium mechanisms of the theoretical macroeconomic models for closed and open economies covered by the course;
• The dynamic mechanisms that pull the economy towards its long-run growth trend;
• The impulses that initiate business cycles and the economic propagation mechanisms that give business cycles their systematic properties.
   

Skills in

• Reflecting about the most important criticisms of the key assumptions underlying the models presented and how these affect the modelsʼ predictions;
• Selecting and applying dynamic macroeconomic models, deterministic or stochastic, of the types covered by the course;
• Conducting an analysis of a specific macroeconomic stabilization problem within modelling frameworks as known from the course;
• Applying the most important macroeconomic theories for private consumption, private investment and the inflation process;
• Assessing the key mechanisms for the determination of exports and imports in a small open economy and the role of the exchange rate in this;
• Assessing pros and cons of a fixed vs. a floating exchange rate;
• Assessing the effects of macroeconomic stabilization policy. 

Competences in

• Conducting an independent macroeconomic analysis of a relevant problem with outset in theoretical models as known from the course;
• Confronting theoretical macro models with empirical facts and on this background be able to assess the models' applicability in various connections;
• Working systematically and consistently with dynamic macroeconomic models;
• Deducing specific implications and results and assessing and discussing these in specific macroeconomic problems based on relevant theoretical macroeconomic analysis.