To enable students to acquire the knowledge and competencies necessary to conduct an analysis of economic behavior, investigate the causes of fundamental macroeconomic problems, and evaluate the effects of macroeconomic policy on the behavior and performance of the economy, within the framework of the studied macroeconomic models. The course encourages students to apply a systematic and model approach to analyzing economic phenomena and challenges, and to evaluate macroeconomic policy and performance.
Introduction to Macroeconomics. Macroeconomic environment of everyday life. Economics as a science (economic theory and models; positive vs. normative economics, microeconomics vs. macroeconomics). Organization and behavior of the economy.
Measurement of economic activities. GDP, well-being and happiness. Introduction on macroeconomic policy. Macroeconomic challenges: business cycles, unemployment, inflation, deficit.
Macroeconomic theories and models. AS-AD model. Leading macroeconomic paradigms. Model of the goods and services market in the short (AE model) and long (classical model) run. Money and financial institutions. Bond market model. Model of the money market in the short and long run. IS-LM model. Model of the labor market with flexible and rigid wages. Exogenous supply shocks. Unemployment and inflation: Phillips curves. Effects of macroeconomic policy within the studied models.
Macroeconomics of an open economy: models of a small open economy in the market for goods and services in the short (AE model) and long (classical model) run. Exchange rates and the foreign exchange market model. Real exchange rate, macroeconomic policy and macroeconomic performance. Balance of payments. Internal and external equilibrium. IS-LM model in an open economy. Effects of macroeconomic policy within the framework of the studied models of a small open economy. Economic growth: initial definitions.
