This course is designed to provide students with an understanding of key macroeconomic issues such as economic growth, consumption, investment, and unemployment at an advanced level. It further introduces the tools of dynamic optimization and then applies them to a wide range of recent developments in fiscal and monetary policy.

There are two parts - lectures and practice sessions.The lectures develop basic knowledge about and understanding of important macroeconomic relationships – based on the underlying textbook.The practice sessions, which require mandatory attendance, deepen the knowledge obtained in the lectures by discussing both pencil and paper as well as computer exercises. See the description in Moodle for details.

Topics related to:The Solow Growth ModelInfinite-Horizon ModelsEndogenous GrowthCross-Country Income DifferencesReal-Business-Cycle TheoryNominal RigidityDynamic Stochastic General-Equilibrium Models of Fluctuations

Common Body of Knowledge – CBK 5: Bridging Economics and CBK 3: Bridging Computing

Common Body of Knowledge – CBK 1: Mathematical Methods and CBK 2: Statistical Methods.

Romer, D. (2019) Advanced Macroeconomics, McGraw-Hill, Fifth Edition.

Practice sessions: For the practice sessions you will have to solve the exercises of the corresponding exercise sheet. During the practice sessions you will be asked – chosen randomly – to present your solution for any of the exercises you ticked. You are expected to give a short and succinct presentation of your solutions.A necessary condition for successfully completing the practice sessions is to tick at least 60% of the exercises. If it turns out that you are absent (without excuse) or haven’t prepared the exercise, you may be penalized with up to 5 minus points. In addition, you will lose the point for the exercise you ticked in the list (or all if you are absent). Serious flaws in the solutions presented will lead to deductions. You may, however, also be awarded bonus points for particularly good explanations of exercises and contributions (to the discussions).See description in Moodle for details, especially regarding the practice sessions.There will be a  final exam with a combination of multiple-choice and open questions.

The final exam is based on the actual contents discussed in the lectures and practice sessions.

You must successfully complete (i.e. achieve at least 50% of the attainable points of) each part (practice sessions and final exam), with both parts each contributing 50% to the overall grade; this means that taking the final exam is conditional upon completing the practice sessions successfully.The overall final grade is – in case both parts are completed successfully – the arithmetic mean of the two sub-grades, rounded in your favour.If one of the two parts is not completed successfully EC2:Macroeconomics VC needs to be repeated in its entirety. [This is required by law and not for us to decide.]