Econ 6021w Klasing w13

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CARLETON UNIVERSITY

Department of EconomicsECON 6021WEconomic Theory: Macroeconomics

Winter 2013

Instructor: Mariko J. KlasingOffice: A-808 Loeb

Office Hours: W, 2:00-3:00PM

Email: [email protected]

Phone: 520-2600 ext. 3758

Lectures: Tu, 8:35 PM - 11:25 PM

Attention: No class on Feb. 19

COURSE DESCRIPTION:

The purpose of this course is to provide Ph.D. students with modern macroeconomic theory.

Emphasis is laid on rigorous analysis as well as intuitive grasp of standard models. Topics

covered are consumption theory, economic growth, and investment theory.

TEXTBOOKS:

There is no particular required reading, but the following textbooks are useful for this course.

You can find a more detailed list of suggested readings for each of the topics further below.

Daron Acemoglu, Introduction to Modern Economic Growth, Princeton University Press,

2008

Philippe Aghion and Peter Howitt,Endogenous Growth, MIT Press, 1997

Robert J. Barro and Xavier Sala-i-Martin,Economic Growth, MIT Press, 2003

Olivier J. Blanchard and Stanley Fischer,Lectures on Macroeconomics, MIT Press, 1989

David Romer,Advanced Macroeconomics, 4thed., McGraw Hill, 2011


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ORGANIZATION & READINGS (TENTATIVE):

Part I: Consumption Theory

Topics:

- 2-period Fischer model

- Optimal consumption over multiple periods (Life Cycle Model)

- Permanent Income Hypothesis

- Optimal consumption under uncertainty

- Liquidity constraints

- Precautionary savings

Readings:

Blanchard/Fischer, ch. 6

Angus Deaton, Understanding Consumption, Clarendon Press, 1989

Romer, ch. 7

Part II: Economic GrowthTopics:

- Neoclassical growth: Solow-Swan model

- Growth with optimal consumption I: Ramsey-Cass-Koopmans model

- Growth with optimal consumption II: Diamonds OLG model

- Endogenous Growth I: Models with externalities

- Endogenous Growth II: Innovation-based growth models

- Malthus population model

- Unified Growth Theory

Readings:

Acemoglu,Introduction to Modern Economic GrowthAghion/Howitt, Endogenous Growth

Aghion/Howitt: Growth with Quality-Improving Innovations: An Integrated Framework,

in: Aghion/Durlauf (ed.),Handbook of Economic Growth, ch. 2, Elsevier, 2005

Barro/Sala-i-Martin, ch. 1-7

Blanchard/Fischer, ch. 2-3

Cervellati/Sunde, Human-Capital Formation, Life Expectancy, and the Process of

Development,American Economic Review, 95: 1653-1672, 2005

Doepke, Accounting for the Fertility Decline During the Demographic Transition,Journal

of Economic Growth, 9: 347-383, 2004

Galor, From Stagnation to Growth: Unified Growth Theory, in: Aghion/Durlauf (ed.),

Handbook of Economic Growth, ch. 4, Elsevier, 2005

Galor/Moav, Natural Selection and the Origin of Economic Growth, Quarterly Journal of

Economics, 117:1133-1192, 2002

Galor/Weil, Population, Technology and Growth: From Malthusian Stagnation to the

Demographic Transition and Beyond,American Economic Review, 90: 806-828, 2000


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Galor/Weil, The Gender Gap, Fertility and Growth,American Economic Review, 86: 874-

887, 1996

Jones,Introduction to Economic Growth, Ch. 5, Norton, 2001

Jones, Growth and Ideas, in: Aghion/Durlauf (ed.),Handbook of Economic Growth, ch. 16,

Elsevier, 2005

Kremer, Population Growth and Technological Change: One Million B.C. to 1990,

Quarterly Journal of Economics, 108:681-716, 1993

Lucas,Lectures on Economic Growth, Harvard University Press, 2004

Romer, Endogenous Technological Change, Journal of Political Economy, 98: 71-102,

1990

Romer, ch. 1-3

Part III: Investment Theory

Topics:

- The q-theory of investment- External and internal adjustment costs

- The effect of temporary vs. permanent shocks

- Investment under uncertainty

Readings:

Blanchard/Fischer, ch. 6

Romer, ch. 8


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COURSE EVALUATION:

Midterm (written): date: TBA

Final (written): date: April 9

The weight allocation is 40/60, i.e. your better grade will account for 60% of the final grade

and the other one for 40%.

We will decide on the dates for the midterm and final in class. The midterm will cover the

topics discussed in the first half of the course and the final the topics from the second half of

the course.

Assignments: There are no assignments that are marked for credit. However, I will give you

a set of exercise questions (incl. short solutions) for each topic that you should try to solve on

your own and that will help you to prepare for the exams.

Re-marking: Any request for the remarking of exams must be submitted in writing within

two weeks of that exam first being returned to the class. The request should contain a detailed

explanation of why you feel you should receive a higher mark. Please note that remarkingwill apply to the entire exam not just the contentious question. As a result, the revised mark

may be higher than, lower than or the same as the original mark.

Plagiarism: Please be aware that plagiarism is a serious offence at Carleton and should be

recognized and avoided. For further information on how to do so, please see Pammett on

Plagiarism and Paraphrasing at http://www.carleton.ca/economics/courses/writing-

preliminaries/.

ACADEMIC ACCOMMODATIONS:

For Students with Disabilities: Students with disabilities needing academic

accommodations in this course are required to contact a coordinator at the Paul Menton

Centre (ext. 6608) to complete the necessary Letter of Accommodation. After registering

with the PMC, make an appointment to meet and discuss your needs with me in order to

make the necessary arrangements as early in the semester as possible, but no later than two

weeks before the first assignment is due or the first test requiring accommodations is taking

place. Please note that the deadline for submitting completed forms to the Paul Menton

Centre is March 12, 2010.

For Religious Obligations:

To be worked out on individual basis with instructor. Consult the Equity Services website or

an Equity Advisor (ext. 5622) for policies and a list of holy days (www.carleton.ca/equity).

For Pregnancy:

Pregnant students requiring academic accommodations are encouraged to contact an Equity

Advisor in Equity Services (ext 5622) to complete a letter of accommodation. The student

must then make an appointment to discuss her needs with the instructor at least two weeks

prior to the first academic event in which it is anticipated that the accommodation will be

required.

Econ 6021w Klasing w13

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