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May 22, 2015 / integralds

Summer Macro Course: Math Review

I hesitate to call it “math camp” because I’m not pretending to teach you much mathematics. Instead I’m assuming you already know what a Lagrange multiplier is and am throwing some simple, but common, problems at you. Every single problem in this problem set appears somewhere in macroeconomics.

The problem set is here.

December 16, 2014 / integralds

A Macroeconomics Reading List for Undergraduates

My main reading list is intended for graduate students and researchers in economics and macroeconomics. Most of its articles are beyond the reach of all but the most well-prepared undergraduate students. Hence to meet the demand for a reading list at the undergraduate level, I am introducing the following extended syllabus:

The basic macro reading list

This reading list is different from the main one in the following respects:

  • It is much shorter at six pages rather than 30
  • It is composed primarily of nontechnical or semi-technical articles of general interest
  • It takes a broad stance on what “macroeconomics” is, devoting one-sixth of its length to international development history and another sixth to the microeconomic role of government
  • It is roughly evenly split between normative and positive macroeconomics.
  • Especially where poverty is concerned, the readings branch out from strictly “economics.” For example, books by journalist David Simon and sociologist Richard Florida make an appearance.
  • I place an unusual emphasis on measurement; yes, at some point in your life you should roll up your sleeves and work through BEA’s GDP calculations and BLS’ CPI calculations.
  • The prerequisite is one semester of college-level macroeconomics, though some of the readings will make more sense after having taken an intermediate macro course, a course in public finance, or a course in monetary economics.

I hope some find it useful.

November 19, 2014 / integralds

Central Banks and Macro Models

Over the past decade or so, all major central banks have developed quantitative, modern macroeconomic models for policy analysis. Central banks use a variety of models, of course, but this post will focus on central banks’ internal “dynamic stochastic general equilibrium” models — think of them as larger, more careful versions of the IS-LM or AD-AS model you learned in Intermediate Macro.

Dynamic stochastic general equilibrium (DSGE) models are fully-articulated artificial economies, populated by consumers, firms, a fiscal authority, and a central bank. Some of these models include a significant role for the banking, energy, or materials sectors; some include openness to international trade, while others analyze¬† a “closed” economy where international trade is neglected.¬† A typical medium-scale DSGE model might contain twenty to fifty equations. Some central banks then augment these DSGE models with a “periphery” of additional equations which capture elements that are outside the strict confines of the DSGE “core.” These models can be solved and used for forecasting exercises or policy analysis.

A short list of central bank models:

The main point, for now, is to simply have a one-stop list of central bank models. I may go into their similarities and differences or discuss general modelling strategy at a later date. For even more macro models, the suite of codes in the Macro Model Data Base might be of interest.

October 14, 2014 / integralds

Notes on Clarida, Gali, and Gertler (1999 JEL)

These notes assume knowledge of the IS-LM model typically taught in intermediate macroeconomics. I describe the three-equation New Keynesian model and discuss monetary policy design. The notes are best read side-by-side with the CGG paper; indeed my section numbers and headings follow theirs for ease of comparison.

See here.

August 22, 2014 / integralds

Notes on Yellen’s Jackson Hole Speech (2014)

See here.

August 14, 2014 / integralds

Notes on Measuring Labor Wedges

See here.

July 19, 2014 / integralds

Notes on Krugman (1998 BPEA)

See here.

December 5, 2012 / integralds

Hello world

This may or may not be a blog about monetary economics.