Syllabus: syllabus_Macroeconomics II
Main Textbook(s):
 Mankiw, G. N. (2010). Macroeconomics (7th Edition). Worth Publisher.
 Mankiw, G. N. (2003). Macroeconomics (5th Edition). Worth Publishers.
Supplementary Textbooks and Readings:
 Ball, L. and Mankiw, G. N. (2011). A New Approach to Intermediate Macroeconomics. Worth Publishers.
Course Topics
 Microeconomic foundations
 Consumption – Keynesian consumption function; Fisher’s model; Lifecycle hypothesis; Permanentincome hypothesis; Random walk
 Investment – Business fixed investment; Residential investment; Inventory investment

 Chapters 16 and 17 from Mankiw (2003); 17 and 18 from Mankiw (2010)

 The Aggregate Demand and Aggregate Supply Model (ADAS Model)
 Labour market; The Sticky Wage and Price Models; The Imperfect Information Model

 Chapters 6 and 13 from Mankiw (2003) and lectures; 6 and 13 from Mankiw (2010)

 The Open Economy version of ADAS Model

 Chapters 5 and 12 from Mankiw (2003) and lectures; 5 and 12 from Mankiw (2010)

 Labour market; The Sticky Wage and Price Models; The Imperfect Information Model
 Policy Discussion
 Stabilization Policy and Government Debt

 Chapters 14 and 15 from Mankiw (2003) and lectures; 15 and 16 from Mankiw (2010)

 Stabilization Policy and Government Debt
 Dynamic Aggregate Demand and Aggregate Supply Model
 Chapter 14 from Mankiw (2010)
Course Information
 The classes start on 06.02.2016 and end on 31.05.2016
 Lectures: Thursday and Friday, 8:30 – 10:00 (room #25 in building 696)
 Exercise Sessions: Wednesday, 9:00 – 10:00 (room #25 in building 696)
 Office hours: By appointment and on default on Wednesday, 2:00pm – 3:00pm
 Grading: See the syllabus
 Tentative dates of 2 midterm examinations: 30.03.2016 and 18.05.2016
 Indicate whether you want to proceed with the continuous evaluation option in the Virtual Campus by 25.03.2017
 How to study this course and prepare for the exam? I am here to offer help and guidance but you have to do the job! I have prepared noncompulsory practical exercises and listed them by topic in Problem Sets section below. Some of these exercises will show up in inclass practical exercises and you’ll earn points from them. Others will help you gain more knowledge about the subject. I strongly recommend solving these exercises on your own.
 I have uploaded course participation exercises in the Virtual Campus. These assignments require reading and summarizing articles. I strongly recommend to start working with them at least two weeks before the deadline. The deadlines are
 Assignment – Consumption and Investment Theories: 8am on 07.03.2017
 Assignment – The Aggregate Demand and Aggregate Supply Model: 8am on 29.03.2017
 Assignment – The Open Economy version of ADAS Model: 8am on 15.05.2017
 Assignment – Policy Discussion: 8am on 25.05.2017
 Assignment – Dynamic Aggregate Demand and Aggregate Supply Model: 8am on 31.05.2017
 I have posted online my slides and handouts for all lectures
 11.02.2017
 During the last week we have covered most of the theories for consumption. I strongly recommend to read the corresponding chapter from the textbook and start looking for articles about these theories. I also strongly recommend to start solving the noncompulsory exercises which are available below.
 Who are the most influential economists of the recent past? To name a few: John Maynard Keynes, Irving Fisher, Franco Modigliani, and Milton Friedman. You have seen some of their contributions during our class about consumption theories. I recommend reading about them and about their contributions to economics.
 Next week we will finish discussing consumption theories and proceed to the discussion of investments. Most probably there will be an inclass practical exercise next week.
 20.02.2017
 We have finished covering theories for consumption and have almost finished covering types of and theories for investments. I strongly recommend to read the corresponding chapters from our main textbook.
 Who are the most influential economists of the recent past? To name a few more: James Tobin, Paul Samuelson, and Simon Kuznets. You have seen some of their contributions during our classes about consumption and investment theories. I recommend reading about them and about their contributions to economics.
 23.02.2017
 We have finished covering the theories for investments and have proceeded to covering unemployment. I strongly recommend to read the corresponding chapters from our main textbook. I also strongly recommend to solve optional problems available on this webpage.
 We are almost done with discussing unemployment. I strongly recommend to read the corresponding chapter from our main textbook.
 Read about wage and price rigidity in this wiki article if you have time to read more about such an important topic in Spain as unemployment. Find a comparison of unemployment rates across some EU countries here. According to this same data, unemployment rate is about 50 percent among individuals below 25 years in Spain, which is very large as compared to, for example, Germany, where it is 10 percent. You can see that here. It is around 17 percent among individuals older than 25 in Spain and 5 percent in Germany. You can see that here.
 01.03.2017
 We have finished discussing unemployment today. I strongly recommend to read the corresponding chapter from our main textbook.
 We have covered all materials related to Problem Sets 1, 2, 3, and 4. Did you start solving them? Solving these optional problem sets will help you to be better prepared for practical exercises, midterms and final exams.
 07.03.2017
 We have started discussing Aggregate Supply Theories. I strongly recommend to read the corresponding chapter from our main textbook.
 Most likely, there will be an inclass practical exercise this week related to unemployment and, perhaps, consumption and investments.
 There are no classes on March 17.
 12.03.2017
 We have finished discussing Aggregate Supply Theories and started discussing Open Economy. I strongly recommend to read the corresponding chapters from our main textbook.
 Most likely, we will solve together the last problem of inclass practical exercise on this Wednesday.
 There are no classes on March 17.
 21.03.2017
 Please, remember to make your choice in the Virtual Campus whether you want to take the continuous assessment option or the unique assessment option.
 23.03.2017
 We have finished the Open Economy topic. I strongly recommend to read the corresponding chapter from our textbook.
 Most likely, we will have a inclass practical exercise tomorrow.
 25.03.2017
 The midterm is scheduled to take place on this Thursday. It includes all the topics we have covered in class, except the topic of “The Small Open Economy Version of ADAS Model.”
 The main instructions for this midterm exam are: “The midterm exam is for 90 minutes. You need a pen or pencil. In order to perform the calculations you can use a calculator. No mobile phones are allowed! Please put everything else that you have aside around classroom walls. You should not have other papers or devices on your table.
The multiple choice questions can have several correct answers as well as several wrong answers. In order to earn points from an exercise, you have to circle all correct answers and no wrong answer. Your calculations should be done with a precision of at least fourth decimal point. Wrong answers earn 2 points.”  02.04.2017
 We have finished covering the small open economy version of the ISLM model. I strongly recommend to read the corresponding chapter from our textbook.
 Watch these Youtube videos about Rational Choice theory, Philips curve, comparative advantage, and impossible trinity
 You can come and check your exam results at 1pm on next Friday, April 7.
 13.04.2017
 We have finished covering The Large Open Economy and The Large Open Economy Version of ADAS Model topics. I strongly recommend to read the corresponding chapter from our textbook.
 There are no classes on April 21.
 25.04.2017
 We have finished discussing the topic about policies. I strongly recommend to read the corresponding chapter from our textbook.
 There is going to be an inclass practical exercise this week. Most probably it will take place on Friday.
 04.05.2017
 Read about government debt and growth of the economy here. Read about a 28 years old student who changed policy making and academia very recently here.
 06.05.2017
 We have finished covering the topic about government debt. I strongly recommend to read the corresponding chapter from our textbook.
 There will be an inclass practical exercise next week.
 There are no classes on May 25 and 31.
 o7.05.2017
 You can read about the demographic outlook of Spain here. Search for the dependency ratio.
 Watch these videos for The Economist’s view on trade, hyperinflation, and taxation.
 15.05.2017
 We have started covering the Dynamic ADAS Model.
 The 2nd midterm examination is not cumulative and will cover all topics which were not covered in the 1st midterm examination. The Dynamic ADAS Model will not be included in the 2nd midterm examination.
 These are exam instructions:
 “The endterm exam is for 90 minutes. You need a pen or pencil. In order to perform the calculations you can use a calculator. No mobile phones are allowed! Please put everything else
that you have aside around classroom walls. You should not have other papers or devices on your table. You must write the number of your student card and your full name below. The
failure to comply with these rules can result in your expulsion from the exam! //In case you have a question rise your hand and I (we) will come to you. In case you spot a mistake, please let me (us) know. The number of points that you can earn from the exercise are in parenthesis.// The multiple choice questions can have several correct answers as well as several wrong answers. In order to earn points from an exercise you have to circle all correct answers and no wrong answer. Wrong answers earn 2 points. Your calculations should be done with a precision of at least second decimal point.”
 “The endterm exam is for 90 minutes. You need a pen or pencil. In order to perform the calculations you can use a calculator. No mobile phones are allowed! Please put everything else
 20.05.2017
 You can come and check your midterm 2 results on May 24 at 3pm.
 There are no classes on May 25.
 25.05.2017
 There is going to be an in class practical exercise on May 26.
 29.05.2017
 There are no classes on May 31.
 19.06.2017
 The final exam takes place in room 8A in building 690.
Slides/Handouts
 Lecture 1 – Consumption Theories (handouts)
 Lecture 2 – Investments (handouts)
 Lecture 3 – Unemployment (handouts)
 Lecture 4 – Theories for Aggregate Supply Curve (handouts)
 Lecture 5 – The Open Economy (handouts)
 Lecture 6 – The Small Open Economy Version of ADAS Model (handouts)
 Lecture 7 – The Large Open Economy (handouts)
 Lecture 8 – The Large Open Economy Version of ADAS Model (handouts)
 Lecture 9 – Policy Discussion (handouts)
 Lecture 10 – Government Debt (handouts)
 Lecture 11 – The Dynamic ADAS Model (handouts)
Problem Sets
 Macro I; Consumption and Investment Theories
 Labor Markets
 Small Open Economy ASAD Model
 Large Open Economy ASAD Model