Intermediate macroeconomics
Associate Professor Lachlan McGregor
6 points * Two 1-hour lectures and one 1-hour tutorial per week * First, second semester * Clayton * Prerequisites: ECO1010 or ECO1030 or equivalent, ECO1100 and ECO1110 only with permission of the lecturer
Objectives On completion of this subject students should be able to analyse systematically the forces that determine changes in macroeconomic performance and living standards in Australia; understand the relationship between the domestic economy and the international economic environment, as reflected in the behaviour of the balance of payments and exchange rates; appraise critically the issues underlying important contemporary policy debates in Australia and elsewhere; appreciate the nature and relevance of some significant recent developments in macroeconomics; engage in rigorous economic analysis.
Synopsis Review of basic Keynesian macroeconomics; development of the open-economy, IS-LM framework and the aggregate demand-aggregate supply framework as a basis for more advanced macroeconomic analysis; principles of monetary and fiscal policy and problems of implementation; alternative theories of aggregate supply; new classical macroeconomics and the implications of imperfect information; new Keynesian macroeconomics and the implications of labour market rigidities; explaining and correcting inflation and unemployment; alternative explanations of the business cycle; a perspective on current debates over the budget deficit, the national debt, and the international debt.
Assessment Final examination (2 hours): 80% * Class test: 20%
Prescribed texts
Maxwell P and Hopkins S (eds) Contemporary Australian readings 2nd edn, Harper Educational, 1993