The students should develop a critical understanding of the main issues and propositions of macroeconomics. They shall understand why the Classical and the Keynesian school differ on the analysis of economic processes and the emergence of crises as well as concerning the resulting recommendations with respect to the optimal design of fiscal and monetary policy. They shall develop a feeling for the advantages and limitations of the application of mathematical macroeconomic models and learn what types of models are appropriate for the study of specific issues.
1) Introduction: The birth of macroeconomics set off by the Great Depression; Classical versus Keynesian Economics - a sketch; evolution of macroeconomic variables in selected countries during the last decades
2) national income accounting
3) multiplier models
4) IS-LM model and the AS-AD model (short-run versus medium-run effects of monetary and fiscal policy and of shocks); Phillips curve and Okun's Law
5) Mundell-Fleming model (monetary and fiscal policy in open economies under fixed and flexible exchange rates).
Lecture notes will be provided step by step; download http://www.econ.tuwien.ac.at/hof/makro-wm-vo.html (username and password will be announced via TISS-News before the first lecture). The lecture is based on selected chapters of
Blanchard, Olivier und Gerhard Illing, Makroökonomie, 6., aktualisierte Auflage, Pearson Studium, 2014 or
Olivier Blanchard, Macroeconomics, 6th edition, Prentice Hall.
