Jonathan Hazel (SAL.1.10) and Maarten De Ridder (SAL.1.11)

This course is available on the BSc in Econometrics and Mathematical Economics, BSc in Economics, BSc in Economics and Economic History, BSc in Economics with Economic History, BSc in International Social and Public Policy and Economics, BSc in Mathematics and Economics, BSc in Mathematics with Economics, BSc in Philosophy and Economics, BSc in Philosophy, Politics and Economics and BSc in Politics and Economics. This course is available as an outside option to students on other programmes where regulations permit. This course is available with permission to General Course students.

Students should have completed Macroeconomics II (EC2B1) or Macroeconomic Principles (EC210), or Macroeconomics I (EC1B3) combined with either Macroeconomics II (EC2B3) or Macro-Finance (FM201), or equivalent.

Students should also have completed Econometrics I (EC2C3) and Econometrics II (EC2C4) or Introduction to Econometrics (EC220) or Principles of Econometrics (EC221), or otherwise show a capacity to read and understand applied research methods.

Students who have thoroughly mastered mathematics to the level of Quantitative Methods (Mathematics) (MA107) should be able to follow the course but would find it difficult. Mathematical Methods (MA100) would give a better grounding.

The course is split into a few segments where, in each one, an advanced model in macroeconomics is covered, and its empirical implications are drawn out and taken to the data. The topics will be varied, but few, and depth will be privileged over breadth. The goal is to confront some key questions in macroeconomics: Why are some countries richer than others? Why does economic activity fluctuate? Why is inflation high? Why are exchange rates so volatile? The precise questions that will be covered every year will be connected to challenges at the time of the course. The emphasis is on introducing students to advanced tools that they can use broadly to answer macroeconomic questions.

This course is delivered through a combination of classes and lectures totalling a minimum of 25 hours. 15 hours of lectures and 10 hours of classes in the Autumn Term.

Students will submit and receive feedback on two pieces of formative work during the term.

The course is mainly based on lecture notes and journal articles. As an example of the level and content of the reading in economics articles, students may wish to look at the following:

• Hazell, J., J. Herreno, J, E Nakamura, J. Steinsson 2022. “The Slope of the Phillips Curve: Evidence from US States” Quarterly Journal of Economics, 137: 1299-1344.
• De Ridder, M., B. Grassi, G. Morzenti (2022). “The Hitchhiker’s Guide to Markup Estimation” CEPR discussion paper 17532
• Itskhoki, O. and D. Mukhin (2021). “Exchange Rate Disconnect in General Equilibrium” Journal of Political Economy, 2021, 129, 2183-2232

Project (100%, 5000 words) in the WT.