GRADUATE SCHOOL OF SOCIAL SCIENCES

Ph.D. In Economics

 

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ECON 603 | Course Introduction and Application Information

Course Name
Macroeconomic Theory I
Code
Semester
Theory
(hour/week)
Application/Lab
(hour/week)
Local Credits
ECTS
ECON 603
Fall
3
0
3
10

Prerequisites
None
Course Language
English
Course Type
Required
Course Level
Third Cycle
Course Coordinator
Course Lecturer(s)
Assistant(s) -
Course Objectives This course is designed to develop the theoretical building blocks and tools of dynamic macroeconomics at advanced level. The course methodologically acknowledges the microeconomic foundations of macroeconomics, which is the basis for NeoClassical/ New Classical macroeconomics. Starting from oneperiod and twoperiod general equilibrium models, the course covers several modeling approaches ranging from overlapping generations to infinite period deterministic dynamic general equilibrium modeling. In addition to this, all our modeling examples present both competitive equilibrium and social planner’s solution. Hence, the course builds up a complete sense of macroeconomic modeling.
Learning Outcomes The students who succeeded in this course;
  • To learn macroeconomic modeling through using advanced macroeconomic theories and concepts.
  • To make policy analysis through macroeconomic modeling in a theoretical context.
  • To use macroeconomics knowledge at advanced level and to comment on actual (practical) macroeconomic issues by using this advanced framework.
  • To analyze new and complex ideas in macroeconomics critically.
  • To compare and contrast results of different macroeconomic frameworks.
Course Content The course begins by introducing to students the oneperiod general equilibrium models. Next, twoperiod partial and general equilibrium macroeconomic modeling is developed. Third, overlapping generations models are covered in general equilibrium setup. Finally, deterministic dynamic general equilibrium modeling is studied through reviewing economic growth literature. In that scope, difference equations, differential equations and optimal control theory are covered in the course at sufficient detail.

 



Course Category

Core Courses
Major Area Courses
X
Supportive Courses
Media and Management Skills Courses
Transferable Skill Courses

 

WEEKLY SUBJECTS AND RELATED PREPARATION STUDIES

Week Subjects Related Preparation
1 One period General equilibrium Chapter 1 in HY and other sources
2 One period General equilibrium Chapter 1 in HY and other sources
3 One period General equilibrium Chapter 1 in HY and other sources
4 Neo-classical growth theory Chapter 1 in BSM and other sources
5 Neo-classical growth theory Chapter 1 in BSM and other sources
6 Neo-classical growth theory Chapter 2 in BSM and other sources
7 Neo-classical growth theory Chapter 2 in BSM and other sources
8 Neo-classical growth theory Chapter 2 in BSM and other sources
9 Midterm
10 One-Sector Models of Endogenous Growth Chapter 4 in BSM and other sources
11 Two-Sector Models of Endogenous Growth Chapter 5 in BSM and other sources
12 Models with an Expanding Variety of Products Chapter 6 in BSM and other sources
13 Models with an Expanding Variety of Products Chapter 6 in BSM and other sources
14 Schumpeterian Models of Quality Ladders Chapter 7 in BSM and other sources
15 Review
16 Review of the Semester  

 

Course Textbooks Barro, R.J. and X. Sala-i-Martin (BSM) (2012) Economic Growth, (Second Edition) Michael Wickens (2012) Macroeconomic Theory: A Dynamic General Equilibrium Approach (Second Edition) David Romer (DR), Advanced Macroeconomics McGraw-Hill Irwin, Third Edition 2006 Fabio-Cesare Bagliano and Giuseppe Bertola (FG), Models for Dynamic Macroeconomics Oxford University Press, First Edition 2007 Peter Birch Sorensen and Hans Jorgen Whitta-Jacobsen (SW), Introducing Advanced Macroeconomics: Growth and Business Cycles Mc Graw Hill Education, 2005 Hakan Yetkiner (HY1), Advanced Macroeconomics, unpublished manuscript.
References Attanasio, O. P. (1999) “Consumption,” Chapter 11 in J. Taylor and M. Woodford, (eds.) Handbook of Macroeconomics, Elsevier, Amsterdam. Ando, A. and F. Modigliani, (1963) "The Life-Cycle Hypothesis of Savings: Aggregate Implications and Tests," American Economic Review, Friedman, M., (1963) A Theory of the Consumption Function, Chapters 1-3, Princeton University Press. Hall, R.E., (1978) "Stochastic Implications of the Life Cycle-Permanent Income Hypothesis: Theory and Evidence," Journal of Political Economy, 1978. Carroll, Christopher D, Kimball, Miles S, (1996). "On the Concavity of the Consumption Function," Econometrica, Econometric Society, vol. 64(4), pages 981-92. Campbell, J.Y. and A. Deaton, (1987) "Why is Consumption so Smooth?" Review of Economic Studies. Campbell, J.Y. and N.G. Mankiw, (1989) "Consumption, Income, and Interest Rates: Reinterpreting the Time Series Evidence," NBER Macroeconomics Annual. Caballero, R.J., “Aggregate Investment,” Chapter 12 in Taylor and Woodford, (eds.) Handbook of Macroeconomics, Elsevier, Amsterdam. Jorgenson, D.W., (1963) "Capital Theory and Investment Behavior," American Economic Review. Lucas, R.E., (1967) "Adjustment Costs and the Theory of Supply," Journal of Political Economy. Gould, J.P., (1968) "Adjustment Costs in the Theory of Investment of the Firm," Review of Economic Studies.

 

EVALUATION SYSTEM

Semester Requirements Number Percentage
Participation
Laboratory / Application
Field Work
Quizzes / Studio Critiques
Homework / Assignments
Presentation / Jury
Project
Seminar / Workshop
Midterms / Oral Exams
1
50
Final / Oral Exam
1
50
Total

Contribution of Semester Work to Final Grade
50
Contribution of Final Work to Final Grade
50
Total

ECTS / WORKLOAD TABLE

Activities Number Duration (Hours) Workload
Course Hours
Including exam week: 16 x total hours
16
3
48
Laboratory / Application Hours
Including exam week: 16 x total hours
Study Hours Out of Class
16
6
Field Work
Quizzes / Studio Critiques
Homework / Assignments
Presentation / Jury
Project
Seminar / Workshop
Midterms / Oral Exams
1
40
Final / Oral Exam
1
40
    Total
224

 

COURSE LEARNING OUTCOMES AND PROGRAM QUALIFICATIONS RELATIONSHIP

#
Program Qualifications / Outcomes
* Level of Contribution
1
2
3
4
5
1

Develop and deepen current and advanced level knowledge in economics to an expert level building on the competencies of the masters education and acquire the skills make original contributions to science.

X
2

To comprehend the interaction between economics and related fields; to achieve original results by using expert knowledge in analysis,
synthesis and evaluation of new and complex ideas.

 

X
3

To be able to obtain new knowledge in economics systematically and to acquire high level skills in research methods in economics.

 

X
4

To be able to develop new methods that make a contribution to science or to be able to apply existing techniques to an original
research idea.

 

5

To be able to critically analyze, synthesize and evaluate new and complex ideas.

 

X
6

To develop new ideas and methods by using high level mental processes like creative and critical thinking, problem solving,
decision making.

 

7

To broaden the knowledge of economics by publishing scientific articles related to economics in national or international refereed
journals.

 

X
8

To be able to identify, participate in, organize and lead activities, such as panels, workshops and conferences, that aim to
develop solutions for novel and interdisciplinary problems.

 

9

To follow pioneering and innovative theories and methods in economics, to be able to use them in analysis and research and to be
able to contribute to the process of becoming an information society.

 

10

To be able to analyze the relationships and processes in economics and to develop functional and effective communication networks.

 

11

To be able to find creative solutions for social, scientific and ethical problems in the context of the science and profession of
economics and to be able to spread the values which support these solutions.

 

X
12

To be able share his/her work and to criticize works of others by using academic networks in economics efficiently.

 

X
13

To have a good command of the English language which is mainly
used in Economics and to be able to publish, communicate and follow
the literature in this language.

 

X

*1 Lowest, 2 Low, 3 Average, 4 High, 5 Highest