1) Why Are Economic Models Useful?2) The New Keynesian Model and its Empirical Relevance.3) Welfare Based Evaluation of Monetary Policy.4) Macroeconomic Stability and Monetary Policy.5) Rules vs. Discretion.6) Optimal Monetary Policy under Discretion.7) Optimal Monetary Policy under Commitment.8) Monetary and Fiscal Policy.9) Financial Frictions.10) Wrapping It Up.Micro-founded dynamic general equilibrium models have become the standard tool for macroeconomic analysis. This course will provide an introduction on how to work with these models. Our baseline New Keynesian model features sticky prices combined with monopolistic competition. That framework has emerged as a powerful tool for monetary policy analysis. Its adoption as the backbone of medium-scale models currently developed by central banks and policy institutions is a clear reflection of its success. This course provides a nice opportunity to learn about the most recent developments in the field of monetary economics in a way that is appropriate for undergraduate students. Related to this, I should also mention that the textbook mentioned below goes (slightly) beyond the level of this course.
Clarida, Richard, Jordi Galí, and Mark Gertler (1999): "The Science of Monetary Policy: a New Keynesian Perspective", Journal of Economic Literature, 37(4), 1661–1707.Galí, Jordi (2015): Monetary Policy, Inflation and the Business Cycle, Princeton University Press.
StO/PO BA BWL und VWL 2016: 6 LP, Modul: "Monetary Economics"
Written exam (90 min)
