Macroeconomic Policy

Code:

2ECON01

Acronym:

PMACR

Keywords
Classification	Keyword
CNAEF	Economics

Instance: 2012/2013 - 1S

Active?	Yes
Responsible unit:	Agrupamento Científico de Economia
Course/CS Responsible:	Master in Economics

Cycles of Study/Courses

Acronym	No. of Students	Study Plan	Curricular Years	Credits UCN	Credits ECTS	Contact hours	Total Time
ME	65	Bologna Syllabus	1	-	7,5	56	202,5

Teaching language

Portuguese

Objectives

Macroeconomic policy is the understanding of current public debates on monetary and budgetary policies as well as on some structural policies. The main objective of the Macroeconomic Policy course is to discuss the main issues involved in the design and implementation of macroeconomic policy, in the framework of a unifying model that is able to encompass different perspectives. Particular attention is devoted to the case of Europe.

Program

1. Introduction
1.1 Positive and normative analysis
1.2 Liberalism vs interventionism
1.3 Objectives, institutions and macroeconomic policy instruments

2. Fiscal policy
2.1 Automatic stabilizers and discretionary fiscal policy
2.2 Deficits and debt dynamics
2.3 Fiscal policy rules
2.4 The European case: the Stability and Growth Pact of the European Union

3. Monetary policy
3.1 Inflation as a monetary policy objective
3.2 The time inconsistency of monetary policy
3.3 Central bank independence
3.4 Monetary policy rules
3.5 The European case: the role of the ECB

4. Shocks and policy responses in the open economy and interdependent economies
4.1 Macroeconomic policies in short run and long run
4.2 Policy responses to shocks
4.3 International coordination of policies
4.4 A small open economy and a monetary union: Portugal and Euro Area
4.5 Macroeconomic policies in exceptional times: the current financial and economic crisis

5. Supply-side policies and macro-prudential policies
5.1 Supply-side shocks and structural policies: labor market and goods market
5.2 Macro-prudential policies
5.3 The portuguese case: Memorandum of Understanding

6. Political economy:
6.1 Fiscal and monetary policy conflicts
6.2 Political cycles

Mandatory literature

Burda, Michael e Wyplosz, Charles; Macroeconomics - a European Text, 5ª ed., Oxford University Press, 2009
Carlin, Wendy e Soskice, David ; Macroeconomics: Imperfections, Institutions and Policies, Oxford University Press, 2006
ECB; The Monetary Policy of the ECB, 2011
Gordon, Robert; Macroeconomics, 11ª ed., Pearson-Addison Wesley, 2009
Loureiro, João; Política Orçamental na Área Euro, Vida Económica, 2008
Artigos a recomendar no decorrer das aulas

Teaching methods and learning activities

The classes mix theory and practice, with the presentation of concepts, theories and models being followed by examples of their application to real macroeconomic policy cases. The classes will be interactive, with a strong participation of students in the discussion of the proposed applications.

Evaluation Type

Distributed evaluation without final exam

Assessment Components

Description	Type	Time (hours)	Weight (%)	End date
Attendance (estimated)	Participação presencial	0,00
	Total:	-	0,00

Calculation formula of final grade

Distribution assessment:
Two tests and one essay.
1st test - 40% + 2nd test - 30% + essay - 30%.

OR

Final Exam:
Exam - 70% + essay - 30% (optional) or exam - 100%.