Labor market regularities in the short and long run. The aim of this lecture is to present basic regularities (stylized facts) of the labor market functioning in the long and short run in developed and developing countries. Course hours: 1, students' self-study hours: 1. The Government Budget Constraint The Ricardian Equivalence Result Ricardian Equivalence in Practice Tax-Smoothing Political-Economy Theories of Budget Deficits Strategic Debt Accumulation Delayed Stabilization Empirical Application: Politics and Deficits in Industrialized Countries 12.9 The Costs of Deficits 12.10 A Model of Debt Crises Problems

David Romer's Advanced Macroeconomics, 4e, continues its tradition as the standard text and the starting point for graduate macroeconomic courses and helps lay the groundwork for students to begin doing research in macroeconomics and monetary economics. Formal models are used to present and analyze key ideas and issues. The theoretical analysis is supplemented by examples of relevant empirical work, illustrating the ways that theories can be applied and tested. This well-respected and well-known text is unique in the marketplace. The course will teach you the main empirical business cycle characteristics of developed economies and the main empirical findings regarding the growth of developed and less developed nations. Lucas-Uzawa model. The aim of this lecture is to present a two-sector grwoth model with special attention to the role of human capital. course hours: 2, hours of student’s self study: 4. evaluate the extent to which well-known macroeconomic models can explain real-world data and macroeconomic experiences

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Keeping the book up to date has been made even more challenging by the financial and macroeconomic crisis that began in 2008. I have deliberately chosen not to change the book fundamentally in response to the crisis: although I believe that the crisis will lead to major changes in macroeconomics, I also believe that it is too soon to know what those changes will be. I have therefore taken the approach of bringing in the crisis where it is relevant and of including an epilogue that describes some of the main issues that the crisis raises for macroeconomics. But I believe that it will be years before we have a clear picture of how the crisis is changing the field. For additional reference and general information, please refer to the book’s website at www.mhhe.com/romer4e. Also available on the website, under the password-protected Instructor Edition, is the Solutions Manual. Print versions of the manual are available by request only—if interested, please contact your McGraw-Hill/Irwin representative. This book owes a great deal to many people. The book is an outgrowth of courses I have taught at Princeton University, the Massachusetts Institute of Technology, Stanford University, and especially the University of California, Berkeley. I want to thank the many students in these courses for their feedback, their patience, and their encouragement. Four people have provided detailed, thoughtful, and constructive comments on almost every aspect of the book over multiple editions: Laurence Ball, A. Andrew John, N. Gregory Mankiw, and Christina Romer. Each has significantly improved the book, and I am deeply grateful to them for their efforts. In addition to those four, Susanto Basu, Robert Hall, and Ricardo Reis provided extremely valuable guidance that helped shape the revisions in this edition. Many other people have made valuable comments and suggestions concerning some or all of the book. I would particularly like to thank James Butkiewicz, Robert Chirinko, Matthew Cushing, Charles Engel, Mark Gertler, Robert Gordon, Mary Gregory, Tahereh Alavi Hojjat, A. Stephen Holland, Hiroo Iwanari, Frederick Joutz, Pok-sang Lam, Gregory Linden, Maurice Obtsfeld, Jeffrey Parker, Stephen Perez, Kerk Phillips, Carlos Ramirez, Robert Rasche, Joseph Santos, Peter Skott, Peter Temin, Henry Thompson, Matias Vernengo, and Steven Yamarik. Jeffrey Rohaly prepared the superb Solutions Manual. Salifou Issoufou updated the tables and figures. Tyler Arant, Zachary Breig, Chen Li, and Melina Mattos helped draft solutions to the new problems and assisted with proofreading. Finally, the editorial and production staff at McGraw-Hill did an excellent job of turning the manuscript into a finished product. I thank all these people for their help. Online Appendix B: Narrative Evidence on the Motivation for Fiscal Policy in Crisis Episodes [PDF], May 2019. This is more advanced and it’s a completely different animal because it’s a textbook with more specialized demands and a more specialized audience. The Shapiro–Stiglitz Model Contracting Models Search and Matching Models Implications Empirical Applications Problems

Government sector and fiscal policy. The aim of this lecture is to review the role of government in the economy, public goods, ways of financing public expenditure in finite and infinite time horizon models. course hours: 2, hours of student’s self study: 4. He has 13 or 14 chapters. Each chapter is a fundamental section of macroeconomics, starting with economic growth, going on to endogenous growth and the economics of ideas, economics of information, economics of monetary policy, fiscal policy, employment—you name it. It’s the most comprehensive, and it’s accessible. Godley, W. and Lavoie, M. (2012). Monetary Economics: An Integrated Approach to Credit, Money, Income, Production and Wealth, Basingstoke: Palgrave Macmillan, 2nd edition. implies that the differences in real incomes that we are trying to understand are far too large to be accounted for by differences in capital inputs. The model treats other potential sources of differences in real incomes as either exogenous and thus not explained by the model (in the case of technological progress, for example) or absent altogether (in the case of positive externalities from capital, for example). Thus to address the central questions of growth theory, we must move beyond the Solow model. Chapters 2 through 4 therefore extend and modify the Solow model. Chapter 2 investigates the determinants of saving and investment. The Solow model has no optimization in it; it takes the saving rate as exogenous and constant. Chapter 2 presents two models that make saving endogenous and potentially time-varying. In the first, saving and consumption decisions are made by a fixed set of infinitely lived households; in the second, the decisions are made by overlapping generations of households with finite horizons. Relaxing the Solow model’s assumption of a constant saving rate has three advantages. First, and most important for studying growth, it demonstrates that the Solow model’s conclusions about the central questions of growth theory do not hinge on its assumption of a fixed saving rate. Second, it allows us to consider welfare issues. A model that directly specifies relations among aggregate variables provides no way of judging whether some outcomes are better or worse than others: without individuals in the model, we cannot say whether different outcomes make individuals better or worse off. The infinite-horizon and overlapping-generations models are built up from the behavior of individuals, and can therefore be usShapiro, Stiglitz (1984) 'Equilibrium Unemployment as a Worker Discipline Device', American Economic Review , Vol. 74, pp. 433-444. GALE, D. (1973) “Pure Exchange Equilibrium of Dynamic Economic Models,” Journal of Economic Theory, 6, 12-36. A Baseline Case: Fixed Prices Price Rigidity, Wage Rigidity, and Departures from Perfect Competition in the Goods and Labor Markets Empirical Application: The Cyclical Behavior of the Real Wage Toward a Usable Model with Exogenous Nominal Rigidity