Macroeconomics I, Macroeconomics II and Macroeconomics III

Study the link between monetary policy decisions and fiscal policy decisions. Understand inflationary dynamics in emerging and developed economies as a result of fiscal imbalances. Introduce the basic concepts of the Fiscal Theory of the Price Level Be able to develop dynamic stochastic general equilibrium models in line with these theories.

Review of decision making over time and uncertainty: dynastic and OG models. Overview of models with money demand: OG, CIA, MIUF, Shopping Cost, Bewley. Monetary policy in the cashless economy, the NK model. Introduction to fiscal/monetary interactions: Leeper (1991) economy in a simple framework. Solving the indeterminacy, the role of fiscal policy. Topics of models for monetary analysis: indeterminacy and equilibrium multiplicity. Applications of fiscal monetary interactions: Sargent and Wallace, Leeper, Cochrane, FTPL, Escape dynamics. Additional topics: Equilibrium multiplicity in monetary models with debt, the role of the inflation target. Calvo (1983), Uribe (2006). Unconventional policies.