The main objective is to present the basic foundations of macroeconomic theory, starting with the basic macroeconomic model in the long run where prices are flexible. Next, we will study the long run using the Solow model and we will study the effects of fiscal and monetary policies. Next, we turn to study the short run, when prices are rigid. We will analyze the evidence about fluctuations in GDP and its components and the effects of fiscal and monetary policies.
PART 1: Classical Theory
1. National income, the relationship between factor marginal productivity and prices. Factorial distribution of GDP. the relationship between public and private savings and investment in the long run.
2. Money and inflation. The quantitative theory of money. The Fisher equation.
PART 2: Growth: Solow model. Population and technological growth.
PART 3: Unemployment
PART 4: Business cycles.
1. The IS-LM model for the closed economy.
2. The model AS-AD
3. The Mundell-Fleming model for the open economy.
PART 5: Economic policy debates