Central banks and other policy institutions rely on macroeconomic models to assess how policies affect households, firms, and the aggregate economy. In this course, you will learn how these models are built and how they can guide policy-making. How does monetary policy work? What is forward guidance? Why do interest rate changes impact households unequally? And what do lottery winnings have to do with all this?
The course will cover the following topics in macroeconomics:
- Basics of modern macroeconomics: individual optimization
- Planning for the future: dynamic problems
- How do markets clear: general equilibrium
- Consumption and savings
- Real business cycle
- Government spending and fiscal policy
- Inflation and monetary policy