Macroeconomics

Recommended Prerequisites

Principles of Macroeconomics, Principles of Microeconomics.

Teaching Methods

Lectures: presentation of fundamental contents and case studies of the recent or contemporary national and international reality.

Practical classes:

- Exercise solving.

- Analysis of relevant statistical information

- Encouraging learning by doing: students solve practical exercises as independently as possible.

Learning Outcomes

1. Analyse the impact of the international dimension of macroeconomics, including international trade, foreign exchange rates, and global financial markets.

2. Apply microeconomic concepts to explain how individual decisions aggregate into macroeconomic phenomena, in particular consumption, investment and labour market decisions, and support macroeconomic analysis.

3. Explain the role of public finances in the national economy, including government revenue, expenditure, budget deficits, and debt sustainability.

4. Assess the relationship between inflation, unemployment and aggregate supply through the Phillips Curve. [LO 1 to 4 contribute to LO 1 of the programme]

5. Solve basic open economy macroeconomic models, e.g. the Mundell-Fleming model, consumption and investment optimization problems, using mathematical tools such as calculus also using data on the international dimension of macroeconomics, in particular balance of payments  and on public finances data [contributes to LO 3 o].

Work Placement(s)

No

Syllabus

1. Open Economy in Practice: Facts and Concepts

 1.1. Balance of Payments.

 1.2. Foreign Exchange Market and Its Relationship with the Balance of Payments

2. The Mundell-Fleming Model

 2.1. The BP=0 line and External Equilibrium

 2.2. General Equilibrium: Policies, Shocks, and Adjustment Mechanisms

3. Microeconomic Foundations

 3.1. Consumption

 3.2. Investment

4. Labour Market

 4.1. Basic Concepts

 4.2. Integrated Labour Market Model

5. Empirically Supported Long-Run Theories

 5.1. Intertemporal aggregate constraint

 5.2. Fisher effect

 5.3. Purchase Power parity

6. AD-AS Model

 6.1. Static and Dynamic Representations, and Key Elements

 6.2. Policies, shocks, adjustments and equilibrium

7. Economic Policies: Characterisation and Institutional Framework

 7.1. Fiscal Policy

 7.2. Monetary Policy

 7.3. Exchange Rate Policy.

Head Lecturer(s)

Tiago Miguel Guterres Neves Sequeira

Assessment Methods

Assessment
Periodic or by final exam as given in the course information: 100.0%

Bibliography

Abel, A. , Bernanke, B., Croushore D. (2020). Macroeconomics. 10^th ed. Pearson Global Editions.

Blanchard, O., Amighini, A., Giavazzi, F. (2021). Macroeconomics, a European perspective. 4^th ed. Pearson.

Burda, M. & Wyplosz, C. (2022). Macroeconomics: A European Text. 8^th ed. Oxford University Press.

Dornbush, R., Fischer, S. & Startz, R. (2018), Macroeconomics 13^th ed. McGraw-Hill.

Mankiw, G. (2022). Macroeconomics. 11th Ed. McMillan Learning.

Santos, J. Pina, A., Braga, J. Aubyn M. (2016), Macroeconomia. 4ª ed. Escolar Editora

Teixeira, A., Silva, S., Ribeiro, A., Carvalho, V. (2019). Fundamentos Microeconómicos da Macroeconomia-Exercícios Resolvidos e Propostos. Vida Económica.