SPP/Economics 556
Winter 1998
MACROECONOMICS

Instructors: Ned Gramlich (Virtual)
Alan Deardorff (Actual)
The course begins with the determinants of a country's living standards in the long run and how a country can influence those by its saving-investment policies. It explains how business cycles arise and how they can or cannot be stabilized by policy actions, including monetary and fiscal policies. The course also analyzes inflation, unemployment, interest rates, the balance of trade, exchange rates, and other widely-watched indicators of economic performance.

Lectures for the course will be available (only) on a CD-ROM that has been prepared by Ned Gramlich. Students will be expected to work through the CD-ROM on their own time and at their own pace, but keeping up with a schedule that will allow us also to discuss the material in class. Class will meet twice a week, once with Alan Deardorff and once with a GSI. In the class with Deardorff we will look together at portions of the CD-ROM and discuss and amplify the material. The class with the GSI will be optional and will constitute a portion of the GSI1s office hours.

Requirements for the course will probably include regular homework assignments, a midterm exam, and (perhaps) a final exam. In addition students will break into small groups and work together throughout the term analyzing the macroeconomic problems and performance of a particular country that they select. They will examine and analyze the growth, inflation, unemployment, budget deficits, trade deficits and so forth of their chosen country and write a short paper summarizing this material. In the last two weeks of class, each team will make a short presentation to the entire class reporting on their country, and they will handle questions from their audience.

There are two books for the course. The main text is Macroeconomics Third Edition, by Greg Mankiw, Worth Publishing Co., 1997. A supplementary text is Memos to the President, by Charles Schultze, Brookings, 1992. We will also make regular use of economic news from the Wall Street Journal and the New York Times, at least one of which you should plan to read regularly. We will also make use of those sources and others on the World Wide Web.

E-mail to: alandear@umich.edu Return to: Deardorff's Home Page