#
ESF:MPE_MAMO Macro modelling - Course Information

## MPE_MAMO Macroeconomic modelling

**Faculty of Economics and Administration**

Autumn 2014

**Extent and Intensity**- 2/1/0. 10 credit(s). Type of Completion: zk (examination).
**Teacher(s)**- Ing. Miroslav Hloušek, Ph.D. (lecturer)

prof. Ing. Osvald Vašíček, CSc. (lecturer) **Guaranteed by**- prof. Ing. Osvald Vašíček, CSc.

Department of Economics - Faculty of Economics and Administration

Contact Person: Lydie Pravdová

Supplier department: Department of Economics - Faculty of Economics and Administration **Timetable**- Tue 14:35–16:15 P201
- Timetable of Seminar Groups:

MPE_MAMO/02: each even Thursday 14:35–16:15 VT204,*M. Hloušek* **Course Enrolment Limitations**- The course is also offered to the students of the fields other than those the course is directly associated with.
**Fields of study the course is directly associated with**- Economics (programme ESF, M-EKT)
- Economics (programme ESF, N-EKT)
- Economics (programme ESF, N-MA)
- Mathematical and Statistical Methods in Economics (programme ESF, N-KME)
- Mathematics - Economics (programme PřF, N-AM)

**Course objectives**- At the end of the course students should be able to:

- give overview of national accounts

- understand Solow growth model

- simulate Markov processes (compute the value of being at a given state)

- solve simple neoclassical growth model

- formulate Lagrangian

-- derive optimality conditions of households and firms and to interepret them

-- define competitive equilibrium

- formulate the model recursively

-- determine state and control variables

-- formulate Bellman equation

-- derive first order conditions

-- derive optimality conditions

- analyticaly compute steady state of the model

- numerically compute value function by method of successive iteration

- compute decision rules

- calibrate structural parameters of simple growth model

- log-linearize model equation

- calculate moments in data

- determine behavior of variables during business cycle

- simulate model economy and compare model moments with moments from data

- apply these procedures in deterministic as well as in sochastic models

- analyze model with labor supply

- understand theory of balanced growth path

- stacionarize model by detrending of variables

- analyze model of overlapping generations and compare it to Ramsey model

- understand behavior of New Keynesian model in reaction to shocks

- compare models of Real business cycle and New Keynesian models **Syllabus**- National Accounts, Solow growth model
- Neoclassical growth model (inter- and intratemporal choice, equilibrium and the welfare theorems)
- Modelling of uncertainty (uncertainty and expected utility, Markov processes)
- Neoclassical growth model and dynamic programming (sequential methods, recursive methods)
- Stochastic neoclassical growth model (uncertainty and decision making)
- Quantitative business cycle analysis, Calibration
- Cost of business cycles
- Business cycle model with divisible labor supply
- Business cycle model with inidivisible labor supply
- Overlapping generations model
- New Keynesian model

**Literature**- MCCANDLESS, George T.
*The ABCs of RBCs : an introduction to dynamic macroeconomic models*. Cambridge, Mass.: Harvard University Press, 2008. xiv, 421. ISBN 9780674028142. info - Williamson, S. Notes on Macroeconomic Theory, http://www.econ.yale.edu/smith/econ510a/notes99.pdf

*required literature**Advanced macroeconomics*. Edited by David Romer. 3rd ed. Boston: McGraw-Hill, 2006. xxii, 678. ISBN 0072877308. info- Krueger, D. Quantitative Macroeconomics, http://www.econ.upenn.edu/~dkrueger/teaching/QuantMacroBook.pdf

*recommended literature*- MCCANDLESS, George T.
**Teaching methods**- lectures, reading of additional materials

seminars: theoretical exercises, computations in Matlab software, work with data

term paper **Assessment methods**- Term paper (necessary before taking exam): group project (2 students), two parts (empirical, theoretical); every student presents solution of assignment at seminar

Examination: written, minimum is 60 % **Language of instruction**- Czech
**Further comments (probably available only in Czech)**- Study Materials

The course is taught annually.

Information on course enrolment limitations: max. 20 cizích studentů; cvičení pouze pro studenty ESF **Information about innovation of course.**- This course has been innovated under the project "Inovace studia ekonomických disciplín v souladu s požadavky znalostní ekonomiky (CZ.1.07/2.2.00/28.0227)" which is cofinanced by the European Social Fond and the national budget of the Czech Republic.
**Teacher's information**- http://www.econ.muni.cz/~hlousek/teaching/mamo.html

- Enrolment Statistics (Autumn 2014, recent)
- Permalink: https://is.muni.cz/course/econ/autumn2014/MPE_MAMO