BEX5660 · Macroeconomic theory

Overview

This unit explores neoclassical macroeconomic theory, emphasising rigorous microfoundations, rational decision-making, market clearing, and the roles of technology and preferences in shaping aggregate outcomes. The first part of the unit focuses on growth theory, covering the Solow–Swan model, the Diamond overlapping-generations model, the Ramsey model, and New Growth models. These frameworks provide tools to analyse long-run growth, steady-state analysis, transition dynamics, and the effects of fiscal and/or monetary policies. The second part of the unit examines short-run fluctuations and business cycles, beginning with the fundamental building blocks of consumption–saving behaviour and expectations formation. These foundations support the analysis of Real Business Cycle and New Keynesian models, linking theoretical insights to macroeconomic policy and real-world applications.

Offerings

Assessment

The Handbook lists an examination for this unit.

Assessment details may change. Please refer to the assessment information in Moodle closer to the start of the teaching period.

Requisites

Learning outcomes

1. understand the basic theoretical structures common to modern dynamic macroeconomics. In particular, critical analysis of the economic reasons underlying the formation of policy and movements of various macro-aggregates
2. understand the key determinants affecting economic growth and fluctuations
3. enhance understanding of the basic theoretical approaches employed in specialist fields such as international economics, economic development/growth, applied general equilibrium and financial economics.

Workload

Minimum total expected workload to achieve the learning outcomes for this unit is 144 hours per semester typically comprising a mixture of scheduled learning activities and independent study. Independent study may include associated readings, assessment and preparation for scheduled activities. You are expected to complete all pre-class activities prior to your scheduled class, and post-class activities should be completed after your scheduled class. Learning activities may include a combination of teacher directed, peer directed and online engagement activities.

Student experience, not official rules. Nothing here changes what the Handbook says.