2021 | Macroeconomics I - TOKYO TECH OCW

Undergraduate
Graduate

2021　Macroeconomics I

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Academic unit or major: Undergraduate major in Industrial Engineering and Economics

Instructor(s): Ohdoi Ryoji

Class Format: Lecture

Media-enhanced courses

Day/Period(Room No.): Tue7-8(S222) Fri7-8(S222)

Group: -

Course number: IEE.B203

Credits: 2

Academic year: 2021

Offered quarter: 2Q

Syllabus updated: 2021/3/19

Lecture notes updated: -

Language used: Japanese

Access Index

Syllabus

Course description and aims

With microeconomics, macroeconomics is one of the most fundamental fields in economics, dealing with the aggregated economic variables such as GDP, unemployment rate, price index, and so on.

This course provides a basic view of macroeconomics at the undergraduate level. The first half of this course covers measurement of macroeconomic activity, households' consumption-saving behavior, firms' production-investment behavior, and the role of financial asset markets and money. Then, the second half focuses on how major macroeconomic variables are determined in both long-run and short-run equilibria. We also discuss the effectiveness of fiscal and monetary policies.

The aim of this course is twofold. First, students can precisely explain the definitions of the aforementioned major macroeconomic variables which they roughly know through newspapers and evening news. Second, they can construct a simple mathematical model to analyze the mechanics of how the variables are determined.

Student learning outcomes

By the end of this course, students will be able to:
1) Using the definitions, calculate major macroeconomic variables, including GDP, inflation rate, unemployment rate, current account, etc.
2) Understand how decisions made by economic agents (e.g., households and firms) determine such macroeconomic variables.
3) Explain the role of money, financial markets, and banks by using a simple model.
4) Grasp the differences between long-run and short-run macroeconomic equilibrium and discuss the effectiveness of fiscal and monetary policies in each time frame.

Keywords

nominal GDP, real GDP, GDP deflator, consumption price index (CPI), unemployment rate, consumption, investment, saving, long-run macroeconomic equilibrium, economic growth theory

Competencies that will be developed

✔ Specialist skills

✔ Intercultural skills

Communication skills

Critical thinking skills

Practical and/or problem-solving skills

Class flow

As stated in the "Course schedule," two times are used for one topic like household's behavior, firm's behavior, and so on.

Course schedule/Required learning

	Course schedule	Required learning
Class 1	Introduction to Macroeconomics	Understand the purpose of macroeconomics and the meanings of macroeconomic variables observed in real life.
Class 2	Measuring the Macroeconomic Performance (1): Nominal GDP, Real GDP and Price Index	Explain the definition of GDP, the difference between nominal GDP and real GDP, and the role of price index.
Class 3	Households's Behavior (1): Intertemporal Choice of Consumption Plan in a Two-period model	Derive the optimal consumption through intertemporal utility maximization.
Class 4	Households's Behavior (2): Intertemporal Choice of Consumption Plan in a Two-period model	Explain the role of savings from the viewpoint of utility maximization.
Class 5	Firms' Behavior of Production of Investment (1)	Derive the optimal investment plan of firms.
Class 6	Firms' Behavior of Production of Investment (2)	Derive the optimal investment plan of firms.
Class 7	The Role of Financial Asset Markets for the Macroeconomy	Understand the role of financial asset markets for the macroeconomy.
Class 8	Money and the Central Bank	Understand the definition of money, and explain how the central bank affects us through monetary policy.
Class 9	Midterm Examination	Review of the first half of the course (classes 1-8)
Class 10	Long-run Macroeconomic Equilibrium (1): Determination of GDP in Equilibrium	Derive the two-period macroeconomic equilibrium with flexible prices.
Class 11	Long-run Macroeconomic Equilibrium (2): Effects of Fiscal Policy in the Long-run	Understand the role of the government in the long-run.
Class 12	Economic Growth Theory (1): The Solow Growth Model	Understand the Solow model.
Class 13	Economic Growth Theory (2): The Role of Technological Progress	Under stand the role of technological progress for economic growth
Class 14	Review of The Course	Review of the course.

Out-of-Class Study Time (Preparation and Review)

To enhance effective learning, students are encouraged to spend approximately 100 minutes preparing for class and another 100 minutes reviewing class content afterwards (including assignments) for each class.
They should do so by referring to textbooks and other course material.

Textbook(s)

Handouts or slides used for each class will be available on the corresponding page of Tokyo Tech OCW-i.

Reference books, course materials, etc.

Mankiw, N.G. Macroeconomics, Worth Publishing.
Futagami, K. and Hori, K. Macroeconomics, Yuhikaku (in Japanese)
Shibata, A. and Unayama, T. First Steps in Macroeconomics, Yuhikaku (in Japanese)
Hiraguchi R. and Inaba, M. Macroeconomics: From Basic Principles to Applications, Yuhikaku (in Japanese)

Assessment criteria and methods

The grade is based on the midterm- and final assignments.

Related courses

IEE.B204 ： Macroeconomics II
IEE.B201 ： Microeconomics I
IEE.B202 ： Microeconomics II
IEE.B332 ： Applied Macroeconomics

Prerequisites (i.e., required knowledge, skills, courses, etc.)

Although there is no explicit prerequisite for this course, basic knowledge of microeconomics covered in "Microeconomics I" is highly recommended.

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