AØKK08198U Advanced Development Economics: Applied Macroeconomic and Policy Analysis

Volume 2014/2015
Education
MSc in Economics
Content

This course considers a range of policy-relevant topics that applied economists may face in low and middle income countries. The course focuses on short- and medium--run macroeconomic management issues. Topics covered include basic national accounts analysis, exchange rate management, monetary policies, public sector financing and natural resource revenue management. Where feasible, the course will consider political economy issues and emerging global challenges.

The course complements the existing Masters-level development economics courses (“Micro aspects” and “Macro aspects”). It makes a bridge between specific microeconomic topics and the fundamental determinants of growth. Also, it addresses new topics such as (shorter-run) macroeconomic management and the design of economic policies. The course should be especially relevant for students that seek to work in areas such as emerging markets finance, international organizations, government ministries, or diplomatic missions etc.

Students are expected to be actively involved, particularly in discussion of concrete policy problems and case studies.

Topics that may be covered include: Defining characteristics of developing countries; Challenges of applied macroeconomics and policy making in low income countries; National accounts analysis and extensions; International parity conditions; “Impossible Trinity”; Exchange rate evaluation methods; Instruments, targets & goals of monetary and exchange rate policy (MERP); New Keynesian and other MERP models; Operational and Policy issues of MERP; Fiscal sustainability analysis; Natural resource management.

Learning Outcome

The overall aim of the course is to provide students with core foundations to analyse and address applied macroeconomic and economic policy issues in low and middle income country contexts.

Having successfully taken this course, students should:

  • Understand the particular challenges, both theoretical and practical, facing macroeconomists and economic policy-makers working in/on developing countries;
  • Understand the functioning, strengths and weaknesses of key theoretical frameworks (“workhorse policy models”) used by applied economists in developing countries;
  • Be able to analyse national accounts and other macroeconomic indicators, thereby providing a coherent understanding of the structure of a given economy;
  • Understand the relevance of and rationale for making choices between alternative economic goals;
  • Be able to explain the principal monetary and exchange rate regime choices, trade-offs and management challenges facing for small open developing economies;
  • Understand the theoretical and practical issues involved in the economic management of potentially volatile external flows, such as those surrounding natural resource extraction;
  • Understand concepts and methods used for fiscal sustainability analysis; and
  • Demonstrate knowledge of the empirical literature, including country cases studies, that shed light on the range of topics covered in the course.

There is no single textbook for the course. Readings will be taken principally from assigned journal articles and working papers. Links to the required readings will be made available on the course website (Absalon).

Useful reference / background textbooks include:

  • Agénor, Pierre-Richard (2004). The Economics of Adjustment and Growth, Second Edition, Harvard University Press.
  • Gandolfo, Giancarlo (2002). International Finance and Open-Economy Macroeconomics, Springer.
  • Montiel, Peter J. (2003). Macroeconomics in Emerging Markets, Cambridge University Press.
Bachelor degree in economics, preferably including an introductory development economics course.
3 hours of lectures per week for 14 weeks.
  • Category
  • Hours
  • Exam
  • 3
  • Lectures
  • 42
  • Preparation
  • 161
  • Total
  • 206
Credit
7,5 ECTS
Type of assessment
Written examination, 3 hours under invigilation
3 hours written exam taking place at Peter Bangs Vej 36.
Aid
Without aids
Marking scale
7-point grading scale
Censorship form
External censorship
100 % censurship
Exam period
Will be updated before the start of the semester
Re-exam
Same as ordinary. But if only a few students have registered for the re-exam, the exam might change to an oral exams with a synopsis to be handed in. This means that the examination date also will change.
Criteria for exam assesment

The Student must in a satisfactory way demonstrate that he/she has mastered the learning outcome of the course.