AØKK08212U International Macroeconomics (F)

Volume 2015/2016
Education

Elective at MSc in Economics

The course is part of the Financial line symbolized by "F".

Content

This is a graduate level course in international macroeconomics. Topics covered include:

  • International business cycles: Measurement and empirical facts
  • Benchmark international macro models: Small open economy and two-country international real business
  • cycle model
  • Uncertainty and international financial markets, including international risk sharing, portfolio diversification,
  • home bias puzzles
  • International capital flows and global imbalances
  • Imperfections in international capital markets: Empirics and theories of sovereign debt and default, sudden
  • stops and self-fulfilling crises
  • Nominal rigidities and exchange rate policy in open economies
  • Selected recent papers in international macro

 

Throughout the course there will be a focus on applied work - students will learn how to work with the data and solve numerically the models we discuss. We will use Matlab and Stata for this but no prior knowledge of these packages is assumed.

Learning Outcome

The goal of the course is to provide students with a throrough understanding of the main theories and empirical research in international macroeconomics. By the end of the course they should be able to

  • Describe international business cycle facts

  • Describe and analyze core international macro models (small open economy and international real business cycle model)

  • Describe, analyze and critically reflect on key concepts and applications including risk sharing, portfolio diversification, international capital flows and capital market imperfections, based on the core models

They should have acquired the tools necessary to be able to read the latest theoretical and empirical research in the field, and to start using and applying the theories and concepts independently.

Syllabus:

Textbook:

  • Obstfeld , M. and K. Rogoff, Foundations of International Macroeconomics, MIT Press 1996, Ch.1-2, 5-6.

Articles:

  • Backus, D. K., Kehoe, P. J. and Kydland, F. E. (1994), Dynamics of the Trade Balance and the Terms of Trade: The J-Curve?, American Economic Review 84(1), 84103.

  • Backus, D. K. and Smith, G. W. (1993), Consumption and real exchange rates in dynamic economies with non-traded goods, Journal of International Economics 35(3-4), 297_316.

  • Baxter, M. and Crucini, M. J. (1995), Business Cycles and the Asset Structure of Foreign Trade, International Economic Review 36(4), 82154.

  • Schmitt-Grohe, S. and Uribe, M. (2003), Closing small open economy models, Journal of International Economics 61(1), 163_185.

  • Neumeyer, P. A. and Perri, F. (2005), Business cycles in emerging economies: the role of interest rates, Journal of Monetary Economics 52(2), 345380.

  • Lucas, Robert E, J. (1990), Why Doesn't Capital Flow from Rich to Poor Countries?, American Economic Review 80(2), 92_96.

  • Gourinchas, P.-O. and Jeanne, O. (2013), Capital Flows to Developing Countries: The Allocation Puzzle, Review of Economic Studies 80(4), 14841515

  • Heathcote, J. and Perri, F. (2013), The International Diversfication Puzzle Is Not as Bad as You Think, Journal of Political Economy 121(6), 1108 _ 1159.

Total number of pages: 450

Additional readings will be announced at the start of the course.

BSc in Economics. It is strongly recommended that Micro C and Macro C has been followed prior to taking "International Macroeconomics".
Schedule:

The course consists of 3 hours of classes (lectures) every week for 14 weeks.

For enrolled students please find more information of courses, schedule, rules etc at
https:/​/​intranet.ku.dk/​economics_ma/​courses/​Pages/​default.aspx

Timetable and classroom:
For time and classroom please press the link under "Se skema"(See schedule) at the right side of this page (15E means 2015 Autumn)
  • Category
  • Hours
  • Exam
  • 3
  • Lectures
  • 42
  • Preparation
  • 161
  • Total
  • 206
Credit
7,5 ECTS
Type of assessment
Written examination, 3 hours under invigilation
Individual written closed book exam at the computers of Copenhagen University
Exam registration requirements

3 homework assignments completed and approved

Aid
Without aids
Marking scale
7-point grading scale
Censorship form
External censorship
100 % censorship
Exam period

The exam takes place 18 December 2015 at Peter Bangs Vej 36. 2000 Frederiksberg http:/​/​pc-eksamen.ku.dk/​pc_exam

For enrolled students more information about examination, exam/re-sit, rules etc. is available at the student intranet for Examination (English) and student intranet for Examination (KA-Danish).

Re-exam

Same as the ordinary exam. But if only a few students have registered for the re-exam, the exam might change to an oral exam. 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.