Macro Economics Theory & Policy - Final Exam

Economics 576.01W--02W

Macroeconomic Theory and Policy Summer I, 2014 – Online

Syllabus--Preliminary

Professor: Dale R. Funderburk Phone: 903-886-5675 Fax: 903-886-5601 E-mail: [email protected] Funderburk Faculty Website: http://faculty.tamu-commerce.edu/dfunderburk/

ABOUT THE COURSE - GENERAL FOCUS: Macroeconomics deals with the aggregate level of economic activity. Macroeconomic Theory and Policy focuses on several central questions: 1) What can we (reasonably) expect of the macroeconomy? 2) How do we evaluate performance on the macro level? 3) What makes the economy tick (or fail to tick)? 4) What happens when the macroeconomy fails to perform up to par? 5) Can we/how can we make the economy tick more smoothly? REQUIRED TEXT: There is not a required textbook. Required materials will be posted in DocSharing or else a link will be provided. I recommend that you have access to any standard macroeconomics principles text (list included in DocSharing) for review and/or background. Nature of the Course/Material Keep in mind that Economics 576 is a graduate level course in aggregate economics. A course in Macroeconomic Principles is a prerequisite for Economics 576. Please note that the concept of “prerequisite” is not about a check mark—it has to do with one’s background regarding preparedness to handle the material. Consequently you should have a general familiarity with and understanding of, the basic terminology and tools of macroeconomic analysis before you start this course. Inasmuch as summer sessions are short and go fast, it is important that you not start the course already behind. In case you have not taken any economics in several years, or if your course in macroeconomics was an institutional/non-analytical course, you may wish to check a principles text and/or course outline to update yourself on what is included in a macro principles course. Additionally, since macroeconomics is about relationships between different variables and responses to autonomous changes, shocks and/or policy changes in the economy, we will spend some time on multipliers. Multipliers are about numbers. Consequently, we will use some very elementary algebra to analyze the concept. This certainly will not be more advanced than a high school, first level course in algebra. And while you will not be required to solve algebra problems, you will need to be able to follow and understand material that is algebra based. If you are uncomfortable with the idea that the course will involve some elementary algebra, you may want to review a bit before the course begins. What to Expect From a Summer Online Class There are two factors that you should consider carefully before you start this course. First, you should keep in mind that summer sessions are compressed and go very fast. That means that it is critical that you read materials and do assignments when assigned. A person who hopes to do well in a summer class can ill

afford to fall behind. Second, online classes are different from face-to-face classes. Online education requires that the student be much more self directed and work independently. In an online course, the student accepts a higher degree of responsibility for learning outcomes. The instructor’s role is more that of facilitator and overseer—as opposed to lecturer/presenter. Both these factors mean that the student who takes such a class must be more disciplined than is normally the case with a long semester face-to- face class. Considering that a normal face-to-face, three semester hour course involves approximately 45 contact (in class) hours, that translates to nine hours per week for a five week summer session—and that is without allowing any time for writing papers, reading assignments, studying for exams, etc. If you do not have sufficient time to devote to the class each week, and/or if you are not comfortable with this type of setting, you probably should rethink taking this class in a summer, online format. Keep in mind that Economics 576 is a graduate level economics course, and the performance requirements will be commensurate with same. Webinars: A Class Live Pro Webinar is scheduled for each Tuesday and Wednesday from 6:30 pm to 8:30 pm, CDT. It is strongly recommended that you participate in these sessions. However, in case you are unable to participate at the scheduled time, the Webinars are recorded and you can watch/listen at any time after it is completed. In case you do miss a webinar, it is important that you access the recorded session as soon afterward as possible—sooner is preferable to later. The purpose of the Webinars will be to provide perspective relative to the material, to focus on and emphasize major topics and concepts, and to answer questions on the material. Office Hours: UPON REQUEST (which may be by email or phone—but must be at least 12 hours in advance), I will hold electronic office hours on Thursdays (6/05/2014 – 6/26/2014) between 7:00 pm and 8:00 pm CDT through your e-College site using Class Live Pro. Office hours normally will not be used to cover new material or as a substitute for attending or listening to the Webinars. However, these will provide the opportunity to ask questions about material—either already covered or upcoming. It is recommended that you consult your syllabus and the Course Pages in eCollege to see if your administrative and/or procedural questions/concerns are addressed there. You may e-mail me with questions concerning materials (not addressed in Webinars and/or office hours), and I will respond as promptly as practical. Please allow me up to 24 hours (during the week—not counting weekends) to reply. If you have not received a response within that time frame, please re-send the e-mail and call my office at 903-886-5675 (leaving a voice mail if not answered). COURSE GRADE: There will be either three or four components (your choice) to your course grade. First, there will be two exams. Exam I, which will cover material assigned for the first three weeks of the term, and will be available for the 60 hour period of noon, June 19 through midnight, June 21. Exam II, which will be comprehensive, will be the 48 hour period July 2 through July 3. The two exams will carry equal weight toward determination of your final course grade. Mark these exam dates on your calendar now. “Forgetting,” being “out of town” or “confused” about the time that the exam is available is not an acceptable excuse for missing it. Second, there will be two required special projects in the course. These will involve individually researched and written papers or problems regarding different topics/aspects of the course. You will have approximately one week’s notice before each of these papers is due. Your combined percentage score on these projects will carry the same weight as an exam relative to determining your semester grade. Third, there will be the opportunity (and option) of writing a term paper in the course. Generally, term papers must relate to macroeconomic theory and policy (You may wish to consult list of possible topics),

should be approximately 10-15 pages in length, and should be well organized, written, edited, and documented. Term papers are due by midnight, Saturday, June 28, 2014—NO EXCEPTIONS. For specifics, including topic suggestions and requirements/expectations, see About Term Papers Finally, there may be a bonus problem or short paper during the term. If and when this is offered, it will be relatively quick turn-around assignment—due within a week or less. This is one more reason that it is important to access the recorded webinar as soon after the session as possible, in case you miss one. Points earned on bonus assignments will be added to exam scores. To make an "A" in the course, you must average at least 90% on the exams and the projects, and turn in an acceptable term paper on an approved topic. To make a "B" in the course, either (1) you must average at least 75% on the exams and the projects (and you need not write a term paper), or (2) you may turn in a term paper, which will carry equal weight with the exams and the projects. Under this second option, the four grades (the two tests, the project percentage grade, and the term paper) must average at least 75%. To make a "C" in the course, either (1) you must average at least 60% on the exams and the projects (and you need not write a term paper), or (2) you may write a term paper. Under alternative (2) the exam scores, the projects percentage, and the term paper must average at least 60%. My “Negative” Note: I do not like to hear graduate students whine. (It makes me crazy.) I prefer to see my students perform. “Need” is not a factor in determining course grades, so please do not call or e-mail me telling me how much you need to make a certain grade. I also do not care what grade you made in all your other courses, nor do I care if you are allowed to work in “teams” in all your other classes and/or if you are awarded “participation” points in other courses. Grades are to be earned, not gifted. Please read and heed the material below under the heading “Hints for Making a Good Grade in this Course.” Tentative Outline/Schedule – Assignments and Materials Week 1 (June 2 – June 7) Introducing Macroeconomics

Reading: The Broken Window (macro/micro) Rational (macroeconomic) Policy Making Webinars: June 3, June 4 -- 6:30 p.m. Week 2 (June 9 – June 14) Macroeconomics- Measuring and Assessing Macro

Performance Macro models introduced

Aggregate Demand – Aggregate Supply Macro Macro 1 (DocSharing) Webinars –June 10, June 11-- 6:30 p.m. Week 3 (June 16 – June 21) Simple Keynesian Model Macro Macro 2 (DocSharing) Webinars – June 17, June 18. 6:30 p.m. Exam/Opportunity I – June 19 – June 21 (Thurs noon – Sat midnight: 60 hours)

Week 4 (June 23 – June 28) Expanding the Macro Model Equilibrium Income and Multipliers Webinars – June 24, June 25. 6:30 p.m. Week 5 (July 2 – July 5) Full macro model applied; expanding and tweaking the basic model; critique/limitations of model; alternative views of the macroeconomy Webinar: July 1, 6:30 p.m. Exam/Opportunity II – July 2 – 3 (Wed midnight – Thurs midnight: 48 hours) HINTS FOR MAKING A GOOD GRADE IN THIS COURSE

1. Note the prerequisite requirements. If you do not have the background for the course you are unlikely to do well—summers go too fast and online courses put too much responsibility on your own shoulders. If you are a “I don’t do well in economics” student, do NOT take this course online during the summer.

2. Attend the Webinars—come prepared, ask questions if you do not understand the material and/or assignments, stay alert and take good notes. If unable to participate in the actual webinar, access the recorded version as soon afterward as possible.

3. Take advantage of any bonus opportunity. 4. Read and study materials when assigned. Falling behind in a summer online

class can be fatal (grade-wise, of course). Additionally, Webinar sessions and class assignments make more sense if you come to class prepared

5. Turn in all projects and take exams on time—and in proper form (see below). Mark exam dates on your calendar now. Missing an exam is a very poor strategy for passing the course.

6. All assignments--tests and projects--are individual (not group) assignments. Make sure that the materials you submit reflect your (exclusive) work. 7. When you don’t understand material, ASK QUESTIONS—either in the Webinar,

by email, phone, or even make an appointment to come by my office. As soon as you realize that you are having problems in the course, contact me then.

Suggestions for submitting written assignments: 1. Save a backup copy when you submit. It may contain material or concepts that you will wish to review for the upcoming exam. 2. Put the assignment in your own words—DO NOT SEND ME ANY CUT AND PASTE ATTACHMENTS. I do not care to read National Bureau of Economic Research generated material about the NBER (relative, for example, to an assignment regarding business cycles). Tell me what you have to offer—but stick to facts and analysis, not unsupported opinion. 3. Put the assignment in your own words—DO NOT SEND ME A PAPER THAT IS IDENTICAL TO THAT SUBMITTED BY YOUR FELLOW CLASSMATE. The assignments are not group projects. 4. Treat each submission as a university, graduate level assignment—not a text message to a pal. Keep in mind that in a formal setting: a) grammar and spelling matter (and may be held against you); b) 2 and 4 are Arabic numerals, not prepositions; c) U and R are letters of the alphabet, not pronouns and contractions; d) “there” and “their” are not interchangeable words;

In general, ask yourself if your submission is of a quality and maturity that you would submit to an employer—assuming that you would like to keep your job and advance with the company.

Broad Course Objectives and Expectations Criteria (Course Objectives)

1 (Unsatisfactory) 2 (Marginal- Acceptable)

3 (Good-- Acceptable)

4 (Exemplary)

Relative to

macroeconomic

performance -- Demonstrate a familiarity

with U.S. national economic

performance objectives, be

able to access and employ

relevant data pertaining to

economic performance, and

understand the costs

associated with the failure

to achieve stated goals.

Student exhibits little

or no understanding

of the issues being

examined

Student makes

significant errors

with regard to the

significant issues

of the question or

problem being

examined, but at

least demonstrates

knowledge of

some of the major

points of the issues

Student

demonstrates

understanding of

the major points of

the issues being

examined but fails

to demonstrate

understanding of

all the details of

the issue

Student

demonstrates a

thorough

knowledge of the

issue being

examined

Relative to

discretionary

stabilization policy-- Demonstrate an

understanding of the nature

and function of monetary

and fiscal policy tools

available for the pursuit of

macroeconomic objectives

as well as limitations of

same.

Student exhibits little

or no understanding

of the issues being

examined

Student makes

significant errors

with regard to the

significant issues

of the question or

problem being

examined, but at

least demonstrates

knowledge of

some of the major

points of the issues

Student

demonstrates

understanding of

the major points of

the issues being

examined but fails

to demonstrate

understanding of

all the details of

the issue

Student

demonstrates a

thorough

knowledge of the

issue being

examined

Relative to

macroeconomic

theory—Demonstrate an understanding of the role of

macroeconomic theory and

data in the policy

formulation and

implementation process

Student exhibits little

or no understanding

of the issues being

examined

Student makes

significant errors

with regard to the

significant issues

of the question or

problem being

examined, but at

least demonstrates

knowledge of

some of the major

points of the issues

Student

demonstrates

understanding of

the major points of

the issues being

examined but does

not demonstrate

understanding of

all the details of

the issue

Student

demonstrates a

thorough

knowledge of the

issue being

examined