6 ECTS credits
150 h study time

Offer 1 with catalog number 1021577BNR for all students in the 1st semester at a (B) Bachelor - advanced level.

Semester
1st semester
Enrollment based on exam contract
Impossible
Grading method
Grading (scale from 0 to 20)
Can retake in second session
Yes
Enrollment Requirements
Students who want to enroll for this course, must have passed for 'Introduction to Macroeconomics' and must have obtained at least 30 ECTS-credits on bachelor level.
Taught in
English
Faculty
Faculty of Social Sciences & SolvayBusinessSchool
Department
Applied economics
Educational team
Ellen Van Droogenbroeck (course titular)
Eduardo Daniel López Vila
Activities and contact hours
24 contact hours Lecture
17 contact hours Seminar, Exercises or Practicals
141 contact hours Independent or External Form of Study
Course Content

The Intermediate Macroeconomics course teaches in a structured way how to look at general economic problems using economic models.
The course shows the relationship between economic growth in the long term, the different views on the supply side over the medium term, and business cycle fluctuations in the short term.
We explain economic fluctuations by the interaction of demand components (in a closed and an open economy) and the supply side.
We also stress the role of government in the economy, especially by the setting of monetary and budgetary policy.
We apply the economic models to real economic problems, to study the consequences of certain choices on the long and short term.
Especially for government intervention there is a trade off between short-and long-term effects of policy.

Course material
Handbook (Required) : Macroeconomics, Mankiw, N. G, 10de, London: Worth Palgrave MacMillan, 9781319243586, 2019
Additional info

Not applicable.

Learning Outcomes

General Competences

We first study long-term economic growth and then we discuss the short-term fluctuations in economic activity by a detailed analysis of the demand and supply side, to combine both in a study of government policy.

  1. Introduction
    • Understand the main economic quantities
    • Understand the links between the economic quantities
  2. Long-term economic growth
    • Understand the exogenous growth model  from Solow, and how capital accumulation determines  economic growth.
    • Know how the parameters of the Solow model determine growth.
    • Apply the Solow model on practical issues about development and economic growth.
  3. Economic fluctuations
    • 3.1. Demand side
      • Understand the main theories of consumption and investment
      • Understand how the monetary/financial system functions
      • Understand how an open economy differs from a closed economy
    • 3.2. Supply side
      • Understand the main theories that explain supply and the role that expectations play in it.
      • Understand how the supply side in the long and short term differs.
      • Know how government policy affects the supply side.
  4. Government policy
    • Understand the structure and the effects of monetary policy
    • Understand the structure and the effects of budgetary policy
    • Understand the economic and political considerations of government policy

In the general education that this course offers:

  • Look at problems with a critical approach
  • Make use of economic models to analyse general economic problems, and propose solutions
  • Apply economic models to critically analyse policy
  • Understand the limitations of macroeconomic analysis

Cursus specifieke competenties

These three models are the basic tools for macroeconomics.
Firstly, we expect you to flawlessly master the basic concepts of these models. You know their definition, know how to recognize this concept, how to calculate it, and how to apply it in a macroeconomic context.

With these elements you should be able to be shown the dynamic interaction between families, businesses, government, and the financial system (in a closed or an open economy). You will also know the operation of the main economic models and see how this interaction happens there.
 
In the classic model,
In the IS / LM and AD / AS model,
In the Solow model,
You may primarily reflect the effects of these models: you will know how the models are set up, what their basic elements, and how the economic cycle behaves in that model.
 
Afterwards you should be able to demonstrate a simulation of the operation of the models by setting up a thought experiment under certain scenarios. What happens if a specific economic event such as a change in policy, puts a dynamic in motion which affects all stakeholders in the economy? What are the results of that?
 
You can then also independently apply economic models to real economic problems, and the consequences of certain choices to study the long and short term, and to make a balance between the positive and negative effects on short- and long-term policy choices. You can study examples of economic phenomena and explain their kind in a structured way.
 
Each part of the course is more specifically focused on:
 
Part 1: Basic Concepts
  1. Understand the main economic variables
  2. Understand the (dynamic) coherence between economic variables.
Part 2: The medium term - the classic model
  1. Understand the economic cycle between families, businesses and government, and the crucial role of financial markets.
  2. Understand the operation of a basic classical model based on flexible pricing and assumptions about the behavior of the government and in a closed economy.
  3. Understand the different theories to explain consumption and investment behavior.
  4. Understand the role of monetary policy and the functioning of the financial system and the money market, and how savings and investments are essential to rebalance the economy over the medium term
  5. Understand how the organization of labor determines employment and GDP. See why the labor market is dynamic, and why unemployment arises. Make the distinction between frictional, natural and cyclical unemployment. Understand the Okun relationship.
Part 3: The short term - IS / LM - AD / AS
Demand
  1. Understand the main theories of consumption and investment.
  2. Understand the functioning of the monetary / financial system.
  3. Understand how different open a closed economy.
  4. Understand how the IS LM model is built from the demand side and the demand (consumption, investment, government) and the money market determine the interest rate and output.
  5. Understand how specific the general demand by price changes, driving through the money market, investment demand.
Supply side
  1. Understand the main theories that explain supply and the role that expectations play in it.
  2. Understand how the supply side is different in the long and short term
  3. Understand the equivalence between the supply curve and the Phillips curve.
Government policy
  1. Understand the structure and the effects of monetary policy.
  2. Understand the structure and the effects of fiscal policy.
  3. Understand the economic and political considerations of public policy.
Part 4: The long-term - the Solow model
  1. Understand the exogenous growth model of Solow, where capital accumulation determines economic growth.
  2. Know how to determine the parameters of the Solowmodel.
  3. Adjust the Solow model to practical issues about development and economic growth.

Grading

The final grade is composed based on the following categories:
Written Exam determines 100% of the final mark.

Within the Written Exam category, the following assignments need to be completed:

  • Written Exam with a relative weight of 100 which comprises 100% of the final mark.

Additional info regarding evaluation

Not applicable.

Allowed unsatisfactory mark
The supplementary Teaching and Examination Regulations of your faculty stipulate whether an allowed unsatisfactory mark for this programme unit is permitted.

Academic context

This offer is part of the following study plans:
Bachelor of Business Economics: Startplan Business Economics
Bachelor of Business Economics: Business and Technology
Bachelor of Business Economics: International Business
Preparatory Programme Master of Science in International Business: Default track
Preparatory Programme Master of Science in Business Engineering: Business and Technology: Default track