Economics 202B -- Macroeconomics

Professors: David Romer (dromer@econ). Office Hours: Tuesdays, 1:30-3:30pm.
                Chad Jones (chad@econ). Office Hours: Mondays, 1-3pm.

TA (1st half): Li Zeng, lzeng@berkeley.edu
TA (2nd half): Gewei Wang, gewei@berkeley.edu
Midterm: March 15 in Class
Final Exam: Wednesday, May 16, 8-11am.

Copy of last year's final exam.
Copy of last year's midterm.

Problem Sets: PS 1 | PS 2 | PS 3 | PS 4 | PS 5 | PS 6 | PS 7 | PS 8 | PS 9 | PS 10 | PS 11 | PS 12 | PS 13
Two handouts on DSGE Models: Saving Rate | Log-linearization

 

Starred (*) readings are required and will be available in the Course Reader or the Romer textbook. The others are useful references.

I. Economic Growth Web Links on Economic Growth
Draft of Daron Acemoglu's book, Introduction to Modern Economic Growth.

A. The Solow Model

*Romer, David. 2006. Advanced Macroeconomics. Third edition. New York: McGraw-Hill. Chapter 1.

Solow, Robert. 1956. "A Contribution to the Theory of Economic Growth" Quarterly Journal of Economics 70:65-94.

B. Cross-Country Income Differences

*Romer, David. Advanced Macroeconomics, Chapter 3, Part B.

*Hall, Robert E. and Charles I. Jones. 1999. "Why Do Some Countries Produce So Much More Output per Worker than Others?" Quarterly Journal of Economics 114:83-116.

Klenow, Peter J., and Andres Rodriguez-Clare. 1997. "The Neoclassical Revival in Growth Economics: Has It Gone Too Far?" NBER Macroeconomics Annual 12: 73-103.

Hsieh, Chang-Tai, and Peter J. Klenow. 2006. "Relative Prices and Relative Prosperity" Unpublished paper, UC Berkeley (September), American Economic Review, forthcoming.

*Acemoglu, Daron. 2003. "Why Not a Political Coase Theorem? Social Conflict, Commitment and Politics." Unpublished paper, M.I.T. (August). Journal of Comparative Economics, forthcoming.

*Parente, Stephen L., and Edward C. Prescott. 1999. "Monopoly Rights: A Barrier to Riches" American Economic Review 89 (December): 1216-1233.

*Glaeser, Edward L., Rafael La Porta, Florencio Lopez-de-Silanes, and Andrei Shleifer. 2004. "Do Institutions Cause Growth?" Journal of Economic Growth 9 (September): 271-303.

Acemoglu, Daron, Simon Johnson, and James A. Robinson. 2001. "The Colonial Origins of Comparative Development: An Empirical Investigation." American Economic Review 91 (December): 1369-1401.

Albouy, David. 2006. "The Colonial Origins of Comparative Development: A Reexamination Based on Improved Settler Mortality Data" Unpublished paper, University of California, Berkeley (May).

Acemoglu, Daron, and Simon Johnson. 2006. "Disease and Development: The Effect of Life Expectancy on Economic Growth." National Bureau of Economic Research Working Paper No. 12269 (May).

Barro, Robert and Xavier Sala-i-Martin. 2004. Economic Growth, second edition. Chapters 10 - 12.

C. The Ramsey-Cass-Koopmans Model

*Romer, David. Advanced Macroeconomics, Chapter 2, Part A.

*Barro, Robert and Xavier Sala-i-Martin. Economic Growth. Chapter 2 and Appendix A.3 (at end of book)

Weitzman, Martin. 2003. Income, Wealth, and the Maximum Principle (Harvard University Press).

Obstfeld, Maurice. 1992. "Dynamic Optimization in Continuous-Time Economic Models (A Guide for the Perplexed)" Part 1.

D. The Diamond OLG Model

*Romer, David. Advanced Macroeconomics, Chapter 2, Part B.

Diamond, Peter. 1965. "National Debt in a Neoclassical Growth Model" American Economic Review 55:1126-1150.

E. Endogenizing Growth

*Romer, David. Advanced Macroeconomics, Chapter 3, Part A.

Rebelo, Sergio. 1991. "Long-Run Policy Analysis and Long-Run Growth" Journal of Political Economy 99:500-521.

*Lucas, Robert E. 1988. "On the Mechanics of Economic Development" Journal of Monetary Economics 22:3-42.

*Romer, Paul M. 1990. "Endogenous Technological Change" Journal of Political Economy 98:S71-S102.

Jones, Charles I. 1995. "R&D-Based Models of Economic Growth" Journal of Political Economy 103:759-784.

Kremer, Michael. 1993. "Population Growth and Technological Change: One Million B.C. to 1990" Quarterly Journal of Economics 108:681-716.

*Jones, Charles I. 2005. "Growth and Ideas" in P. Aghion and S. Durlauf (eds.) Handbook of Economic Growth (Elsevier) Volume 1B, pp. 1063-1111.

II. DSGE Models of Flucations

A. Introduction to Dynamic Programming

*Ljungqvist, Lars and Thomas J. Sargent. 2004. Recursive Macroeconomic Theory (MIT Press, 2nd Edition), Chapters 1 and 3.

Greenwood, Jeremy. 2001. Lecture Notes on Dynamic Competitive Analysis University of Rochester mimeo.

B. Business Cycles in the Neoclassical Growth Model

*Romer, David. Advanced Macroeconomics, Chapter 4.

Lucas, Robert E. "Macroeconomic Priorities" American Economic Review, March 2003, pp. 1-14.

*Cooley, Thomas F. and Edward C. Prescott. 1995. "Economic Growth and Business Cycles." Chapter 1 of Cooley (ed.) Frontiers of Business Cycle Research

*Campbell, John Y. 1994. "Inspecting the Mechanism: An Analytical Approach to the Stochastic Growth Model" Journal of Monetary Economics 33:463-506.

Prescott, Edward. 1986. "Theory Ahead of Business Cycle Measurement" Federal Reserve Bank of Minneapolis Quarterly Review 10(4):1-22.

Summers, Lawrence. 1986. "Some Skeptical Observations on Real Business Cycle Theory" Federal Reserve Bank of Minneapolis Quarterly Review 10(4):23-27.

Uhlig, Harald "A Toolkit for Analyzing Nonlinear Dynamic Stochastic Models Easily" 1997. See also http://www.wiwi.hu-berlin.de/wpol/html/toolkit.htm.

*Hansen, Gary and Randall Wright. 1992. "The Labor Market in Real Business Cycle Theory" Federal Reserve Bank of Minneapolis Quarterly Review 16(2).

Chari, V.V., Kehoe, Patrick J. and Ellen R. McGrattan. 2002. "Business Cycle Accounting" Federal Reserve Bank of Minneapolis Working Paper No. 625.

III. Fiscal Policy and Budget Deficits

See David Romer's syllabus, here.