Students
ECON3011 – Macroeconomic Policy
2020 – Session 1, Weekday attendance, North Ryde
Coronavirus (COVID-19) Update
Due to the Coronavirus (COVID-19) pandemic, any references to assessment tasks and on-campus delivery may no longer be up-to-date on this page.
Students should consult iLearn for revised unit information.
Find out more about the Coronavirus (COVID-19) and potential impacts on staff and students
General Information
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| Unit convenor and teaching staff |
Unit convenor and teaching staff
Professor
Jeffrey Sheen
Room 432, E4A Building
Thursdays 3-5pm
Professor
David Orsmond
|
|---|---|
| Credit points |
Credit points
10
|
| Prerequisites |
Prerequisites
20cp at 2000 level including ECON204 or ECON2004
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| Corequisites |
Corequisites
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| Co-badged status |
Co-badged status
|
| Unit description |
Unit description
This unit develops macroeconomic models with a focus on key contemporary issues such as persistent low inflation, interest rates, secular stagnation, alternative monetary policy frameworks, fiscal policy constraints, understanding financial crises, financial regulation and cryptocurrencies. Students will develop an understanding of the reasons for these problems, and how key policy institutions such as the RBA, APRA and Treasury are addressing them. |
Important Academic Dates
Information about important academic dates including deadlines for withdrawing from units are available at https://www.mq.edu.au/study/calendar-of-dates
Learning Outcomes
On successful completion of this unit, you will be able to:
- ULO1: Analyse and explain macroeconomic policy in a general framework.
- ULO2: Appraise how monetary and fiscal policies are determined in the context of the current economic environment.
- ULO3: Critically evaluate the effectiveness of current macroeconomic policy in achieving stated goals.
Assessment Tasks
Coronavirus (COVID-19) Update
Assessment details are no longer provided here as a result of changes due to the Coronavirus (COVID-19) pandemic.
Students should consult iLearn for revised unit information.
Find out more about the Coronavirus (COVID-19) and potential impacts on staff and students
Delivery and Resources
Coronavirus (COVID-19) Update
Any references to on-campus delivery below may no longer be relevant due to COVID-19.
Please check here for updated delivery information: https://ask.mq.edu.au/account/pub/display/unit_status
Lectures
Lectures are on Tuesdays 6-9pm in 23 Wallys Walk - T1 Theatre. While not compulsory, you are strongly advised to attend all lectures.
Required and Recommended Texts and/or Materials
There is no required textbook for this course.
It is assumed that you understand well an intermediate macroeconomics textbook eg
O. Blanchard and J. Sheen, Macroeconomics, 2014, 4th edition, Pearson
A good reference text for this unit is:
S. Williamson, Macroeconomics , 2018, 6th global edition, Pearson
Useful readings for the topics are given in the Unit Schedule, and extra readings may be recommended during the lectures.
Unit Schedule
Coronavirus (COVID-19) Update
The unit schedule/topics and any references to on-campus delivery below may no longer be relevant due to COVID-19. Please consult iLearn for latest details, and check here for updated delivery information: https://ask.mq.edu.au/account/pub/display/unit_status
WEEKS 1-2 Refresher on ISLM, AS-AD; Malthusian growth model, Solow growth model, Endogenous growth models
Blanchard and Sheen 2013 Chs 5-12
Williamson Chs 1,-3, 7-8
WEEK 3 Low inflation, the natural rate of unemployment
Blanchard, O. 2018 Should we reject the natural rate hypothesis? Journal of Economic Perspectives, Vol 32, 1 Winter 2018 https://pubs.aeaweb.org/doi/pdf/10.1257/jep.32.1.97
Cassidy, N., Rankin,E., Read, M. and Seibold,C. 2019 Explaining Low Inflation Using Models. https://www.rba.gov.au/publications/bulletin/2019/jun/explaining-low-inflation-using-models.html
Williamson Chs 14-15
WEEK 4 Secular stagnation, potential growth and technology
Arsov, I and Watson, B. 2019 Potential Growth in Advanced Economies RBA Bulletin 12 December 2019 https://www.rba.gov.au/publications/bulletin/2019/dec/potential-growth-in-advanced-economies.html
Gordon, R. 2014 US Economic Growth is Over: The Short Run Meets the Long Run, Think Tank 20: Growth, Convergence and Income Distribution: The Road from the Brisbane G-20 Summit: https://www.brookings.edu/wp-content/uploads/2016/07/tt20-united-states-economic-growth-gordon.pdf
WEEK 5 Monetary policy frameworks – inflation targeting and alternatives
Debelle, G. 2018 Twenty-five Years of Inflation Targeting in Australia. RBA Conference, Cenral Bank Frameworks: Evolution or Revolution? 2018 https://www.rba.gov.au/speeches/2018/sp-dg-2018-04-12.html
Rogoff, K. 2017. Dealing with monetary paralysis at the zero bound. Journal of Ecoomic Perspectives, https://scholar.harvard.edu/files/rogoff/files/dealing_with_monetary_paralysis_at_the_zero_bound.pdf
Williamson Ch 15
WEEK 6 Links between fiscal policy and monetary policy – the government budget constraint, the fiscal theory of prices, hyperinflation
Blanchard and Sheen 2013 Chs 23-24
Blanchard, O. (2019) Public Debt and Low Interest Rates, American Economic Review, www.piie.com/system/files/documents/wp19-4.pdf
Cochrane, J. (2011): Understanding Policy in the Great Recession: Some Unpleasant Fiscal Arithmetic. European Economic Review January 2011 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1619585
WEEK 7 Mid-semester test
WEEK 8 The causes of financial crises and policy responses (DO)
Reinhard, C. and K. Rogoff (2008), This Time is Different: Eight Centuries of Financial Folly, NBER Pape 13882, March https://www.nber.org/papers/w13882.pdf
RBA Explainer: The Global Financial Crisis, https://rba.gov.au/education/resources/explainers/pdf/the-global-financial-crisis.pdf
Williamson Ch. 18
WEEK 9 Financial regulation: Principles and practice (DO)
Yuksel, M. (2019), ‘A decade of post-crisis G20 financial sector reforms,’ RBA Bulletin, June https://rba.gov.au/publications/bulletin/2019/jun/pdf/a-decade-of-post-crisis-g20-financial-sector-reforms.pdf
Orsmond. D. and F. Price (2016), ‘Macroprudential policy frameworks and tools,’ RBA Bulletin, December https://www.rba.gov.au/publications/bulletin/2016/dec/pdf/rba-bulletin-2016-12-macroprudential-policy-frameworks-and-tools.pdf
WEEKS 10-11 Official Australian and global economy reports Latest RBA Statement on monetary policy
Commonwealth Budget statements
World Economic Outlook
WEEK 12-13 Digital money and the payments system; the future of cryptocurrencies – eg Bitcoin, Libra
Dark, C., Emery, D, Ma,J. and Noone, C. 2019 Cryptocurrency: Ten Years On. RBA Bulletin, www.rba.gov.au/publications/bulletin/2019/jun/cryptocurrency-ten-years-on.html
Kumar, A, Smith. C 2017 Crypto-currencies – An introduction to not-so-funny moneys, www.rbnz.govt.nz/media/ReserveBank/Files/Publications/Analytical%20notes/2017/an2017-07.pdf
Härdle, W. and Harvey, C. and Reule, R., Understanding Cryptocurrencies (March 26, 2019). https://ies.keio.ac.jp/upload/20191125econo_Wolfbang_wp.pdf
RBA Submission to the Senate Select Committee on Financial and Regulatory Technology Dec 2019 https://www.rba.gov.au/publications/submissions/payments-system/financial-and-regulatory-technology/pdf/financial-and-regulatory-technology.pdf
Williamson Chs 18
WEEK 13 Unit summary
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Changes from Previous Offering
Unit has been changed to include much more on contemporary policy issues,
Changes since First Published
| Date | Description |
|---|---|
| 13/02/2020 | Corrections |