（Preliminary, subject to change）

Advanced Macroeconomic Analysis

Ph.D. Program in Economics
Fall 2017
Suleyman Degirmen, Ph.D.
Professor of Economics
suleymandegirmen@gmail.com
Thursday, 13.15-16.15
Syllabus
Course Aims
This course develops core models of macroeconomics. Macroeconomics is an evolving
field: new facts and research cause the emergence of new ideas and models or in some
case the resurrection of old ideas and models. Macroeconomics is a vast discipline that
can maybe best defined by the questions the field try to answer. Why countries grow?
Why is there heterogeneity in growth resulting in inequality across and within countries?
Why there are cycles, crisis, boom and busts? Why there is unemployment? Why there is
inflation? Are all these questions related? What is the role of economic policy?

Textbooks:
I will base the course on two books below:

Advanced Macroeconomics, 3rd edition or above, David Romer, McGraw-Hill-Irwin

Publishers. (RO).

Macroeconomics: Imperfections, Institutions & Policies, Wendy Carlin and David

Soskice, Oxford University Press, 2006. (CS).

Supplementary readings include lecture notes, which I will distribute as we proceed, as

well as journal articles and selections from other books.

Learning Outcomes
1. Students will be able to use the terminology of macroeconomics to analyze issues
related to macroeconomic growth and fluctuations or business cycles.
2. This a quantitative course. It will incorporate theoretical and empirical tools. Students
will learn the terminology and analytical tools for analyzing macroeconomic issues.
3. Students will be able to collect, analyze and present macroeconomic data, attempt
to test hypotheses, and illustrate fundamental relationships..
(Tentative) Schedule for Fall 2017
Part I: Measurement in Macroeconomics (National and Regional)
National Income and Product Accounts

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Employment
Financial Markets
Fiscal and Monetary Variables

George Akerlof, —Behavioral Macroeconomics and Macroeconomic Behavior, American Economic Review,
June 2002, pp. 1-23.

Part II: Economic Growth I (RO-1, CS-13)

Neoclassical or Solow Growth Model
Stability Conditions and Growth
Growth Accounting

Readings:
(*) David Romer. Advanced MAcroeconomics, 4th Edition Chapter I, pages 6-30

Solow Robert, “A contribution to the theory of Economic Growth”, Quarterly Journal of Economics 70
(February 1956): 65-94. [This is for Introduction to Growth Facts and Growth Models]

Mankiw, N. G., D. Romer, and D. Weil. "A Contribution to the Empirics of Economic Growth." Quarterly
Journal of Economics 107 (1992): 401-437. [This is for Neoclassical Growth Model]

Solow Robert, “Technical Change and the Aggregate Production Function”, Review of Economics and
Statistics 39 (1957): 312-320.

Swan, T.W, “Economic Growth and Capital Accumulation”, Economic Record 32 (November 1956): 334-361.

Part III: Economic Growth II (RO-3, CS-14)

Endogenous Growth Models
AK Models
Knowledge Production Functions
Stability and Convergence

Readings:
(*) David Romer. Advanced MAcroeconomics, 4th Edition Chapter 3
Romer, P. M. "Increasing Returns and Long-Run Growth." Journal of Political Economy 94 (1986): S1002-
S1037.

Lucas, R. E., Jr. "On the Mechanics of Economic Development." Journal of Monetary Economics 22
(1988): 3-42.

Romer, P. M. "Endogenous Technological Change." Journal of Political Economy 98 (1990): 71-102.

[These 3 articles for EGM]
Part IV. Infinite Horizon (RO-2)
Infinite Horizon and OLG
Readings:

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 （Preliminary, subject to change）

David Romer. Advanced Macroeconomics, 3rd Edition, Chapter 2,

Barro, R. J. "Are Government Bonds Net Wealth?" Journal of Political Economy 82 (1974): 1095-1117.

Diamond, P. "National Debt in a Neoclassical Growth Model." American Economic Review 55 (1965): 1126-
1150. [these are for OLG]
Kydland, F., and Prescott, E. C. "Time to Build and Aggregate Fluctuations." Econometrica 50 (1982): 1345-
1370.

Lucas, R. E., Jr. "An Equilibrium Model of the Business Cycle." Journal of Political Economy 81 (1975): 1113-
1144. [These last two are for RBC]

Part V: Consumption and Investment

Consumption (RO-8, CS-7)
Readings:
Olivier Blanchard, Alessia Aminghini and Francesco Giavazzi Macroeconomics, a European Perspective.
Prentice Hall, 2010, chapter 16-17.

Robert Hall and Frederick Mishkin, "The Sensitivity of Consumption to Transitory Income: Estimates from
Panel Data on Households," Econometrica, March, 1982, pp. 461-482.

Chang-Tai Hsieh, —Do Consumers React to Anticipated Income Changes? Evidence from the Alaska
Permanent Fund,“ American Economic Review, March 2003, pp. 397-405.

Investment (RO-9, CS-7)

Owen Lamont, —Cash Flow and Investment: Evidence from Internal Capital Markets,“ Journal of Finance,.
52:1, (Mar., 1997), pp. 83-109.

Lawrence H. Summers, "Does the Stock Market Rationally Reflect Fundamental Values?" Journal of
Finance, July 1985, pp. 591-601.
Franco Modigliani and Merton H. Miller, "The Cost of Capital, Corporation Finance and the Theory of
Investment," American Economic Review, June 1958, pp. 261-297.
Labor Markets (RO-10, CS-4)
Shapiro, C. and J. Stiglitz. "Equilibrium Unemployment as a Worker Discipline Device." American Economic
Review 74 (1984): 433-444.
Janet Yellen, "Efficiency Wage Models of Unemployment," American Economic Review, May 1984, pp. 200-
205.
George Akerlof and Janet Yellen, "A Near Rational Model of the Business Cycle, with Wage and Price
Inertia,“ Quarterly Journal of Economics, September 1985, pp. 823-838. [This also helps to explain Part VI]
Charles Bean, "European Unemployment: A Survey," Journal of Economic Literature, June, 1994, pp. 573-
619.
Olivier Blanchard and Lawrence Katz, —What We Know and Do Not Know about the Natural Rate of
Unemployment,“ Journal of Economic Perspectives, Winter, 1997, pp. 51-72.

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Part VI: Short-Run Fluctuations (RO- 5-7, CS 2-5, 9-11)

IS-LM
Blanchard, O. "Why Does Money Affect Output? A Survey." In Handbook of Monetary Economics. Edited by
B. Friedman and F. Hahn. North Holland: 1990, pp. 779-835.

IS-MP-IA
Open Macroeconomy
J. Marcus Fleming, "Domestic Financial Policies under Fixed and under Floating Exchange Rates,"
International Monetary Fund Staff Papers, November, 1962, pp. 369-379.

Rudiger Dornbusch, "Expectations and Exchange Rate Dynamics," Journal of Political Economy,
December, 1976, pp. 1161-1176.

Uncovered Interest Parity

Flexible vs. Fixed Exchange Rates

Readings:
(*) David Romer. Advanced Macroeconomics, 4th Edition Chapter 5-7.
Prescott, E. C., "Theory Ahead of Business Cycle Measurement," Quarterly Review, Federal Reserve Bank of
Minneapolis, Fall 1986, 9-22
Finn Kydland and Edward Prescott’s Contribution to Dynamic Macroeconomics: The Time Consistency of
Economic Policy and the Driving Forces Behind Business Cycles, Advanced information on the Bank of
Sweden Prize in Economic Sciences in Memory of Alfred Nobel 11 October 2004
Kydland, F., and Prescott, E. C. (1982), “Time to Build and Aggregate Fluctuations,” Econometrica 50,
1345-1370.

Hartley, J.E., K.D. Hoover, K.D. Salyer (1997), “The limits of business cycle research: assessing the real
business cycle model”, Oxford Review of Economic Policy, 13(3).

Mankiw, N. G. "Small Menu Costs and Large Business Cycles: A Macroeconomic Model of
Monopoly." Quarterly Journal of Economics 100 (1985): 529-539. [This is for Incomplete Nominal
Adjustment]

George Akerlof and Janet Yellen, "A Near Rational Model of the Business Cycle, with Wage and Price
Inertia,“ Quarterly Journal of Economics, September 1985, pp. 823-838.

Romer, David and Laurence Ball, —Are Prices too Sticky?“ Quarterly Journal of Economics, August 1989,
pp. 507-524.

Alan Blinder, "Why are Prices Sticky? Preliminary Results from an Interview Study," American Economic
Review, May 1991, pp. 89100.

N. Gregory Mankiw and Ricardo Reis, —Sticky Information versus Sticky Prices: A Proposal to Replace the
New Keynesian Phillips Curve,“ Quarterly Journal of Economics, November 2002, pp. 1295-1328.

Part VII: Rational Expectations Models (RO-6, RO-7, RO-11, CS various)

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Consumption Behavior
Hall, R. E. "Stochastic Implications of the Life Cycle-Permanent Income Hypothesis: Theory and
Evidence." Journal of Political Economy 86 (1978): 971-987.

Policy Effectiveness Proposition

Time Inconsistency
Dynamic Neo-Keynesian Models
Readings:
Robert Barro and David Gordon, "A Positive Theory of Monetary Policy in a Natural Rate Model," Journal
of Political Economy, August 1983, pp. 589610.

John Taylor, "Discretion versus Policy Rules in Practice," Carnegie Rochester Series on Public Policy,
December, 1993, pp. 195-214.

Eldar Shafir, Peter Diamond, and Amos Tversky, "On Money Illusion," Quarterly Journal of Economics, May
1997, pp. 341-374.

Fehr, Ernst and Jean-Robert Tyran, —Does Money Illusion Matter?“ American Economic Review, December,
2001, pp. 1239-62.

Alberto Alesina and Lawrence Summers, "Central Bank Independence and Macroeconomic
Performance: Some Comparative Evidence," Journal of Money, Credit and Banking, May, 1993.

Adam Posen, "Central Bank Independence and Disinflationary Credibility: A Missing Link," Brookings
Discussion Papers in International Activity, No. 109, August, 1994.

Part VIII: Incomplete Financial Markets

Readings:

Obstfeld, M. "Risk-Taking, Global Diversification, and Growth." American Economic Review 84

(1994): 1310-1329.

Bernanke, B., and M. Gertler. "Agency Costs, Collateral, and Business Fluctuations." American Economic
Review 79 (1989): 87-114.

Greenwood, J., and B. Jovanovic. "Financial Development, Growth, and the Distribution of
Income." Journal of Political Economy 98 (1990): 219-240.

Banarjee, A., and A. Newman. "Occupational Choice in the Process of Development." Journal of Political
Economy 101 (1993): 274-298.

Lawrence H. Summers, "Does the Stock Market Rationally Reflect Fundamental Values?" Journal of
Finance, July 1985, pp. 591-601.

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ADVANCED MACROECONOMICS

（Preliminary, subject to change）

School of Economics
Shanghai University of Finance & Economics

Spring Term 2006

Prof. Hongjun ZHONG

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Email: hjzhong@mail.shufe.edu.cn
Class: 6:00pm-8:30pm Monday
Office Hour: 3:30pm-5:00pm Monday

TEXTBOOK (Required): David Romer, Advanced Macroeconomics, Third Edition.

McGraw-Hill, 2005.

Other Useful books:

Blanchard, O. and Stanley Fischer, Lecture Notes on Macroeconomics, MIT, 1990.

Gregory Mankiw and David Romer, New Keynesian Economics, MIT, 1998

READING LIST

I. Introduction and Mathematic Review

A. Overview of Course

*George Akerlof, —Behavioral Macroeconomics and Macroeconomic Behavior,“

American Economic Review, June 2002, pp. 1-23.

B. Introduction

David Romer, Third Edition, Chapter 5, "Traditional Keynesian Theories of

Fluctuations,“ Sections 5.1 and 5.3-5.6, pp. 222-231, and 242-270.

C. Mathematic Review
James Hamilton, Time Series Analysis, Ch2, “Lag Operators”, Section 2.1-2.3, pp
25-33.

II. Equilibrium Concepts

*David Romer, Third Edition, Chapter 6, "Microeconomic Foundations of

Incomplete Nominal Adjustment," Sections 6.1-6.3, and 6.9-6.10, pp. 271-
285, pp. 316-326.

*Robert Lucas and Thomas Sargent, "After Keynesian Macroeconomics," from

Federal Reserve Bank of Boston, After the Phillips Curve: Persistence of
High Inflation and High Unemployment, Conference Series No. 19.

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*Thomas Sargent, "Rational Expectations, the Real Rate of Interest, and the
Natural Rate of Unemployment," Brookings Papers on Economic Activity
1973:2, pp. 429-472.

*John Taylor, "Staggered Wage Setting in a Macro Model," American Economic

Review Papers and Proceedings, May 1979, pp. 108-113.

Calvo, Guillermo A., —Staggered Prices in a Utility-Maximizing

Framework,“ Journal of Monetary Economics, 12 (September 1983),
pp. 383-98.
Stanley Fischer, "Long-Term Contracts, Rational Expectations and the Optimal
Money Supply Rate," Journal of Political Economy, February 1977, pp. 191-
205.

Laurence Ball, "Credible Disinflation with Staggered Price Setting," American

Economic Review, March, 1994, pp. 282-289.

Carlton, Dennis, "The Rigidity of Prices," The American Economic Review,

September, 1986, pp. 637-658.

Steven Checchetti, "Staggered Contracts and the Frequency of Price Adjustment," The
Quarterly Journal of Economics, Supplement, 1985, pp. 935-959.

*David Romer, Third Edition, Chapter 10, "The Dynamic Inconsistency of Low-
Inflation Monetary Policy," Sections 10.4-10.7, pp. 506-538.

*Robert Barro and David Gordon, "A Positive Theory of Monetary Policy in a Natural
Rate Model," Journal of Political Economy, August 1983, pp. 589610.

John Taylor, "Discretion versus Policy Rules in Practice," Carnegie Rochester Series
on Public Policy, December, 1993, pp. 195-214.

Alberto Alesina and Lawrence Summers, "Central Bank Independence and

Macroeconomic Performance: Some Comparative Evidence," Journal of
Money, Credit and Banking, May, 1993.

Adam Posen, "Central Bank Independence and Disinflationary Credibility: A Missing

Link," Brookings Discussion Papers in International Activity, No. 109, August,
1994.

*Robert Shiller, "Why Do People Dislike Inflation?" in Reducing inflation : Motivation

and Strategy, edited by Christina D. Romer and David H. Romer. Chicago :
University of Chicago Press, 1997. Studies in Business Cycles : No. 30.

*Daniel Kahneman, Jack Knetsch and Richard Thaler, "Fairness as a Constraint on Profit
Seeking: Entitlements in the Market," American Economic Review, September

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1986, pp. 728-741.

*Eldar Shafir, Peter Diamond, and Amos Tversky, "On Money Illusion," Quarterly
Journal of Economics, May 1997, pp. 341-374.

III. New Keynesian Theories

*David Romer, Third Edition, Chapter 9.1-9.4, 9.9 "Unemployment," pp. 437-
460, 481-489.

*Janet Yellen, "Efficiency Wage Models of Unemployment," American

Economic Review, May 1984, pp. 200-205.

*Carl Shapiro and Joseph E. Stiglitz, "Equilibrium Unemployment as a Worker

Discipline Device," American Economic Review, June 1984, pp. 433-
444.

George Akerlof and Janet Yellen, "The Fair-Wage Effort Hypothesis and
Unemployment," Quarterly Journal of Economics, May 1990.

*David Romer, Third Edition, Chapter 6, Sections 6.4-6.6, —New

Keynesian Economics,“ pp. 286-302.

David Romer, Third Edition, Chapter 6, —Empirical Applications,“ and —

Mankiw-Reis Model,“ Sections 6.12-6.13, pp. 328-339.

*George Akerlof and Janet Yellen, "A Near Rational Model of the Business Cycle,
with Wage and Price Inertia,“ Quarterly Journal of Economics, September
1985, pp. 823-838.

*Gregory Mankiw, "Small Menu Costs and Large Business Cycles: A

Macroeconomic Model of Monopoly," Quarterly Journal of
Economics, May 1985, pp. 529-537.

*Fehr, Ernst and Jean-Robert Tyran, —Does Money Illusion Matter?“

American Economic Review, December, 2001, pp. 1239-62.

N. Gregory Mankiw and Ricardo Reis, —Sticky Information versus Sticky

Prices: A Proposal to Replace the New Keynesian Phillips Curve,“
Quarterly Journal of Economics, November 2002, pp. 1295-1328.

George Akerlof and Janet Yellen, "Can Small Deviations from Rationality Make
Significant Differences to Economic Equilibria?" American Economic
Review, September 1985, pp. 708-720.

Olivier Blanchard and Nobihiro Kiyotaki, "Monopolistic Competition and the

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Effects of Aggregate Demand," American Economic Review,

September, 1987, pp. 647-666.

Romer, David and Laurence Ball, —Are Prices too Sticky?“ Quarterly Journal of
Economics, August 1989, pp. 507-524.

Alan Blinder, "Why are Prices Sticky? Preliminary Results from an

Interview Study," American Economic Review, May 1991, pp.
89100.

IV. International Economics

*David Romer, Third Edition, Chapter 5, Section 5.2, —The Open Economy,“
pp. 231-241.

J. Marcus Fleming, "Domestic Financial Policies under Fixed and under

Floating Exchange Rates," International Monetary Fund Staff Papers,
November, 1962, pp. 369-379.

*Rudiger Dornbusch, "Expectations and Exchange Rate Dynamics," Journal

of Political Economy, December, 1976, pp. 1161-1176.

V. Consumption

*David Romer, Third Edition, Chapter 7, "Consumption," Sections 7.1-7.4,

and 7.6, pp. 346-365 and pp. 370-385.

*Milton Friedman, A Theory of The Consumption Function, Chapters I, II, and III,
pp. 3-37.

*Robert Hall, "Stochastic Implications of the Life Cycle-Permanent

Income Hypothesis: Theory and Evidence," Journal of Political
Economy, December 1978, pp. 971-987.

Chang-Tai Hsieh, —Do Consumers React to Anticipated Income Changes?

Evidence from the Alaska Permanent Fund,“ American Economic
Review, March 2003, pp. 397-405.

Lars P. Hansen and Kenneth J. Singleton, "Generalized Instrumental Variables

Estimation of Nonlinear Rational Expectations Models,"
Econometrica, September 1982, pp. 1269-1286.

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Henri Theil, "A Note on Certainty Equivalence in Dynamic

Planning," Econometrica, April 1957, pp. 346-349.

Robert Hall and Frederick Mishkin, "The Sensitivity of Consumption to

Transitory Income: Estimates from Panel Data on Households," Econometrica,
March, 1982, pp. 461-482.

Christopher Carroll, "The Buffer-Stock Theory of Saving: Some

Macroeconomic Evidence," Brookings Papers on Economic Activity,
1992:2, pp. 61-156.

Richard Thaler and H. M. Shefrin, "An Economic Theory of Self-Control,"

Journal of Political Economy, April 1981, pp. 392-406.

Gary Becker and Kevin Murphy, "A Theory of Rational Addiction," Journal
of Political Economy, August, 1988, pp. 675-700.

*David Laibson, Andrea Repetto and Jeremy Tobacman, —Self-Control and

Saving for Retirement," Brookings Papers on Economic Activity, 1998:1,
91-196.

Richard Thaler and Shlomo Benartzi, —Save More Tomorrow: Using

Behavioral Economics to Increase Employee Saving.“ Journal of
Political Economy, 112:1 Pt.2, Feb. 2004, pp. S164-S187.

Douglas Bernheim, Jonathan Skinner, and Steven Weinberg, —What Accounts

for the Variation in Retirement Wealth Among U.S. Households?“
American Economic Review 91 (September, 2001), pp. 832-55.

VI. Investment and Capital Theory

*Franco Modigliani and Merton H. Miller, "The Cost of Capital, Corporation

Finance and the Theory of Investment," American Economic Review,
June 1958, pp. 261-297.

Jensen, Michael C., and William H. Meckling, —Theory of the firm:

Managerial Behavior, Agency Costs and Ownership Structure,“ Journal
of Financial Economics, 3:4 (October 1976), pp.305-360.

Owen Lamont, —Cash Flow and Investment: Evidence from Internal

Capital Markets,“ Journal of Finance,. 52:1, (Mar., 1997), pp. 83-
109.
*David Romer, Third Edition, Chapter 8, "Investment," pp. 386-436.

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*Maurice Obstfeld and Kenneth Rogoff, Foundations of

International Macroeconomics, Cambridge, MA: 1996, pp.
105-113.

Lawrence Summers, "Taxation and Corporate Investment: A q-Theory

Approach," Brookings Papers on Economic Activity, 1981:1, pp. 67-127.

*Robert J. Shiller, "Do Stock Prices Move Too Much to be Justified by

Subsequent
Changes in Dividends?" American Economic Review, June 1981, pp. 421
436.

*Lawrence H. Summers, "Does the Stock Market Rationally Reflect

Fundamental Values?" Journal of Finance, July 1985, pp. 591-601.

Jeremy Bulow and Kenneth Rogoff, "The Buyback Boondoggle,"

Brookings Papers on Economic Activity, 1988:2, pp. 675-704.

Olivier Blanchard, "Movements in the Equity Premium," Brookings Papers

on Economic Activity, 1993:2, pp.75-138.

William Sharpe, "Capital Asset Prices: A Theory of Market Equilibrium Under

Conditions of Risk," Journal of Finance, September, 1964, pp. 425-
442.

*David Romer, Third Edition, Chapter 7, Sections 7.5, "Consumption and

Risky Assets," pp. 366-370.

Romer, David, "Rational Asset-Price Movements without News,"

American Economic Review, December, 1993, pp. 1112-1130.

VII. Nature of Unemployment and Other Theories of Unemployment

*David Romer, Third Edition, Chapter 6, Section 6.7, "Co-ordination Failure

Models and Real Walrasian Theories,“ pp. 303-309 and Chapter 9,
Sections 9.5-9.8, pp. 460-481.

Steven Davis and John Haltiwanger, "Gross Job Creation and Destruction:
Microeconomic Evidence and Macroeconomic Implications,"
NBER Macroeconomics Annual, 1990, pp. 123-168.

*Richard Nelson and Charles Plosser, "Trends and Random Walks in

Economic Time Series: Some Evidence and Implications", Journal of
Monetary Economics, September 1982, pp. 139-162.

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James Stock and Mark W. Watson, "Variable Trends in Economic Time Series,"
Journal of Economic Perspectives, Summer 1988, 147-174.

Avner Shaked and John Sutton, "Involuntary Unemployment as a Perfect

Equilibrium in a Bargaining Model", Econometrica, November 1984,
pp. 1351-1364.

Assar Lindbeck and Dennis Snower, "Cooperation, Harassment and

Involuntary Unemployment: An Insider-Outsider Approach",
American Economic Review, March 1988, pp. 167-188.

*Olivier Blanchard and Lawrence Summers, "Hysteresis and the European

Unemployment Problem", NBER Macroeconomic Annual, 1986, pp.15-78.

Olivier Blanchard and Justin Wolfers, —The Role of Shocks and Institutions in
the Rise of European Unemployment: The Aggregate Evidence,“
Economic Journal, March, 2000, pp. C1-33.

Lars Ljungqvist and Thomas Sargent, —The European Unemployment

Dilemma,“ Journal of Political Economy, June 1998, pp. 514-550.

Charles Bean, "European Unemployment: A Survey," Journal of

Economic Literature, June, 1994, pp. 573-619.

Olivier Blanchard and Lawrence Katz, —What We Know and Do Not Know
about the Natural Rate of Unemployment,“ Journal of Economic
Perspectives, Winter, 1997, pp. 51-72.

*Peter Diamond, "Aggregate Demand Management in Search

Equilibrium", Journal of Political Economy, October 1982, pp.
881-894.

*Peter Howitt and Robert Clower, —The Emergence of Economic

Organization,“ Journal of Economic Behavior and Organization, January
2000, pp. 55-84.

Joseph Stiglitz and Andrew Weiss, "Credit Rationing in Markets with

Imperfect Information," American Economic Review, June 1981, pp.
393-410.

Ben Bernanke, "Nonmonetary Effects of the Financial Crisis in the Propagation

of the Great Depression," American Economic Review, June 1983, pp.
257276.

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VIII. Economic Growth

A. The Solow Model

*Romer, David. Advanced Macroeconomics (second edition), 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.

*Hsieh, Chang-Tai, and Peter J. Klenow. 2004. "Relative Prices and Relative Prosperity"
Unpublished paper, Stanford University (August).

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

*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. 2004. "The Colonial Origins of Comparative Development: A

Reexamination Based on Improved Settler Mortality Data" Unpublished paper,
University of California, Berkeley (December).

*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.

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.

Barro, Robert and Xavier Sala-i-Martin. 2003. Economic Growth. Chapters 10 - 12.

C. The Ramsey-Cass-Koopmans Model

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

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 （Preliminary, subject to change）

*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. 2004. "Growth and Ideas" Unpublished paper, U.C. Berkeley
(September). Handbook of Economic Growth, forthcoming.

IX. Real Business Cycle Theory

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A. 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.

*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.

X. Fiscal Policy and Budget Deficits

*Romer, David. Advanced Macroeconomics, Chapter 11.

*Auerbach, Alan J., William G. Gale, and Peter R. Orszag. 2004. "Sources of the Long-
Term Fiscal Gap." Tax Notes 103 (May 24): 1049-1059.

Barro, Robert J. 1979. "On the Determination of the Public Debt." Journal of Political
Economy 87 (October): 940-971.

Tabellini, Guido, and Alberto Alesina. 1990. "Voting on the Budget Deficit." American
Economic Review 80 (March): 37-49.

Alesina, Alberto, and Allan Drazen. 1991. "Why Are Stabilizations Delayed?" American
Economic Review 81 (December): 1170-1188.

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 （Preliminary, subject to change）

*Roubini, Nouriel, and Jeffrey D. Sachs. 1989. "Political and Economic Determinants of
Budget Deficits in the Industrial Democracies." European Economic Review 33 (May):
903-933.

Grilli, Vittorio, Donato Masciandaro, and Guido Tabellini. 1991. "Political and Monetary
Institutions and Public Financial Policies in the Industrial Countries." Economic Policy
13 (October): 341-392.

*Pettersson-Lidbom, Per. 2001. "An Empirical Investigation of the Strategic Use of

Debt." Journal of Political Economy 109 (June): 570-583.

Please also consider

EMERGING MARKETS
RESILIENCE AND GROWTH AMID GLOBAL TURMOIL
M. Ayhan Kose and Eswar S. Prasad

Useful links for lecture materials:

http://web.econ.unito.it/bagliano/phd_dyn_macro_2013.html
http://econphd.econwiki.com/notes.htm
http://courses.washington.edu/econ502/
http://www.econ.ku.dk/okocg/VM/VM-general/Material/Chapters-VM.htm (very good)
http://www.econ.ku.dk/okocg/VM/VM13/Advanced%20Macro-2013.htm (very good)
http://home.ust.hk/~davcook/EC514.html (very much usefull)
http://www.fordham.edu/economics/mcleod/ECGA7020.htm (usefull for preliminary
exams)

Also pay attention to following link:

http://ciep.itam.mx/~rahul.giri/applied-macroeconomics-fall-2013.html

http://econ.ucsb.edu/~bohn/204A/204Aindex.html (Access date: 10 Eylül 2017)

https://sites.google.com/site/serdarozkan/teaching/eco2061-2015s/eco2061outline2015s
(Usefull...but, materials are not reachable..)

https://sites.google.com/site/serdarozkan/teaching/eco2031-2017s

(Usefull...but, materials are not reachable..)

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