Honors | Introduction to Macroeconomics - Honors (ECON)
S202 | 6414 | Gerhard Glomm
Course Objectives: Macroeconomics studies economy-wide phenomena. Of
course, economy wide phenomena can only be understood if we
understand how individuals make decisions. In Macroeconomics we thus
have to aggregate up individual decisions. In other words, we need
to know Microeconomics before we can do Macroeconomics. That makes
Macro a bit more challenging, but ultimately much more fun than
The phenomena we study include differences in wealth across
countries, why some economies grow and develop so much faster than
others, how many new jobs are created, why some jobs disappear, and
how the price level changes.
The phenomena we study emerge from interactions of
consumers, firms and various governmental agencies. Since government
is one player/decision maker in the economy, it might be able to
influence economic outcomes, both in a positive or an adverse way.
This class will stress how government policy influences economic
outcomes. This class will also provide criteria, which will enable
us to study whether particular government policies are desirable.
This course will attempt to merge analytical/theoretical
tools of modern macroeconomics with analysis of macroeconomic data.
It is not the purpose of this class to help you understand what is
going in Bernanke's mind (I wish I knew). Nor is it the purpose of
this class to help you get rich (quick). It is also not the purpose
of this class to help you understand the Wall Street Journal. The
purpose of this class is to give you tools that you can use to
understand important economic phenomena.
Grading: Grades will be based on three exams (including the final
exam), homework, a small project, a larger project and class
participation. There will be around five homework sets. You have at
least one week for each one of the homework sets. The weight on the
homework sets is 15% in the computation of the course grade. The
weights on the in-class exams (mid-term) is 15% each, the weight on
the final exam is 30%.
The small project is called News, Weather and Sports. Each
one of you will report on important breaking Macroeconomic News.
(Here is your chance to impersonate your favorite news caster) In
your economic news report include What? Where? When? How? WHY?,
include a brief interpretation of the news, and if there is a
controversy surrounding the news, include a brief description of the
controversy. Include a brief (one sentence) weather forecast for the
place. Finally, tell us about a sports event that includes the IU
Hoosiers, either an outcome of a recent competition or an upcoming
game (in one sentence or two). Of course, I want you to concentrate
on the Macroeconomic News. The entire report should not exceed 4
minutes. I will hand out a schedule for News, Weather and Sports
soon. The weight on the small project is 5%.
The large project is your group project in which you are
asked to be a Macroeconomic sleuth. Groups will consist of about 3
students. I will ask you to collect data that might be puzzling, and
solve the puzzle by using models and knowledge from class, or find
data to confirm or refute a hypothesis. I will give you precise
instructions for the group assignments. The large project is worth
20% of the course grade.