This course teaches the principles of macroeconomic policy in an international setting. The course focuses on developing a framework for understanding the forces that determine output, employment, inflation, interest rates, exchange rates, the trade deficit, and other key macroeconomic variables. This framework is used to evaluate different macroeconomic policies in the context of different national economic environments.
By the end of the course, students will understand: (1) How an open macroeconomy functions, and why there are business cycles. (2) The role of the Federal Reserve and other central banks, and the challenges they face in designing and implementing good monetary policy. (3) The impacts of fiscal policy choices such as government budget deficits and large levels of public debt.