Credit hours
In-class work per week |
Practice per week |
Credits |
Duration |
Total |
6 |
2 |
8 |
10 weeks |
120 hours |
Instructor
Humberto Francisco Silva Spolador
Objective
The discipline aims to achieve two goals. The first is to examine long-term macroeconomic developments, that is, from the perspective of economic growth. The central question: why has Brazil been left behind in the international context? The performance of Brazil is compared to other countries, discussing the possible determinants of the evolution observed both from a theoretical point of view and in light of the available evidence. The roles of savings and capital accumulation, knowledge and technology, and efficiency and their effects on productivity and per capita income are examined. The second objective, focusing on the short and medium term, is to present a synthesis of the main developments in stabilization policies since the 1970s. The central question is: What causes economic cycles and what can be done to stabilize them? These are, on the one side, the so-called real business cycles, and, on the other, the so-called “neoclassical synthesis”, that is, theoretical developments based on the integration of the ideas of Keynes and the Classics, with an emphasis on the role of expectations and debates around the Phillips curve. This is followed by the incorporation of the theory of rational expectations and its implications in the various fields of macroeconomics, both in the new classical and in the new Keynesian schools. From this perspective, we discuss the effectiveness of stabilization policies in the face of demand and supply shocks, the choice of policies, the role of public debt and its sustainability.
Content
Part I. Long Term: economic growth 1. Long Term Growth: Brazil and other countries 2. Theories and Evidence: Importance of savings and capital a. “AK” Model 3. Theories and Evidence: Knowledge and efficiency of labor a.Solow model 4.Growth in Brazil: going beyond saving 5.Capital accumulation a.Savings, capital price, capacity utilization, productivity 6.Product growth (GDP) a.Capital accumulation, strength of labor, technology (total productivity) 7.Total Productivity Growth a.Technological progress, technical efficiency, scale effect, allocative effect 8.Growth and Interest Rates a.Endogenous savings: Ramsey Model 9.Real Business Cycles Model aThe approach of P. Romer Part II. Short-Term Business Cycles: The Search for Stability 1.Phillips Curve and Neoclassical Synthesis 2.Aggregate Supply with Expectations 3.Rational Expectations a.New Classical Model b.New Keynesian Model c.New Keynesian Phillips Curve 4.Evaluation of Macroeconomic Policies a. Anticipated and Unanticipated Shocks in Demand and Aggregate Supply b. Optimal Employment and Inflation Policy 5. Tax Policies and Debt Sustainability a. Seigniorage and Inflation Tax b. Inflation Bubble c. Ricardian Equivalence, Sustainability and Growth.
Bibliography
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