Introduction to Macroeconomics

Description

Some university courses you take are simply taken to “get the points”. If you work hard in ECON105 (Principles of Macroeconomics) then you will most likely “get the points” but I sincerely hope you will get a great deal more than that. The discipline of economics has a lot to offer you regardless of whether or not you continue in the subject – though I very much hope you will.

ECON105 will challenge your views of how you see the world. You will see and hear the news and economic and political commentators in a different way than you used to. Maybe you will even pay attention to the news and to economic and political commentators for the very first time because you have discovered there is some interesting stuff there! At the end of this course you will be able to
1. demonstrate an understanding of the contemporary world economy and how it differs from past
periods of time.
2. discuss the measurement of economic variables and how rises and falls in these variables impact on people and the UN SDGs (https://sdgs.un.org/goals).
3. explain the reasons for and consequences of Reserve Bank actions.
4. identify and explain changes in policy settings and analyse the effects of policy changes on
economic outcomes that matter to people.

Like any other discipline there will be some terms and definitions that you will need to know in order to put some framework on your thinking. And, yes, there is some theory to learn. In any discipline worth studying at tertiary level there always is. Sometimes we will have to grind our way through a bit of this theory but it will be worth it because the theories we develop will help shed light on some important real world
questions. Questions like:
• Why does the NZ economy look the way it does today?
• What is so bad about inflation?
• Why do we care what the Governor of the Reserve Bank says?
• Which is better – a high or low exchange rate?
• Governments, tax, spending and welfare – why do we argue about these?
• Why is economic growth so important?
• Is the narrative around globalisation changing?
• Is society becoming more or less equal and does it matter?
• What is the best way to help the world’s poorest?

To put these questions into some context we will also spend a bit of time looking at what the NZ and global economy looks like – where it has come from; the ideas that have influenced our economic history; our growth and inflation record compared to other countries; and recent changes and important pieces of legislation.

I will use stories, videos, news items and other narratives where possible to connect all these things together and make the theory relevant to what you see around you (assuming that you look!). Facts and statistics can also paint a very interesting picture and I will make use of these as well. I will try to engage and involve you in the lecture setting but obviously this is more difficult with a large number of students compared to 20. It is also more difficult for students as firstly not all of you can have your say and secondly some of you would rather die than have to say anything in front of so many others anyway. Tutorials provide a better environment to ask questions, participate in discussions and acquire some personal help. Tutorial questions will give you practice with the sort of thing which can be tested and from time to time will get you to think about issues raised in the course. Make use of tutorials.

From time to time we might need to use a bit of algebra to get to where we want to go. However this is not a course that uses a lot of mathematics and there is no cause for alarm amongst math-phobics. We will however, use quite a lot of graphs because in economics, graphs can be a very powerful tool for understanding the real world and the behaviour of people.

You may not agree with everything you hear or read in ECON105 and you should not expect to. Tertiary education does not simply exist to give you a meal ticket in the form of a degree (though of course that’s a desirable outcome!) but it also exists to make you a better thinker. You will only be a better thinker by having to think. You should feel free to question, debate and challenge. Economics is not a set of truths to be memorised but an active and alive conversation and a lens through which we can understand the world. By engaging each other in the subject matter, you and I will both become better thinkers. Even if, by the end, you don’t believe you have any better answers you should at least be able to ask better questions!

ECON105 serves as a pre-requisite for ECON206 (Intermediate Macroeconomics) which is a compulsory requirement for students majoring in economics. Therefore it is important that ECON105 is good preparation for students who intend to continue on with their study of economics. I cannot guarantee that by passing ECON105 you will also pass ECON206 but I will prepare you as best as I can, providing you do your bit. About now, some of you may be already asking “will this be in the exam?” Well not everything we cover will be in the test or the exam and you should not expect it to be. If we only ever spent time looking at material that could be examined via tests and exams within the context of a large first year course then it would be a very boring course. You would probably find it very hard to get enthused about studying at all let alone actually learning something useful if we did it that way. As you can imagine, other forms of assessment such as projects, essays or presentations bring their own constraints in a course of this size. A word to the wise – a peek at previous tests and exams will give you a good idea of what you can expect when it comes to the test and exam. However, you should also be aware that the course does evolve over time so while some questions appear with remarkable regularity, others drop out.

Macroeconomics is one of the most interesting subjects around (microeconomics of course being the other!) With work on your part and a commitment on my part to convincing you that macroeconomics is not only interesting but also relevant I am sure you will get a lot more than just 15 points out of this course.