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ECON 206 provides a basic understanding of the theoretical foundations of macroeconomics at the intermediate level. The course develops a coherent framework to understand the determination of macroeconomic variables such as national output, unemployment, inflation, interest rates, trade deficits, and exchange rates. This theoretical framework is used to interpret macroeconomic data and to analyze macroeconomic policy. The objective of this course is to help students think independently and critically about macroeconomic policies.
The focus of the course is understanding the aggregate behaviour of people, businesses, and government. This includes understanding fluctuations of aggregate activity, the growth of a country’s standard of living, and how government choices affect these things. First, we review what we mean by aggregate activity and how we measure it. Next we look at why people in a country choose to save or borrow and businesses choose to invest, and what this means for people’s welfare and wealth, a country’s exports and capital flows, and the values of interest and exchange rates. This leads on to the monetary system and inflation, and how it affects us. Both credit and money are important parts of a country’s financial system, so we study this in more detail to learn how it influences what we do. Ultimately we care about having a job and a decent income, wish to avoid unemployment, and want to know how and why the economy fluctuates and what it means for people. This what we study in the topic of aggregate demand and supply. This naturally flows through to what the government can do about the economy and the important questions of can it stop or mitigate the effects of the fluctuations? Finally, we look at the topic of economic growth, since ultimately it is the topic of how we can lastingly improve our standard of living.
By the end of the course students will be able to:1. demonstrate an understanding of how aggregate economic variables are determined by the choices made by households, businesses, and government.2. explain what happens to aggregate economic behaviour when there is a change in the underlying behaviour of a part of country, or from a change in another country.3. analyse the effects of policy and other changes on aggregate economic outcomes that matter to people.
ECON104 and ECON105
ECON201
Philip Gunby
Mankiw, N. Gregory; Macroeconomics ; 7th ed; Worth Publishers, 2009 (The 8th edition will be released shortly and it is the 8th edition which will be the course text).
Course Outline
Domestic fee $775.00
International fee $3,188.00
* All fees are inclusive of NZ GST or any equivalent overseas tax, and do not include any programme level discount or additional course-related expenses.
For further information see Department of Economics and Finance .