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ECON376 Macroeconomic Theory

A paper aimed at preparing Honours students for independent study in macroeconomics. The main topics covered will be the AS/AD paradigm, new classical macroeconomics, monetary and fiscal theory and policy.

The main topics covered will be the IS/LM paradigm, microfoundations of macroeconomics, and monetary and fiscal policy in theory and practice. This paper follows a modern approach to macroeconomic theory based on microeconomic foundations. In particular, we analyse the consumption, saving and labour-supply decisions of households and the employment and investment decisions of firms. We also examine aspects of aggregate behaviour depicted in dynamic general equilibrium models of an economy. Theories of the business cycle, monetary and fiscal policy, financial crises, unemployment and international macroeconomics will be discussed.

Some of the questions we will ask are: What are the effects of monetary and fiscal policy? Should we be concerned about government debt levels? How does quantitative easing work? How does a bank run work and how can we increase financial stability?

Paper title Macroeconomic Theory
Paper code ECON376
Subject Economics
EFTS 0.1500
Points 18 points
Teaching period First Semester
Domestic Tuition Fees (NZD) $846.30
International Tuition Fees (NZD) $4,073.10

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ECON 202 and (ECON 270 or ECON 271)
Schedule C
Arts and Music, Commerce, Science
Teaching staff

Dennis Wesselbaum

Charles I. Jones Macroeconomic, W. W. Norton & Company, Inc. (3rd and 2nd Edition are both fine)

Frederic S. Mishkin The Economics of Money, Banking, and Financial Markets, Addison-Wesley Series in Economics, 7th Edition
Graduate Attributes Emphasised
Global perspective, Scholarship, Communication, Critical thinking, Research, Self-motivation.
View more information about Otago's graduate attributes.
Learning Outcomes
After completing the paper, the successful student will be able to:
  • Describe the process of macroeconomics research and explain the role of theoretical models in that process;
  • Construct and solve macroeconomic models based on microeconomics fundamentals;
  • Understand and analyse the underlying economic forces that drive unemployment, growth, inflation, savings, short-run fluctuations in consumption and investment, stability of the financial system and international issues;
  • Use academic writing to summarise and critique the current macroeconomic literature and economic events.

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First Semester

Teaching method
This paper is taught On Campus
Learning management system


Stream Days Times Weeks
L1 Monday 15:00-15:50 9-16, 18-22
Tuesday 12:00-12:50 9-16, 18-22


Stream Days Times Weeks
T1 Wednesday 12:00-12:50 9-16, 18-22