MACROECONOMIC THEORY II

Paper Code: 
ECO 222
Credits: 
4
Contact Hours: 
60.00
Max. Marks: 
100.00
Objective: 

To acquaint the students about the importance of various issues related to macro economics.

12.00
Unit I: 
Post Keynesian developments in macroeconomics

The IS LM model; graphic and algebraic derivation of IS and LM curves; factors that affect the equilibrium income and interest rate; relative effectiveness of monetary and fiscal policies.

12.00
Unit II: 
Neo Classical Macroeconomics

The Keynesian Theory and the New Classical (Lucas) critique; Rational Expectations Model and its policy implications; A critical evaluation of Rational Expectations Model.

12.00
Unit III: 
Open economy Macroeconomics

Mundell-Flemming model of a small open economy with fixed exchange rate regime and flexible exchange rate regime (case of imperfect capital mobility and perfect capital mobility).

12.00
Unit IV: 
Business Cycles

Theories of Kaldor, Samuelson and Hicks; Goodwin’s model; Control of business cycles – relative efficacy of monetary and fiscal policies.

 

12.00
Unit V: 
Inflation and unemployment

Inflation –Unemployment trade off - The Phillips Curve; The natural rate of unemployment hypothesis and Adaptive expectation hypothesis;

Relationship between short run and long run Phillips’ Curve; Sacrifice Ratio and Policy of disinflation.

Essential Readings: 
  1. Richard,T.Froyen, Macro Economics: Theories and Policies, Pearson Education, 2003
  2. Branson, W. A., Macroeconomic theory and policy, (3rd edition), Harper and Row, New York
  3. Gregory Mankiw, Macroeconomics, CBS Publishers, New Delhi,1992.
  4. Eric Pentacost, Macro Economics: An Open Economy Approach, Macmillan, Indian Edition, New Delhi, 2000.
  5. P.Edgemond, Macreconomics, PHI, New Delhi, 1999.
  6. Robert J Gorden, Macroeconomics, Harper Collins, 1994.
  7. M.G.Mueller, Readings in Macroeconomics, II Edn, Surjeet Publications, 1978.
  8. A.H.Hansen, A Guide to Keynes, McGrawHill, London, 1953.
  9. Prabhat Patnaik, Macro Economics, Oxford University Press, Chapter by AmitavaKrishna Dutt(1995), New Delhi, 1995.
  10. Ahuja. H. L., Macroeconomics – Theory and Policy, S. Chand & Company Ltd.
Academic Session: 
2017-18
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