ADVANCED MACROECONOMICS

(MACRO - 6)

prof. Nissan Liviatan

Preliminary Program:

1. The Government Budget and Inflation- The inflation tax model. Bruno/ M and S.Fischer, (1990), "Seigniorage, Operating Rules and the High Inflation Trap", Quarterly Journal of Economics.,353-74. T.J.Sargent,(1986), Rational Expectations and Inflation, Harper and Row, Publishers. Chap.2. Phelps,E.S., (1973)/"Inflation in the theory of public finance", Swedish Journal of Economics, 68-82.

2. Budget deficits and tight money.

A.Drazen, (1984) ,"Tight Money and Inflation: Further Results", Journal of Monetary Economics,15, 113-120.

N.Liviatan, (1984), "Tight Money and Inflation", Journal of Monetary Economics, 13, 5-15.

Sargent,G. and N.Wallace, (1981), "Some unpleasant monetarist arithmetic". Federal Reserve Bank of Minneapolis, Quarterly Review,5, 5-17.

3. Dynamic Inconsistency and the Inflation Bias. Blanchard, and S.Fischer, (1989), Lectures in Macroeconomics, MIT Press. 592-614.

Cukierman,A. (1992), Central Bank Strategy, Credibility and Independence, MIT Press. 15-97.

Cukierman,A. and N.Liviatan, (1992), "The Dynamics of Optimal Gradual Stabilization", The World Bank Economic Review, 6, 439-458.

4. Inflation targeting.

Svensson,L.,(1996),"Inflation Forecast Targeting: Implementing and Monitoring Inflation Targets", NBER.

Bernanke,B.S.and M.Woodford, (1997), "Inflation Forecasts and Monetary Policy", Journal of Money, Credit and Banking, 29,653-684.

5. Multiple equilibria.

Calvo,G.A.,(1992), "Are High Interest Rates Effective for Stopping High Inflation? Some Skeptical Notes", The World Bank Economic Review, 6, 55-69.

6. Financial crises.

Diamond,D. and P.Dybvig/ (1983), "Bank Runs, Deposit Insurance and Financial Crises", Journal of Political Economy, 91, 401-419. Chang,R. and A.Velasco, (1999), "Financial Crises in Emerging Markets: A Canonical Model", NBER WP6606.

7. Balance of payments crises.

Krugman/P. (1979), "A Model of Balance of Payments Crises", Journal of Money, Credit and Banking,11, 311-325.

Obstfeld,M. (1996), "Models of Currency Crises with Self-Fulfilling Features", European Economic Review,40, 1037-1047.

Sachs,J., Tornell/A. and A.Velasco, (1996), "The Mexican Peso Crisis: Sudden Death or Death Foretold?", Journal of International Economics, 265-283.

Jeanne,0., (1997), "Are Currency Crises Self-Fulfilling? A Test", Journal of International Economics, 43, 263-286.

Flood, R., P.Garber and N.Marion, (1998) /"Perspectives on Recent Currency Crisis Literature", IMF WP/98/130.

Milesi-Ferretti/G.M. and A. Razin, (1995)/ "Current Account Sustainability", mimeo.

8. Other Issues in Open Economy Macroeconomics.

a. Fixed exchange rates, the offset coefficient and sterilization.

Dornbusch,R. (1980), Open Economy Macroeconomics, Basic Books, Inc. 186-192.

------------ (1988), "Exchange Risk and Macroeconomics of Exchange Rate Determination", in the author's Exchange Rates and Inflation, 125-151.

Calvo.G.A., (1991), "The Perils of Sterilization"/ IMF Staff Papers, 38, 921-926.

b. Flexible Exchange Rates and Overshooting.

Dornbusch,R. Open Economy Macroeconomics, Ch.11.

c. Exchange rate bands.

Krugman,P.R./(1991), "Target Zones and Exchange Rate Dynamics", Quarterly Journal of Economics, 116, 669-82.

Svensson,L.E.0.,(1992), "An Interpretation of Recent Research on Exchange Rate Zones", Journal of Economic Perspectives, 119-144.

Courses 2001/02

Courses offered
in 2000/01:

Advanced Topics in Econometrics

Applied Econometrics

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