. © 1999-2008
Douglas A.Ruby

The Digital Economist

Intermediate Macroeconomic Theory

Macroeconomics is the study of economic behavior in the aggregate. This area of economics addresses topics related to the employment of resources, price stability, economic growth, and interactions among nations in the world economy.

Textbook Recommendations:
Abel, Andrew, and Ben Bernanke, Macroeconomics, 6th Ed. 2008.

Blanchard, Oliver, Macroeconomics, 5th Ed. 2009.

Farmer, Macroeconomic Theory,, 1st edition, 2001.

Hall, Robert E., and John B. Taylor, Macroeconomics: Theory, Performance, and Policy, 5th edition, 1996.

Mankiw, N. Gregory, Macroeconomics, 5th Ed.,2002.

Ruby, Douglas A. , Intermediate Macroeconomic Theory,1st ed., 2003, Digital Authoring Resources.

•  A Schematic Model
•  Economic Data (1959-2000)
•  Price Index Calculator
•  The Spending Multiplier
•  Macroeconomic Models
•  Macroeconomics Glossary

These worksheets are in .PDF format and require Adobe's Acrobat Reader.
•  Worksheet #1 -- Economic Data
•  Worksheet #2 -- Productivity and Output
•  Worksheet #3 -- The Flow of Funds
•  Worksheet #4 -- Capital Accumulation
•  Worksheet #5 -- Income Determination
•  Worksheet #6 -- Demand-Side Equilibrium
•  Worksheet #7 -- Present Value Calculations
•  Worksheet #8 -- Money Markets

I. An Overview of Macroeconomics

• An Introduction to Macroeconomics.
• Economics as a Social Science
• The Importance of Relative Prices
• Optimizing Behavior
II. The Determinants of Economic Growth

• The Creation of Wealth
• The Accumulation of Capital and Economic Growth
• Investment and the Optimal Capital Stock
III. The Measurement of Macroeconomic Variables
• National Income Accounting
• Business Cycles
• Unemployment
• The Balance of Payments
• Exchange Rates
• Measures of Inflation.
• Term Structure of Interest Rates.
IV. Aggregate Demand and the Goods Market

Goods Market Equilibrium
• The components of Aggregate Demand
• Savings, Investment and Interest Rates
• Aggregate Expenditure, the Multiplier process and Income Determination.
Theories of the consumption function:
• Microfoundations: The Two-Period model of Consumption,
• The Permanent Income Hypothesis (PIH)
• Other forward looking models (the LCH)
Theories of investment behavior:
• The Profit Maximizing Approach
• The Accelerator model
V. Aggregate Demand and Financial Markets
Financial Markets and Assets
• Financial Markets -- Asset Prices and Yields
• The Federal Reserve System (external WWW link)
Money and (Short Term) Interest Rates:
• Money as a Financial Asset
• The Portfolio Theoretic Approach
• The Money Supply Process
• The Quantity Equation
VI. A closer look at the Supply Side and Potential Output

The labor market: employment and wage determination.
• Microfoundations: Labor/Leisure decisions
Models of inflation and inflationary expectations.
• Price Level Determination and Inflation
• The Adaptive Expectations Model
• The Rational Expectations Model
VII. Macroeconomic Policy

• Demand-Side & Supply-Side Policies