Working Papers:
Income Inequality
Health Insurance
Ridge Regression
For Students:
DEVELOPMENT
730
TRADE
76.3 and 727
MICRO
20.1
micro
lecture notes
MACRO 10.1
macro
lecture notes
Economic Links


Software Corner

Why you should use GNU/Linux
The Alternative to Anarchy

Memory Usage:
MS Windows vs. GNU/Linux

Getting Started with R


EMAIL
ME!
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Macro 10.1 at Brooklyn College
[not currently teaching]
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Message Board
I am not teaching this course right now, but I have left links to my notes and other course materials
below. Hopefully, you or someone else will find them useful. A word of caution however: Like everyone
else, I make mistakes. I am aware of most of the errors, but I simply
haven't had time to fix them.
...
message board with all old messages -- click
HERE
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Links and Files
| NOTE: To view a PDF file you need Sumatra PDF Viewer. If you do not already have it, please click HERE to obtain a FREE copy. |
Class Schedule
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Since the custom textbook contains material from four different
textbooks, I'll use the following abbreviations in designating the textbook
chapter that corresponds to each lecture:
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FB -- Frank/Bernanke's Principles of Macroeconomics
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FB Micro -- Frank/Bernanke's Principles of Microeconomics
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VDB -- Van den Berg's Economic Growth and Development
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DO -- DeLong/Olney's Macroeconomics
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Part One -- Introduction to Macroeconomics
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Lecture 1: Introduction and Math Review
read: FB chap. 1 and appendix and do: Homeworks
#1A and #1B
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Lecture 2: Production, Opportunity Cost and Relative Price
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How does opportunity cost give rise to comparative advantage, the basis
of international trade?
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How are gains from trade determined by opportunity cost and relative price?
read: FB chap. 2 and do: Homework #2
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Lecture 3: The Production Process
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What marginal condition determines a profit-maximizing firm's optimal level
of output?
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How does a change in the wage rate affect a cost-minimizing firm's employment
of capital and labor?
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How do firms' short-run costs differ from their long-run costs?
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What are increasing, constant and decreasing returns to scale and how do
they affect optimal firm size and the number of firms in an industry in
the long run?
read: FB Micro chaps. 6 and 13 and do: Homework #1C
and #3
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Lecture 4: the Distribution and Allocation of National Income
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What is Gross Domestic Product?
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Why should the Income and Expenditure Approaches to calculating GDP both
yield the same sum?
read: FB chaps. 4 and 5 and do: Homework #1D
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Part Two -- Economic Growth
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Lecture 5: Economic Growth: the Solow Model
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How do saving and growth of the labor force affect the long-run level of
output per worker?
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How does technological progress affect the growth rate of the long-run
level of output per worker?
read: FB chap. 7 and VDB chap. 4 and do: Homework
#5
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Lecture 6: Economic Growth: Human Capital
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What is human capital?
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How does investment human capital affect the long-run level of output per
worker?
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What factors affect the growth rate of technological progress?
read: VDB chaps. 5 and 10 and do: Homework #6
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Lecture 7: Economic Growth: Transition Dynamics
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How do government budget deficits affect the national saving rate?
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If a high saving rate leads to a high steady state level of output per
worker, then why is saving so unpopular?
read: FB chap. 9 and do: Homework #7
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Part Three -- Unemployment and Inflation in the Long Run
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Lecture 8: Supply, Demand and Equilibrium
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What role do prices play in moving markets toward an equilibrium in response
to a surplus/shortage?
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What events cause the demand curve to shift? What events cause the supply
curve to shift?
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How do the equilibrium price and equilibrium quantity supplied/demanded
respond to a shift of the supply curve? How do they respond to a shift
of the demand curve?
read: FB chap. 3 and do: Homework #8
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Lecture 9: Unemployment in the Long Run
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How is the unemployment rate measured?
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Why are there always some people who are unemployed?
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What is the discouraged worker effect? and How does it cause the unemployment
rate to present a misleading measure of the true fraction of people who
are unemployed?
read: FB chaps. 5 and 8 and FB Micro chap. 13 and
do: Homework #9
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Lecture 10: Money and Inflation in the Long Run
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How does the Federal Reserve control the money supply?
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How does the Federal Reserve affect interest rates in the economy?
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What factors affect the optimal quantity of money that people would like
to hold?
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What is the difference between the nominal interest rate and the real interest
rate?
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What is inflation? and What causes inflation in the long run?
read: FB chaps. 6 and 10 and do: Homework #10
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Part Four -- Economic Fluctuations
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Lecture 11: Economic Fluctuations: the Goods Market
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Under what conditions would a difference between planned aggregate expenditure
and aggregate output occur in the short run?
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How do the levels of taxation and government spending affect the equilibrium
quantity of aggregate output produced in the short run?
read: FB chaps. 12 and 13 and appendices and do: Homework
#11
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Lecture 12: Economic Fluctuations: the Goods and Money Markets
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Under what conditions can the real interest rate deviate from its long-run
level in the short run?
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How do changes in the money supply affect equilibrium aggregate output
in the short run?
read: FB chap. 14 and appendix and do: Homework #12
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Lecture 13: Output and Inflation in the Short Run
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How does the aggregate demand curve fundamentally differ from a market
supply curve?
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How do cost shocks increase the price level and reduce aggregate output
(causing recession)?
read: FB chap. 15 and do: Homework #13
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Lecture 14: the Short-Run Tradeoff between Inflation and Unemployment
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Under what conditions can contraction of the money supply increase unemployment
in the short run?
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Under what conditions would contraction of the money supply have no effect
on unemployment in the short run?
read: DO chap. 12 and do: Homework #14
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Final Exam
dates and times (pick one):
| Sat. |
19 May |
9:00 to 11:00 am |
in Whitehead 206 |
| Tues. |
22 May |
6:00 to 8:00 pm |
in Whitehead 408 |
| Thurs. |
24 May |
8:30 to 10:30 pm |
in Whitehead 408 |
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Course Requirements
Your final grade will be determined by a weighted average of a mid-term
exam (35 percent), a final exam (45 percent) and the quality of your class
participation (20 percent).
The exams will consist of a section of identifications -- in which you
will write brief definitions and describe the relevance of key concepts,
theories, etc. -- and a section of essays.
Homework will be assigned and the solutions will be reviewed in class,
but I will not collect them and I will not grade them. If you read the
Lecture Notes and the textbook do the homework regularly, you will develop
a good understanding of the course material and you will score higher on
the exams. If you only read the Lecture Notes and do the homework the night
before the exam, don't expect to pass.
Finally, in evaluating the quality of your class participation, I will
consider:
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your attitude towards the course material,
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how well you demonstrate an understanding of the required readings and
homework assignments and
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how often you ask intelligent questions in class.
Saying "I don't understand" and explaining what you don't understand and
why you don't understand it is one of the most intelligent things you can
do. It demonstrates curiosity and interest in the course material.
By contrast, sitting in silence when you don't understand is one of
the dumbest things you can do.
Course Textbook
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Doviak, Eric. Lecture Notes on Economic Growth and Economic Fluctuations.
-- click HERE
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a custom textbook that I designed with the assistance of McGraw-Hill (available
in the bookstore)
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Pearce, David W. (ed.) The MIT Dictionary of Modern Economics. ISBN:
0-262-66078-4 (???)
My Lecture Notes contain a lot of information, but they are not
a substitute for a textbook. You need a textbook for depth. I recommend
the custom textbook because it covers the material in the Lecture Notes
in far greater depth than my Lecture Notes and more intuitively
than other textbooks do.
Why Study Macroeconomics?
Macroeconomics is the study of how economies perform over short and
long periods of time. This is an important discipline because the performance
of an economy is directly tied to living standards. After all, the more
our economy produces, the more we can consume and the higher is our standard
of living.
Similarly, if an economy is producing less output this year than it
did last year, our consumption in this year will likely be lower than it
was last year and the number of unemployed workers will likely be higher
than it was last year.
Macroeconomics also examines the impact that government policy can
have on the rate of unemployment, the level of output that our economy
produces and the prices that we pay for the goods and services that we
consume.
Of fundamental importance is the time frame in which we are examining
the economy's performance. Many of the government policies which boost
our living standards over short periods of time are downright harmful to
our living standards over longer periods of time.
This course places a great emphasis on the difference between the short-run
and long-run performance of the economy and stresses the tradeoffs that
government policymakers face. For example, raising taxes and cutting government
spending is political suicide, but one day we will have to pay off the
government debt and that will require either tax hikes or cuts in government
spending.
Studying such tradeoffs will help you understand the nature of tradeoffs
that you face in everyday life.
For example, in the short run, spending time studying economics prevents
you from spending time with family and friends. In the long run, time spent
studying economics will enable you to make more rational decisions, which
will increase your productivity at the office and -- hopefully -- enable
you to get a raise.
Objectives of this Course
This course has two sets of objectives: practical and academic. The
practical objectives aim to teach you how to apply mathematics and economics
in daily life. The academic objectives (which are listed with the class
schedule) aim to teach you basic macroeconomics.
The practical objectives consist of:
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enabling you to interpret graphs and equations, both mathematically and
intuitively,
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developing your logical thinking skills,
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teaching you how independent variables affect dependent variables and
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helping you apply the concept of opportunity cost, marginalism and efficient
markets in everyday life.
Knowledge of algebra is a prerequisite. I will conduct a review
of basic algebra, but it's meant to be a review, not an opportunity
to learn it for the first time. If you are unable to grasp the concepts
I cover during the math review, I will advise you to drop the course --
not because I'm cruel, but rather because I don't want you to suffer for
four months and fail.
BlackBoard
I won't use BlackBoard much in this course, but there may be times
when I would like you to read materials other than the Lecture Notes
or the textbook. In such an event, I'll post the articles to BlackBoard.
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So go to: http://www.cuny.edu
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At the bottom of the orange column on the left-hand side is a "Log-in"
link. Click there.
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On the next page ... If you already have a Portal Login, just enter your
username and password.
If you don't have a Portal Login yet, then click the "Register Now!"
link and the system will verify your status by using your last name, Social
Security Number, date of birth, etc.
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After you have logged in, you'll see a "My Page" window with a whole bunch
of bubbles. In the bubble in the upper left ("SSO Applications for Faculty
and Staff"), there is a link to "BlackBoard." Click on that link.
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On the next page, you'll be asked to choose your CUNY school. Select the
Brooklyn College link and you'll be taken to another screen with a whole
bunch of bubbles.
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In the "My Courses" bubble, you'll see a link to the Macro course. Click
on that link and you'll finally be in BlackBoard.
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All of the files for the course are in the "Course Documents" page, which
you can get to by clicking on the "Course Documents" link in the green
column on the left-hand side.
Attendance Policy
Come and go as you please, but keep in mind that the lectures are an
important part of the course. If you're not here, it's going to be a lot
harder to understand the course material. Poor attendance will also adversely
affect my evaluation of your class participation.
For example, if you never come to a single class, but somehow manage
to ace both exams (which is highly unlikely), your final grade would be
a B-plus - that's 80 percent of an A (4.0).
Exam Make-Up Policy
Any student who is either unable to attend class on the day of the
exam or simply doesn't feel like coming to class on the day of the exam,
doesn't have to come. There's no need to contact me or explain the reason
for your absence. Just don't come.
If you miss the mid-term exam, you will be expected to submit a take-home
examination within two weeks of the class immediately following the mid-term
exam. No exceptions.
If you miss the final exam, you will have to make it up during departmental
exams next semester.
In deciding whether or not to come to class on the day of the exam,
keep in mind that I see absolutely no reason why the difficulty of the
take-home exam or the departmental exam should be comparable to that of
the in-class exam.
If I were in your shoes, I would come to class on the day of the exam.
Instant Replay Rule
If you do not do well on an exam and would like to improve your grade
by doing the make-up exam, I'll look very favorably upon your efforts.
For those of you who would like to improve your grade by haggling with
me over points, we'll play by the "Instant Replay Rule." If your complaint
has merit, I'll fix your grade. If your complaint does not have merit,
it will cost you one whole letter grade.
Email at your Own Risk
Any take-home assignment (such as a make-up exam) should be submitted
to me during regular class hours. If you cannot attend class that day,
ask a friend to submit it for you.
I will also accept assignments submitted to me by email or left in
my box at the Economics Department Office (Whitehead 217).
Keep in mind however that email does not always work perfectly. There
is a low (but not insignificant) probability that the email will not be
delivered to me. There is also a low (but not insignificant) probability
that an assignment left in my box will disappear.
I will not be held accountable for vanishing emails. Nor will I be
held accountable for assignments devoured by the mailbox gremlin. You assume
ALL of the risk associated with email and/or mailbox submissions. If I
don't receive it, it's your problem, not mine.
Policy on Cheating
Don't even think about it. I will catch you and I will pursue the harshest
penalty that the college allows.
What you should think about is the reputation of your school. If Brooklyn
College were to develop a reputation for tolerance of cheating, then potential
employers would consider completion of a degree at Brooklyn College to
be a trivial accomplishment and your investment of time, money and energy
at this school will have been squandered.
Use of notes during an in-class exam is cheating. Don't do it. Copying
material from a website on a take-home exam is cheating. Don't do it.
If you think I won't know if you copied material from a website on
a take-home exam, you're wrong.
What to Expect
I have an easy-going attitude, but don't expect an easy A. I
work hard and I expect the same from you.
I'll give you all the help you need, but don't expect me to spoon-feed
you the answers. This is college. Come prepared to ask me questions. Don't
waste my time.
I don't see things in black and white. I am incapable of answering
a question with a simple "yes" or "no." I look for the complexity in an
issue and seek to understand it.
If you get impatient with someone who takes their time to answer a
question or goes into too much detail, then I'm probably not the professor
for you.
On the other hand, if you want to learn how to analyze an issue and
come to a well-reasoned conclusion, then you're in the right place.
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