44474 - Advanced Monetary Economics

Learning outcomes

Course's objective is to provide an adequate understanding of the monetary policy's analysis and implementation in developed economies. A good knowledge of English language is required.

Before the beginning of the course, students should make sure to be sufficiently familiar with:

1) The role of money in the economy

2) Very basic microfoundations of macroeconomic models and the required mathematical tools.

3) Basic macroeconomics (relationship  between macro variables, differences between short-run and long-run policies, aggregate demand policy

At the end of the course, students should be familiar with the following macro-topics:

1) Modelling of theoretical frameworks for monetary policy analysis in closed economy.

2) Monetary policy rules and procedures in last generation macroeconomic models.

3) Monetary policy operating procedures, particularly referring to European Central Bank.

 

Course contents

1. The basic AS-AD model

2. Advanced models for monetary policy analysis

3. The Barro-Gordon model and the time-inconsistency problem

4. Inflation targeting and monetary policy rules

5. Monetary policy and financial markets

6. Monetary policy and the term structure

7. Monetary policy's strategies and operating procedures

8. Monetary policy's implementation in the Euro-area

Readings/Bibliography

Main reference books are:

Walsh, C. (2003), "Monetary Policy and Theory" - second edition - MIT Press

Bagliano, F.C, Marotta, G., (1999)"Economia Monetaria" - Il Mulino

Teaching methods

The course consists of ten lectures, three hours each (15 min. break). There is the possibilty (to be discussed during the course) to schedule individual/group presentations to be considered as part of the final evaluation.

Assessment methods

Final exams consists of a written examination (four questions out of six to be answered) where students will have to develop a brief topic together with some formal analysis.

Teaching tools

Most of teaching material consists of hands-out and journal articles distributed during classes.

A few examples:

The implementation of monetary policy in the euro-area"  November 2008  http://www.ecb.int/pub/pdf/other/gendoc2008en.pdf?8b7c2e06c652ff5b9141e4de5fef7ea4

Woodford, M. Bernanke B. (1997), "Inflation Forecasts and Monetary Policy" NBER Working paper 6157

Svenson, L. (2002), "What is Wrong with Taylor Rules? Using Judgement in Monetary Policy Through Targeting Rules" NBER Working paper 9421

Office hours

See the website of Luigi Marattin