Office
Hours: MW 11:30 – 12:30; 2:30 – 3:30 pm …
and by appointment
Please communicate with me via your Rebelmail account,
by phone, or stop by my office.
Extensions of
macroeconomic analysis. Application of economic analysis to the study of macroeconomic
phenomena. Implications for inflation, unemployment, growth, and the
effectiveness of fiscal and monetary policy. Credits 3 Prerequisites: Admission
to a business major/junior standing, ECON 303 and MATH 124 or equivalent.
Course Objectives: In this course, we will apply and extend tools of economic analysis to
major events in modern economic history.
We will concentrate on the hyperinflations and global depression of the
interwar years and the subprime-triggered financial crisis and ongoing slump of
today. We will also touch upon the Golden Age, stagflation, and Great
Moderation intervening between the Great Depression of the 1930s and the Great
Recession of recent years. Upon
completion of this course you will be conversant with the history of
macro-instability and tools of analysis developed to understand instability
including: i) Minsky’s financial instability hypothesis; ii) the
Koo-Minsky-Fisher debt deflation hypothesis; iii) Friedman’s revised quantity
theory of money and narrative methodology; iv) the rational expectations
hypothesis, real business cycle theory and dynamic stochastic general
equilibrium modeling; v) asymmetric information and the behavioral roots of
financial crises; and vi) the roles of policy (and policy errors) in
stabilizing and exacerbating crises and slumps.
Course Design: This is primarily a lecture course with a considerable
amount of student participation. Since there
are extensive background readings on each of the topics covered, we will
exploit the division-of-labor: each student will be responsible for summarizing
and leading a brief discussion of selected readings on each major topic. Your brief written summaries, outlines, and
or powerpoint slides will be distributed to your fellow students before their scheduled presentations.
Supplementary Readings (available in soft-cover
editions)
Additional Readings on the Recent Crisis
Examinations and
Grading
A 100-point midterm exam and a 150-point comprehensive final exam will be given this semester. In addition, you will prepare four 25 point summaries of assigned background readings on i) the German hyperinflation and slump, 1919 – 1939; ii) the U.S. Great Depression, 1929-1933; iii) the stalled U.S. recovery, 1933-1939; and iv) the housing bubble, subprime-triggered financial crisis and ongoing Long Slump, 2004-present.
Grading:
Classroom
examination
~Oct. 12 (between Depression & Recovery) 100 points
4 background summaries
and presentations 100
points
December
12 Comprehensive Final examination 150 points
Maximum score 350 points
Approximate grade
distribution:
Average Score out of 350 points
Final Grade
90 percent Borderline A-
80 percent Borderline B-
70 percent Borderline C-
60 percent Borderline D-
Attendance and class
participation will very much affect your final grade.
Makeup Policy
Makeup exams may be arranged
at mutual convenience if you have a
compelling reason to miss a scheduled classroom exam. A makeup exam must be taken before the missed
exam is returned to the class. There
will be no makeup quizzes or final exam.
However, a student missing a class because of observance of a religious
holiday and students who represent UNLV at any official extracurricular
activity shall also have the opportunity to make up assignments. Such students must provide official written
notification no less than one week prior to the missed class(es).
Class Conduct
Your instructor and classmates deserve courtesy. If you must arrive late or leave early, do so quietly. Inform me beforehand if you must leave a class early. Smoking and eating in class are prohibited. Texting, talking to your neighbors, and reading newspapers and magazines in class is rude, disruptive, and unacceptable. While this probably need not be said, anyone found engaging in any act of academic dishonesty will be punished in accordance with UNLV policies.
Other Information
The
Disability Resource Center (DRC)
coordinates all academic accommodations for students with documented
disabilities. The DRC is the official office to review and house disability
documentation for students, and to provide them with an official Academic
Accommodation Plan to present to the faculty if an accommodation is warranted.
Faculty should not provide students accommodations without being in receipt of
this plan.
UNLV complies with the provisions set forth
in Section 504 of the Rehabilitation Act of 1973 and the Americans with
Disabilities Act of 1990, offering reasonable accommodations to qualified
students with documented disabilities. If you have a documented disability that
may require accommodations, you will need to contact the DRC for the
coordination of services. The DRC is located in the Student Services Complex
(SSC), Room 137, and the contact numbers are: VOICE (702) 895-0866, TTY (702)
895-0652, FAX (702) 895-0651. For
additional information, please visit:
<http://studentlife.unlv.edu/disability/>.
Course
Schedule
Dates
|
Topic, Reading |
|
Aug 29 Aug 31 Sep 5 ~Sep 7 – 26 |
Course
Organization/The course outline—an overview of crises -
Richard Koo, Balance Sheet Recession http://ineteconomics.org/richard-koo Stories of crises past -
Charles MacKay, Memoirs of
Extraordinary Popular Delusions and the Madness of Crowds. {internet
access} -
Peter Temin and Hans-Joachim Voth, 2004. Riding the South Sea Bubble. American Economic Review (December). -
Carmen Reinhardt and Kenneth Rogoff, This Time is Different. NBER W.P 13882 -
Charles Kindleberger, 1978. Manias,
Panics and Crashes. Labor Day Recess Hyperinflation, Slump and Collapse:
The Economic Trajectory of Weimar Germany -
Phillip Cagan, 1956. The Monetary Dynamics of Hyperinflation in Milton
Friedman, ed., Studies in the Quantity
Theory of Money. -
Thomas Sargent, 1982. The Ends of Four Big Inflations, in Robert Hall, ed., Inflation: Causes and Effects.
{internet access} -
Giusseppe Tullio, 1995. Inflation and Currency Depreciation in Germany,
1920-1923. Journal of Money, Credit and Banking (May). -
Steven Webb, 1984. The Supply of Money and Reichsbank Financing of Government
and Corporate Debt in Germany, 1919-1923. Journal
of Economic History (June). -
___________, 1985. Government Debt and Inflationary Expectations as Determinants
of the Money Supply in Germany, 1919-1923.
Journal of Money, Credit and Banking (November). -
___________, 1986. Fiscal News and Inflationary Expectations in Germany,
1919-1923. Journal of Economic History
(September). -
Peter Temin, 1971. The Beginning of the Depression in Germany, Economic History Review (May). -
Joan Robinson, 1938. Review of Costantino Bresciani-Turroni, The Economics of
Inflation, Economic Journal
(September). -
Richard Burdekin and Paul Burkett, 1992. Money, Credit and Wages in
Hyperinflation. Economic Inquiry
(July). -
Paul Burkett and Richard Burdekin, 1993. Real Wages and Distributional
Conflict in the German Hyperinflation. Australian
Economic Papers (June). -
Harold James, 1986. The German Slump. -
Knut Borchardt, 1991. Constraints and Room for Manoeuvre in the the Great
Depression of the Nineteen Thirties: Toward a Revision of the Received
Historical Picture, in Knut Borchardt, Perspectioves
on Modern German Economic History and Policy. -
__________and Albrecht Ritchl, 1992. Could Brüning Have Done It? European
Economic Review, 695-701. -
Jonas Fisher and Andreas Hornstein, 2001. The Role of Real Wages,
Productivity and Fiscal Policy in Germany’s Great Depression. Federal Reserve
Bank of Richmond W.P. 01-07 (also Review
of Economic Dynamics, 2002). -
Hans-Joachim Voth, 1995. Did High Wages or High Interest Bring Down the
Weimar Republic? Journal of Economic
History (December). |
Dates
|
Topic, Reading |
|
~Sep 28 - Oct 26 ~Oct 31 - Nov 7 ~Nov 9 - Dec 5 Dec 7 Dec 12 |
The Great Depression: The
Holy Grail of Macroeconomics -
Lionel Robbins, 1934. The Great
Depression. -
Milton Friedman and Anna Schwartz, 1963. The
Great Contraction. -
Charles Kindleberger, 1973. The World
in Depression, 1929 -1939. -
Barry Eichengreen, 1992. Golden
Fetters: The Gold Standard and the Great Depression, 1919 – 1939. -
Richard Koo, 2008. The Holy Grail of
Macroeconomics. -
Peter Temin, 1989. Lessons from the
Great Depression. -
__________, 1994. The Great Depression.
NBER Historical Paper No. 62. -
__________ and Barrie Wigmore, 1990. The End of One Big Deflation. Explorations in Economic History, 483
-502. -
__________, 2008. Real Business Cycle Views of the Great Depression and
Recent Events: A Review of Kehoe and Prescott, eds., Great Depressions of the Twentieth Century. Journal of Economic
Literature (September). -
Harold Cole and Lee Ohanian, 1999. The Great Depression in the United States
from a Neoclassical Perspective. FRBM
Quarterly Review (Winter). - __________, 2004. New Deal Policies and
the Persistence of the Great Depression: A General Equilibrium Analysis. Journal of Political Economy (August).
- Gauti Eggertsson, 2006.
Was the New Deal Contractionary? Federal Reserve Bank of New York Staff
Report No. 264. - __________, 2008. Great
Expectations and the End of the Depression. American Economic Review (September). - __________ and Benjamin
Pugsley, 2006. The Mistake of 1937. Monetary
and Economic Studies, Special
Edition (December). - Irving Fisher,1933.Debt
Deflation Theory of Great Depressions. Econometrica
(Oct) - Ben Bernanke, 1983.
Non-Monetary Effects of the Financial Crisis in the Propagation of the Great
Depression. American Economic Review
(June). - __________, 1994. The Macroeconomics
of the Great Depression. NBER W.P. 4814 - __________, 1993. World
on a Cross of Gold: A Review of Golden
Fetters. Journal of Monetary Economics, 251 – 267. - __________ and Mark
Gertler, 1989. Agency Costs, Net Worth and Business Fluctuations. American Economic Review (March). - __________ and Martin
Parkinson, 1989. Unemployment, Inflation and Wages in the American
Depression. American Economic Review
(May). - __________ and Harold
James, 1990. The Gold Standard, Deflation and the Financial Crisis in the
Great Depression. NBER W.P. 3488. - Barry Eichengreen and
Peter Temin, 1997. The Gold Standard and the Great Depression. NBER W.P.
6060. - Allan Meltzer, 1976.
Monetary and Other Explanations of the Start of the Great Depression. Journal
of Monetary Economics, 455 – 471. - Christina Romer, 1988.
The Great Crash and the Onset of the Great Depression. NBER W.P. 2639. - __________, 1991. What
Ended the Great Depression? NBER W.P. 3829. - Futurecasts, 2002. Book
Review of The End of Globalization:
Lessons from the Great Depression by Harold James. (April 1). {on
internet} - Brad de Long, 1990. “Liquidation” Cycles:
Old Fashioned Real Business Cycle Theory and the Great Depression. NBER W.P.
3546. - Gerald Epstein and Thomas
Ferguson, 1984. Monetary Policy, Loan Liquidation and Industrial Conflict:
The Federal Reserve and the Open Market Operations of 1932. Journal of Economic History (December). - __________, 1991. Answers
to Stock Questions: Fed Targets, Stock Prices and the Gold Standard in the
Great Depression. Journal of Economic
History (March). Great Depression to Great Recession: The Time
Between Golden Age
– Stagflation – Disinflation - Moderation -
The Economic Report of the President,
1962 http://fraser.stlouisfed.org/publications/ERP/issue/1079/ -
The Economic Report of the President,
1975 http://fraser.stlouisfed.org/publications/ERP/issue/1279/ -
The Economic Report of the President,
1982 http://fraser.stlouisfed.org/publications/ERP/issue/1385/ -
Leonard Rapping and Lawrence Pulley, 1985. Speculation, Deregulation, and the
Interest Rate. American Economic Review
(May). -
Jordi Galí and Luca Gambetti, 2009. On the Sources of the Great
Moderation. American Economic Journal: Macroeconomics (January). The Subprime Triggered
Financial Crisis, the Great Recession, the Long Slump -
Hyman Minsky, 1975. John Maynard Keynes. -
Perry Mehrling, 2011. The New Lombard
Street. -
Joseph Stiglitz, 2010. Freefall. -
Raghuram Rajan, 2010. Fault Lines. -
_____________, 2005. Has Financial Development Made the World Riskier? NBER
W.P. 11728. -
Stephen Cecchetti, 2009. Crisis and Response: The Federal Reserve in the
Early Stages of the Financial Crisis. Journal
of Economic Perspectives (Winter). -
Markus Brunnermeier, 2009. Deciphering the Liquidity and Credit Crunch
2007-2008. Journal of Economic
Perspectives (Winter). -
Rene Stulz, 2010. Credit Default Swaps and the Credit Crisis. Journal of Economic Perspectives
(Winter). -
Thomas Ferguson and Robert Johnson, 2009. Too Big to Bail: The Paulson Put,
Presidential Politics and the Global Financial Meltdown. International Journal of Political Economy (Part I, Spring; Part
II, Summer) -
Stefano Battison, et.al., 2009. Liaisons
Dangereuses: Increasing Connectivity, Risk Sharing, and Systemic
Risk. NBER W.P. 15611. -
Atif Mian and Amir Sufi, 2010. The Great Recession: Lessons from Microdata. American Economic Review (May). -
Barry Eichengreen and Peter Temin, 2010. Fetters of Gold and Paper. NBER W.P.
16202. -
Alan Blinder and Mark Zandi, 2010. How the Great Recession Was Brought to an
End. http://www.economy.com/mark-zandi/documents/End-of-Great-Recession.pdf -
John Cochrane, 2009. Fiscal Stimulus, Fiscal Inflation or Fiscal Fallacies. http://faculty.chicagobooth.edu/john.cochrane/research/papers/fiscal2.htm -
Gauti Eggertsson and Paul Krugman, 2010. Debt, Deleveraging, and the
Liquidity Trap. http://www.princeton.edu/~pkrugman/debt_deleveraging_ge_pk.pdf -
Robert Hall, 2011. The Long Slump. American Economic Review (March). Catch
up and Overview Final Examination 6 – 8 pm. |