Published Aug 02, 2022
This course considers some of the main problems of macroeconomics and addresses their policy implications.
This is a research-oriented course in macroeconomics. Topics may include issues in economic growth and development, economic inequality, fiscal policy, labour market policy, and business cycles.
The Fall 2022 iteration of ECON 603/703 focuses on economic crises.
| Articulate a coherent view of the 2008 financial crisis |
| Assess the economic impacts of the Covid 19 epidemic |
Week | Date | Topic |
|---|---|---|
1 | Sept. 8 | introduction |
2 | Sept. 13 – Sept. 15 | unemployment fluctuations |
3 | Sept. 20 – Sept. 22 | self-fulfilling banking crises |
4 | Sept. 27 – Sept. 29 | banking crises and fundamentals |
5 | Oct. 4 – Oct. 6 | the 2007–2009 financial crisis |
6 | Oct. 11 – Oct. 13 | READING WEEK |
7 | Oct. 18 – Oct. 20 | housing and mortgage markets |
8 | Oct. 25 – Oct. 27 | the Great Recession |
9 | Nov. 1 – Nov. 3 | the role of debt in the financial system |
10 | Nov. 8 – Nov. 10 | an economic perspective of the Covid-19 epidemic |
11 | Nov. 15 – Nov. 17 | the role of liquidity during Covid 19 |
12 | Nov. 22 – Nov. 24 | effects of Covid-19 on the labor market |
13 | Nov. 29 – Dec. 1 | economic impacts of Covid-19 |
14 | Dec. 6 | conclusion |
Part 1. Introduction
Labor market fluctuations:
Shimer, Robert: “The cyclical behavior of equilibrium unemployment and vacancies,” American Economic Review, March 2005, 25-49.
Banking crises:
Diamond, Douglas and Philip Dybvig: “Bank runs, liquidity, and deposit insurance,” Journal of Political Economy, June 1983, 401-419.
Allen, Franklin and Douglas Gale: “Optimal financial crises,” Journal of Finance, August 1998, 1245-1284.
Part 2. The 2007–2009 financial crisis
Brunnermeier, Markus: “Deciphering the liquidity and credit crunch 2007-2008,” Journal of Economic Perspectives, Winter 2009, 77-100.
Manuel Adelino, Antoinette Schoar and Felipe Severino: ``The role of housing and mortgage markets in the financial crisis,'' Annual Review of Financial Economics, November 2018, 25-41.
Atif Mian and Amir Sufi: ``What Explains the 2007-2009 Drop in Employment?'' Econometrica, November 2014, 2197-2223.
Holmström, Bengt: “Understanding the role of debt in the financial system,” January 2015, BIS working paper no. 479.
Part 3. The COVID–19 crisis
Brotherhood, Luiz, Philipp Kircher, Cezar Santos and Michèle Tertilt: ``An economic model of the Covid-19 epidemic: The importance of testing and age-specific policies,'' CEPR Discussion Paper DP14695, April 2020. [Featured in CEPR, VoxEU, June 12, 2020 \\ (https://voxeu.org/article/effectiveness-age-specific-policies-and-testing-covid-19)].
Lei Li, Philip Strahan and Song Zhang: ``Banks as lenders of first resort: evidence from the covid-19 crisis,'' NBER working paper No. 27256, May 2020.
Stephania Albanesi and Jiyeon Kim: ``Effects of the COVID-19 Recession on the US Labor Market: Occupation, Family, and Gender,'' Journal of Economic Perspectives, Summer 2021, 3-24.
Chetty, Raj, John N. Friedman, Nathaniel Hendren, Michael Stepner, and the Opportunity Insights Team: “The economic impacts of COVID-19: evidence from a new public database built using private sector data,” Harvard University, November 2020.
| Component | Value |
|---|---|
| Class participation | 10% |
| Assignments | 75% |
| Presentations | 15% |
| Assignment | Due date | Weighting |
| A1 | Sept. 13 | 5% |
| A2 | Sept. 20 | 7% |
| A3 | Sept. 27 | 7% |
| A4 | Oct. 4 | 7% |
| A5 | Oct. 18 | 7% |
| A6 | Oct 25 | 7% |
| A7 | Nov. 1 | 7% |
| A8 | Nov. 8 | 7% |
| A9 | Nov. 15 | 7% |
| A10 | Nov. 22 | 7% |
| A11 | Nov. 29 | 7% |
| Total | 75% |
Assignments:
A1. Discuss Shimer (2005, Section I. U.S. Labor Market Facts).
A2. Discuss Diamond and Dybvig (1983).
A3. Discuss Allen and Gale (1998).
A4. Discuss Brunnermeier (2009).
A5. Discuss Adelino et al. (2018).
A6. Discuss Mian and Sufi (2014).
A7. Discuss Holmström (2015).
A8. Discuss Brotherhood et al. (2020).
A9. Discuss Li et al. (2020).
A10. Discuss Albanesi and Kim (2021).
A11. Discuss Chetty et al. (2020).
Detailed information about each assignment is found in LEARN under “Assignments”. Late submission of assignments is not accepted.
Presentations:
P1. Oct. 18: Adelino et al. (2018).
P2. Oct. 25: Mian and Sufi (2014).
P3. Nov. 1: Holmström (2015).
P4. Nov. 8: Brotherhood et al. (2020).
P5. Nov. 15: Li et al. (2020).
P6. Nov. 22: Albanesi and Kim (2021).
P7. Nov. 29: Chetty et al. (2020).
No assignment screening will be used in this course.
All deferred Final Exam requests for economics courses are administered by the Economics Undergraduate Office. Please consult the Deferred Exam Policy at
https://uwaterloo.ca/economics/undergraduate/resources-and-policies/deferred-final-exam-policy.
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