The purpose of this course is to provide participants with an appreciation of the principal concepts of macroeconomics with emphasis on their application to public policy analysis. To do this, the course will help participants to understand:
• the nature of economic aggregates by providing a primer on basic concepts that underpin the macroeconomy;
• the role of government in (a) providing the statutory framework (eg the Public Finance Act 1989, the Reserve Bank of New Zealand Act 1989) and (b) shaping the decisions of individuals and firms through its role in savings, investments, tax and welfare and foreign exchange;
• the scope and limitations of macroeconomic policies in shaping the structure and performance of the New Zealand economy; and
• the micro foundations of macroeconomics by appreciating that all outcomes in the macroeconomy are the results of decisions taken by households and firms.
On completion of this course participants will:
• have an understanding of key macroeconomic terms and concepts;
• be able to relate these to current policy debates; and
• appreciate how macroeconomic outcomes reflect the microeconomic decisions of firms and households and the role of government in shaping those decisions through policies related to stabilisation, redistribution,taxes, welfare, trade, savings and investment.
Session outline and delivery
Day 1: The Big Picture
1.1 Macro questions
1.2 Why learn macroeconomics?
1.3 Introduction to economic models
1.4 Measuring the macroeconomy
Day 2: The Big World
2.1 The open economy
2.2 Exchange rates
2.3 Foreign trade
2.4 Capital Flows
Day 3: The Big Policies
3.1 Fiscal policies
3.2 Monetary policy
3.3 A simple model
3.4 Growth and productivity
Day 4: The Big Debates
4.1 How can policy makers promote economic growth?
4.2 How costly is inflation and how costly is reducing it?
4.3 How big a problem are government deficits?
4.4 Are current account deficits and the external debt a problem?
This course is provided by the Government Economics Network (GEN) at a cost of $500 plus GST per person.