Monetary Policy
Faculty
UEDA, Kazuo
ITO, Takatoshi
KANO, Takashi
Credit / Semester / Schedule
2 Credits / Summer Semester / Thursday Period: 2
Description
This course reviews empirical methods of identifying effects of monetary policy on aggregate macroeconomic variables and discusses their difficulties. The course then introduces dynamic stochastic models with rational expectations that are able to explain empirical facts of monetary policy effects. The course covers the optimal monetary policy as well as its implementation.
(1) Undergrad-level macroeconomics
(2) Mathematical and statistical preliminaries
(3) Simple stochastic dynamic models and rational expectations
(4) Identifying effects of monetary policy shocks: structural VARs
(5) Phillips curve and monetary business cycle models
(6) Nominal and real rigidities
(7) Money demand functions
(8) New Keynesian Phillips curve
(9) Optimal monetary policy, Taylor rule, and inflation-targeting rule
(10) Implementation of monetary policy
The course is organized mainly for master students. Knowledge of undergrad-level micro and macro economics is prerequisite.
Course materials
Walsh, C. E., Monetary Theory and Policy, second edition, 2003, MIT Press.
Romer, D., Advanced Macroeconomics, 2001, McGraw-Hill.
Obstfeld, M., Rogoff, K., Foundations of International Macroeconomics, 1996, MIT Press.
Hamilton, J.D., Time Series Analysis, 1994, Princeton University Press.
Grading
Mid-term and final examination