Econ 310: Macroeconomic Theory

Class Time:Thursdays 6:30PM-9:10PM

Room: 206 Stephens Hall
Instructor: Dr. Matthew Chambers
Office: 101B Stephens Hall
Phone: 704-3576
E-mail: mchambers@towson.edu
Office Hours: 9:30-11:00 AM T,Th and by appointment
Webpage: http://pages.towson.edu/mchamber
(This is my homepage, there will be a link to this class on this page)
Required Texts: Stephen D. Williamson: Macroeconomics, 4th edition.

Course Outline and Overview

This course is the basic course in macroeconomic theory for undergraduate

economics majors and for non-majors with appropriate background and are
interested in macroeconomic theory and policy.
In this class, we will discuss long-run economic growth and short-run economic fluctuations, business cycles. Growth theory describes and explains how
economic aggregates( such as output, consumption, employment, inflation, interest rates, trade balances, and exchange rates) evolve on average over time.
Business cycle theory looks at how these aggregates fluctuate around these longrun growth trends. Once we have an understanding about the economy evolves
over time, we can then begin analyzing macroeconomic policies, either fiscal or
monetary, and their effects on the economy.
This course has two main objectives. First, by the end of the course everyone
should be able to critique articles on economic issues in news publications such as
The Economists, the Wall Street Journal, or the New York Times using good
economic intuition and knowledge. Second, students should be able to grasp
the framework and language of modern macroeconomic theory. Specifically,
students we have a very good understanding of the workhorse for macroeconomic
theory, the neoclassical growth model.

Course Organization and Prerequisites

This course relies heavy on materials you have seen in your previous economics
courses. The prerequisites for this course are both principles courses (ECON
201 and ECON 202) and either (MATH 211 or MATH 273) Intermediate Microeconomics is not a prerequisite for the course, however, students with this
background will find the framework in this course very similar to that used
that course. There will be no use of calculus in this course. I will be stressing
economic intuition throughout the course, however, sometimes in economics,
mathematical tools are used to make a point more concise. Students should be
1

comfortable with concepts such as standard deviations and correlation coefficients. Many things, such as budget and resource constraints are conveniently
formulated into mathematics and students will be expected to be comfortable
preforming calculations on such things. If you find that you do not meet these
requirements, contact me after the first class.

Course Materials

There is one required textbook for this course. The book is Williamsons
Macroeconomics. We will be using this book throughout the course. In addition to the textbook, I will post lecture notes for the course. I will post these
notes on the course webpage. These notes are not a substitute for the books.
These lecture notes merely summarize the main ideas from each class. The
textbook will contain details that are not found in the notes. I will also post
other materials on the course webpage, ( homework, homework solutions, etc.)
as needed.
Finally, try to keep informed about current events. I will try to address
current issues from time to time as they fit into the course material. Discussing
these topics is more rewarding and enjoyable if students are actively involved
and knowledgeable.

Course Requirements and Grading

Your grade in the course will be based on your performance on homework,

2 midterm exams, and a final exam. There will be a total of 6 homework
assignments. When I calculate your grade, I will drop your lowest homework
grade. In total these homework assignments will constitute 20% of your final
grade in the course. The 2 midterm exams will combine to make up 50% of
your grade, and the final exam will account for the final 30% of the grade.

4.1

Homeworks

Each homework will be worth 20 points. There are 6 homeworks, but I will
only count the best 5 scores when I calculate final grades. At the end of the
semester will take your five best scores and add them up to get your homework
percentage. The following rules regard to all homework assignments without
exceptions.
1. Homeworks will be available, via the internet, on or before the date specified in the course calendar. It is your responsibility to download these
assignments. The due dates for these homeworks will be announced in
class, posted on the web, and placed on the assignment itself.
2. Homeworks are due on the specified date on the course calendar. You
may turn-in the assignment at the end of class, or by 5PM at my office

Stephens Hall 101B. Late homework will not be accepted. If you

cannot make it to class or my office, please make prior arrangements to
have your homework delivered on time.
3. If you disagree about the grading of a certain problem, do the following:
By the next class period after the assignment is returned, hand back your
assignment and a written statement of why you think the problem has been
graded incorrectly. I will then regrade the problem with your information
in mind. Regrading of the problem does not guarantee a higher score, in
fact, it may result in a lower score
4. You are allowed to work in groups. However, each student must hand in his
or her unique assignment. If two students hand in identical assignments,
I will consider this a violation of the academic honesty code, and the
situation will be treated accordingly. Note, that the exams in this class
will be similar to the problems given in the homework, so it is to your
benefit to try and work the problems on your own.

4.2

Midterm Exams

There will be two in-class midterm exams. These exams will count for 25% of
your course grade apiece. There will be no make-up exams for these midterms
unless you have conflict. If you have a conflict you must notify me before the
exam. If you miss the test for any other reason, and do not have an excused
absence, you can not make-up the exam, and you will receive a zero.

4.3

Final Exam

There will be an in-class exam during final exam week. Everyone must take
the final exam. If some emergency arises that will cause a conflict with this
schedule, come see me as soon as possible.

4.4

Extra Credit

There will be one option for extra credit in this course. Since this easiest way to
learn the material in this course is by working homework problems. I will give
students the opportunity to earn bonus points for working additional problems
beyond the homework assignments.

4.5

Grades

Your grade will be calculated based on the top 5 of 6 homework assignments,

a midterm exam and a comprehensive final exam. Homework grades will be
calculated out of the total points possible. Exam grades will be calculated off
of the highest score in the class. The following grading scale will be used when
calculating grades in this course.

Percent
100-92.50
92.49-87.50
87.49-82.50
82.49-77.50
77.49-72.50
72.49-67.50
67.49-62.50
62.49-55.00
below 55.00

Grade
A
AB+
B
BC+
C
D
F

If everyone deserves a good grade, I will give only good grades. But in order
to receive a good grade in this course, you must be prepared for class and work
hard on the homework assignments.

4.6

Attendance

I will not be taking attendance in this course. However, since the is an upper
level course, I would expect student to attend class. Typically students who
attend class regularly score much higher than those who do not.

Academic Honesty

Cheating will not be tolerated in this course. Students are expected to maintain high standards of academic integrity. Cheating and plagiarism are serious
violations and will result in a zero on the assignment and are grounds for a
failing grade in the course. Students should refer to the Universitys policy
on academic integrity in the University catalogue. Violations of the Academic
Integrity Code will be remanded to the Academic Honor Council for additional
punishment as appropriate.

Students with Disabilities

In accordance with university policy, if you have a documented disability and

require accommodations to obtain equal access in this course, please contact
the instructor at the beginning of the semester and when given an assignment
for which an accommodation is required. Students with disabilities must verify
their eligibility through the Office of Disability Support Services located in the
Administration Building Room 232.

Tentative Schedule

Date
9/1
9/8
9/15
9/22
9/29
10/6
10/13
10/20
10/27
11/3
11/10
11/17
12/1
12/8
12/15

Topic
Introduction and Overview
National Income Accounting
Consumer and Firm Behavior
Closed One Period Model and Malthus
Neoclassical Growth Model, Endogenous Growth
Exam 1
Two Period Model of Savings
Ricardian Equivalence and Life Cycle Model
Properties of Life Cycle Model and Government Finance
Real Intertemporal Model with Investment
Exam 2
Money,Banking, Prices, and Monetary Policy
Business Cycle Theory: Market Clearing and New Keynesian
Money, Inflation, Banking
Section 101:Final Exam 7:30PM-9:30PM

Readings
Syllabus
W Ch 1,2
W Ch 4
W Ch 5, 6 (190-207)
Ch 6 (207-237),7
W Ch 8 262-289
W Ch 8 (289-312),Notes
W Ch 10
W Ch 11
W Ch 3,12,13
W Ch 16