MACRO ECONOMIC ANALYSIS AND POLICY (MEAP)
I Course Objectives:
With the basic understanding of the theories of firms (that deal with the issues operational within the firms), this course is designed to make a systematic coverage of fundamental concepts and relationships that exist among various macro-economic entities. This course provides a basic understanding of the theories and principles relating to the macro-economic environment (that deal with the external or environmental issues operating outside the firms). The course focuses primarily on how an economy functions, the reasons for macro-economic fluctuations and the corrective and regulatory measures from various spheres such as monetary, fiscal and international arena.
The major purpose of the course is to enable the management students to develop a familiarity with the fundamentals of macro-economic principles; understand the complexity and implications of fluctuations in macro-economic entities; and relate the nuances found in various theories and models to real life business environment.
II Course Contents:
Topic 1: (1 session) Introduction ü What does the subject matter of economics deal with? ü Resources of an economy ü Two-sector model of circular flow of economic activities ü Goals of an economy ü Challenges to achieve the goals Suggested Readings:
Topic 2: (4 sessions)
Overview: How do we measure an economy’s progress? ü Gross National Income and Product ü Approaches to estimating GNP ü Related indicators ü Deflating for inflation ü Is GNP a measure of society’s wellbeing? Suggested Readings:
Topic 6: (2 sessions)
The Twin Traps: Inflation and Unemployment ü Inflation: Measures ü Inflation: Causes, Consequences and Cures ü Unemployment: Types and methods of measurement ü Unemployment or Inflation – the Phillip’s Curve ü Unemployment and Inflation – The Supply Shock ü Case analysis on the twin traps Suggested Readings:
Reading Materials / Reference Books: v A text book namely, “Principles of Macro Economics” by William A. McEachern & A. Indira, (Cengage Learning), is being provided to each participant for basic reference. v This is in addition to a reading material prepared by me for this course. v Besides, multiple copies of yet another text book namely, “Macroeconomics” by R. Glenn Hubbard & Anthony Patrick O'Brien (PEARSON) will be kept in the XIMB library for additional reference.
Reading material and the books are prescribed for only preliminary reading, and by no means be adequate to fulfill the learning objectives of this course. For further reading, solving practical questions and problems, additional references are cited above. Besides the text books, reading business related articles, reports, etc., published in periodicals, journals, news magazines and websites, are mandatory for the course.
III Course Evaluation: