Credits: 6

Schedule: 21.11.2019 - 19.12.2019

Teacher in charge (valid 01.08.2018-31.07.2020): 

Seppo Honkapohja

Teaching Period (valid 01.08.2018-31.07.2020): 

II-III (2019-2020), intensive course

Learning Outcomes (valid 01.08.2018-31.07.2020): 

Models of imperfect knowledge and learning are an alternative approach and extension of standard macroeconomics modeling that is based rational expectations (RE) hypothesis. This approach has become increasingly used in the last two decades. The approach is not inconsistent with RE as REE can be a long-run outcome of learning with imperfect knowledge. The course gives a thorough introduction to the basic theory and methods to de-velop and analyze learning models. The course will also discuss a number macroeconomic models with learning.

Content (valid 01.08.2018-31.07.2020): 

The course will cover a variety of different types of macroeconomic mod-els: univariate and multivariate linear models, nonlinear models, restricted perceptions and models of social learning. Specific models include mone-tary models, real business cycle models, New Keynesian models, asset pric-ing and models of heterogenous agents. Specific macroeconomic concerns are studied: moentary and fiscal policy, interest ratte zero lower bound, stagnation, hyperinflation. A specific toolkit for analyzing dynamics and long-run outcomes of learning will be developed: stochastic recursive algo-rithms, expectational stability analysis, Bayesian learning.

Assessment Methods and Criteria (valid 01.08.2018-31.07.2020): 

- written exam 50 %
- project report and presentation 50% (projects can be prepared in small groups).

Workload (valid 01.08.2018-31.07.2020): 

- contact teaching 12h
- independent work I: study of lecture material, problem sets 55h
- independent work II: project 50h
- exam 3h
Total 160h

Study Material (valid 01.08.2018-31.07.2020): 

Much (but not all) of the material is in the book Evans and Honkapohja: Learning and Expectations in Macroeconomics, Princeton University press 2001.

Reading list is under development.

Availability

Course Homepage (valid 01.08.2018-31.07.2020): 

https://mycourses.aalto.fi/course/search.php?search=31E03100

Prerequisites (valid 01.08.2018-31.07.2020): 

1st year macroeconomics sequence 1-4 at ResearchMaster/Phd level

Grading Scale (valid 01.08.2018-31.07.2020): 

0 - 5

Registration for Courses (valid 01.08.2018-31.07.2020): 

Registration to course and exams via WebOodi.

Note: students for other universities can register. Also researchers wanting to audit the course can register.

Further Information (valid 01.08.2018-31.07.2020): 

The course is lectured at Economicum (Arkadiankatu 7, Helsinki)

Description

Registration and further information