Last Update: 5:40PM 12/15/96

Course Evaluation Form (for use by the students who took the class only)

To course ftp site, where materials are available as downloadable files.

Growth Accounting Exercise, Due Wednesday, 9/18/96

Solow Model Exercise, Due Wednesday 10/2/96

Overlapping Generations Exercise, Due Wednesday 10/16/96

Paper Topics List

Review Exercise, Due Wednesday 11/6/96

Review Exercise 2, Due Wednesday 12/4/96 MS Word version pdf version

Notes on Natural Resources: MS Word version

         pdf version

Additional details in the outline and readings added 12/1/96. They appear in the same color as this note.
Econ. 153a
Fall 1996 
C. Sims


The course will use Macroeconomics (South-Western College Publishing), by Alan Auerbach and Laurence Kotlikoff, as a text. (It is referred to as AK below.) Parts of the book Economic Growth, by Robert Barro and Xavier Sala-I-Martin (RX below), also available at the Coop, may be the basis for some lectures. There will be a final exam, some problem sets, and an individually chosen project involving graphical analysis of economic data. There will be two review problem sets that will count toward the grade.

The class is taught by

Christopher Sims
37 Hillhouse Ave., Rm. 5
phone: 432 6292

  1. Growth
    1. Questions
      1. What explains the disparities in wealth across nations
      2. Do disparities in wealth tend to dissipate over time?
      3. What explains the slow-down in wage growth?
    2. Tools
      1. Growth Accounting
      2. The Cobb-Douglas Production Function
    3. Reading
      1. AK Chapter 1, Chapter 5. Chapter 5 discusses output measurement, most of which should be familiar to you.
      2. "Economic Growth in East Asia: Perspiration vs. Inspiration", by Susan Collins and Barry Bosworth (This paper is on reserve at CCL.)
      3. Notes on the Solow model handed out, and Sections 1.1 and 1.2, p.14-38, of RX. The RX reading covers much the same material as the notes on the model theory, plus some basic facts about convergence in the data on countries and regions.
  2. Accumulation
    1. Questions
      1. Why do market economies accumulate indefinitely, if people have finite lives?
      2. How does the age structure of the population affect accumulation?
      3. How does accumulation affect the welfare of different generations?
      4. Exhaustible resources: Do markets take care of intergenerational equity?
    2. Tools
      1. Overlapping Generations Models
    3. Readings
      1. AK Chapters 2 and 3
  3. Long Term Fiscal Policy
    1. Questions
      1. Do public deficits "crowd out" private investment?
      2. Are deficits a "burden on future generations?
      3. How should fiscal policy adjust to an aging population structure?
    2. Readings
      1. AK Chapter 7.
  4. Real Business Cycles
  5. International Linkages and Growth
    1. Questions
      1. What are the trade deficit, the current account balance, and the capital account balance, and how are they linked?
      2. How does international borrowing and lending among rich and poor countries affect growth?
    2. Readings
      1. 00">Readings
        1. AK Chapter 6
    3. Inflation and Deflation
      1. Readings
        1. AK Chapter 8
    4. Unemployment
      1. Readings
        1. AK Chapters 10 and 11