From the second half of the twentieth century the world had experienced enormous amounts of economic growth and development. GDP per capita for the world has grown from $451 in 1960 to $11,429 in 2019, a 2500% increase! In a developed country such as Japan, its GDP per capita grew from $479 in 1960 to $40,247 in 2019, which was an 8400% increase!
But at the same time, the world also saw recessions and depressions.
In the beginning of 2020, the world economy was hit by a pandemic of COVID-19. The world economy was brought to a sudden drop. The world economic outlook for 2020 by IMF in June 2020 was a growth rate of -4.9%. And back in January, the outlook was forecasting for a 3.3% growth.
How did the devastating setback of economy happen? What could be done to prevent such setback? More importantly, what could be done to help the economy recover? These are typical questions that are often asked by people who are affected by the world economy as well as economists.
In order to answer those questions, we need to understand the economy first. Our course focuses on the behaviors of the economy as a whole. There are three portions of theories in this course.
The first portion is the classical theories in describing the economy in the long run. In equilibrium, what would be the level of output, saving, investment, unemployment rate or trade balances?
The second portion of theories involves growth of the economy. How can we have larger and larger capacity of production? How can we promote technological progress?
Finally we will come back to the present to address the issues of economic fluctuations. The Keynesian theories were developed to explain the behaviors of the economy in the short run. .
The theme of macroeconomics is how to fully utilize the resources. The greatest benefit we can get from the economy is sustainable growth and improvement in standard of living.
Contents
Introduction （0.2 week）
 The Science of Macroeconomics
 How to study this course
Part I – National Income Accounting （0.8week）
 Measuring Output,
 Measuring Costs of Living
 Measuring Unemployment
Part II -- Classical Theory: The Economy in the Long Run (4week)
 Income distribution and Loanable Funds Market
 Money and Inflation
Labor market and Unemployment in the Long Run
 The Open Economy
Part III -- Growth Theory: The Economy in the Very Long Run (2week)
 Solow Model with Capital Accumulation and Population Growth
 Solow Model with Technological Progress
 Endogenous Growth Models
Part IV -- Business Cycle Theory: The Economy in the Short Run (5week)
 Introduction to Economic Fluctuations and the AD-AS Model
 Building the IS–LM Model
 Applying the IS–LM Model to Understand Policies
 The Mundell–Fleming Model and the Exchange-Rate Regime
 Aggregate Supply and the Philippe’s Curve
 A Dynamic Model of Aggregate Demand and Aggregate Supply
