The texts marked with (**) are of compulsory reading

**The current state of macroeconomics****No reading of the papers below is compulsory**. You will not be evaluated on the basis of whether you have read these papers or not.

If you are curious, and have time, you may read (in a light manner) the first two papers, to get an idea of the current state of macroeconomics.

Rogoff, K. (2010). "Three Challenges Facing Modern Macroeconomics," American Economic Association Grand Challenge White Papers for Future Research, September 21.. Woodford, M. (2008). "Convergence in Macroeconomics: Elements of the New Synthesis", forthcoming in*American Economic Journal - Macroeconomics*, Vol. 1, (1).. Blanchard, O. (2008). "The State of Macro", NBER Working Paper 14259, Cambridge, Mass.. There is also a very recent (and funny) entry in the "The Economist" about the current state of macro. However, it is a slide based presentation, not very easy reading for students. Not conpulsory reading, but if you are curious see:

**The Economist, Jan 21st 2013, "A Brief History of Macro"**, http://www.economist.com/blogs/freeexchange/2013/01/brief-history-macro

**Stylized facts about business cycles****No really compulsory reading on this topic**. As far as the points in the slides are concerned:

**(i)**For points (1) to (4) students are advised (but not obliged) to read chapter 3 of: Stephen Williamson (2011), Macroeconomics, 4th Edition, Prentice Hall.

**(ii)**For point (5), I hope the slides are self-sufficient. But if you are very curious about filters, in particular about the Hodrick-Prescott filter, yoy can read:

Dirk Krueger (2007). "Quantitative Macroeconomics: An Introduction"**(Chapter 2)**, unpublished manuscript, Department of Economics University of Pennsylvania . It's a small text (12 pages), easy to read and very useful for the study of the stylized facts of business cycles, in particular, to understand how the Hodrick-Prescott filter is calculated.

**(iii)**If you want to see how NBER dates the business cycles see the small paper

Determination of the December 2007 Peak in Economic Activity, NBER, Mass., Cambridge .**(iv)**For point (6), no reading required. Slides are supposed to be self-sufficient. However, you may have doubts about this stuff. If so, you can read just two sections of the paper below by Antonio Fatás and Ilian Mihov:

Section 1: "Introduction" (pages 1 and 2)

Section 3: "Dating recoveries" (Pages 9--20

Antonio Fatás and Ilian Mihov (2013) "Recoveries", CEPR, London .

**Introduction to dynamic processes: fixed points and stability**Use as much as possible the slides in your study.

But if you feel like needing some further support from a textbook in order to consolidate your knowledge, please read the parts of Chapters 2 and 3 of Edward R. Scheinerman (1996). Invitation to Dynamical Systems, Prentice Hall. that are considered in the slides.

Notice that the two chpaters cover continuous and discrete time, but in this course we just discuss discrete time.

The entire book can also be downloaded from here,*http://www.ams.jhu.edu/~ers/invite.html*, where you can also find solutions to the end-chapters exercises.

**Introduction to Matlab**

There is compulsory reading here:

(**) David Griffiths (2005). An Introduction to Matlab. Mark Gockenbach - A Practical Introduction to Matlab. Matlab Tutorials. Matlab Primer

**Two Period Economies: with exogenous and endogenous labor supply**Eric Sims (2014). "Intermediate Macroeconomics: Consumption", University of Notre Dame. Lecture Notes.Read only sections 1 to 3 (pages 1 to 20). Notice that section 4 (Multi-Period Generalization and the Life Cycle) is not for reading at all. So please skip pages 20 to 28. Also, notice section 5 deals with "Liquidity Constraints", which is material that will only be covered next week. J.C. Conesa and C. Garriga (2011). Teoria Económica del Capital y la Renta, Universitat Autònoma de Barcelona.**Chapter 4**.In this chapter read only sections 4.1 and 4.3.

J.C. Conesa and C. Garriga (2011). Teoria Económica del Capital y la Renta, Universitat Autònoma de Barcelona**(Chapter 5)**In this chapter read only sections 5.1.**Heterogeneity: inequality and financial constraints**For financial constraints:

Eric Sims (2014). "Intermediate Macroeconomics: Consumption", University of Notre Dame. Lecture Notes.Read only section 5 (pages 28 to 34)..J.C. Conesa and C. Garriga (2011). Teoria Económica del Capital y la Renta, Universitat Autònoma de BarcelonaRead only section 4.4 of chapter 4.

For inequality:

Eric Sims (2014). "Intermediate Macroeconomics: Consumption", University of Notre Dame. Lecture Notes.Read the entire paper.**Fiscal Policy and Ricardian Equivalence**Gianluca Violante (2010). Ricardian Neutrality of Fiscal Policy, Lecture Notes, New York University, Department of Economics. . A very, very short text: just 4 pages.

Ben J. Heijdra (2009). Foundations of Modern Macroeconomics, Second Edition, Oxford University Press. As a complement to the previous bibliographical entry, in chapter 6 of this book read only sections 6.1.1 and 6.1.2. (and here stop at the "Intermezzo").

**Overlapping Generations and the Sustainability of Social Secutity Systems**Stephen Williamson (2006). Notes on Macroeconomic Theory (Chapter 2: Growth With Overlapping Generations", Deparment of Economics, Washington University in St. Louis.**Notice that this text covers the part related to Overlapping Generations: read only pages 23 to 31**.

Mathias Doepke (2009). Fiscal Policy, Lecture Notes, Northwestern University.**Notice that this text covers the part related to the sustainability of social security systems: read only pages 38 to 42**.

**Monetary Policy: Current Controversies****No compulsory readings for this section of the course**

Reasons:

1. There are many versions of the "Inflation game": some of them more sophisticated than the one covered in these slides; while others are so crude that they miss the major points explained above.

2. So we kept somewhere in the middle of the two main sides above.

3. I made some points easier by removing some assumptions of the more sophisticated versions.

4. So I was afraid of recommending you to read one or another version of this more sophisticated material.

5. I am not aware of any set of notes available that cover the problem as analyzed in these slides

**Just for curiosity (not compulsory)**, these are some useful texts for the highly curious student:

Bradford DeLong (2007). "Central Bank Credibility and Consistency: The Analytics, University of Berkeley." Very good, and very simple. Presentation different from our classes.

Bradford DeLong (2007). Appendix to Chapter 13 . "Central Bank Credibility and Consistency", University of Berkeley. Provides numerical examples to the previous reference.

Robert Becker (2001). "The Infation Game", Lecture Notes, Indiana University. Not very demanding, but follows a presentation rather different from ours.

Thomas J. Sargent and Ulf Söderström (2000). "The conquest of American infation: A summary", Sveriges Risksbank Economic Review, 2000 (3), pag. 12-45. This is a wonderful text, but unfortunately much more demanding than what we expect from our course, so ....