Advanced Macroeconomics

Note: Since the many formula in the EPUB and Mobi versions of the book are displayed as images, we recommend using a medium-sized font for reading. Formulae font may not match well with the main text font if very small or very large text font sizes are chosen

Read online or download for free

Scroll down to open individual chapters

Supplementary material for this textbook, including slides and DSGE and VAR estimation tutorials, can be found here

Supported by the LSE Knowledge Exchange and Impact Fund

Macroeconomic policy is one of the most important policy domains, and the tools of macroeconomics are among the most valuable for policy makers. Yet there has been, up to now, a wide gulf between the level at which macroeconomics is taught at the undergraduate level and the level at which it is practiced. At the same time, doctoral-level textbooks are usually not targeted at a policy audience, making advanced macroeconomics less accessible to current and aspiring practitioners.

This book, born out of the Masters course the authors taught for many years at the Harvard Kennedy School, fills this gap. It introduces the tools of dynamic optimization in the context of economic growth, and then applies them to a wide range of policy questions – ranging from pensions, consumption, investment and finance, to the most recent developments in fiscal and monetary policy. It does so with the requisite rigor, but also with a light touch, and an unyielding focus on their application to policy-making, as befits the authors’ own practical experience.

Advanced Macroeconomics: An Easy Guide is bound to become a great resource for graduate and advanced undergraduate students, and practitioners alike.

“A tour de force. Presenting modern macro theory rigorously but simply, and showing why it helps understand complex macroeconomic events and macroeconomic policies.” — Olivier Blanchard (Peterson Institute, Professor Emeritus at MIT, and former Chief Economist and Director of Research at the IMF)

“This terrifically useful text fills the considerable gap between standard intermediate macroeconomics texts and the more technical text aimed at PhD economics courses. The authors cover the core models of modern macroeconomics with clarity and elegance, filling in details that PhD texts too often leave out. At the same time, the authors draw on their own extensive policy experience to provide thoughtful policy motivation and historical context throughout. Advanced undergraduates, public policy students and indeed many economics PhD students will find it a pleasure to read, and a valuable long-term resource.” — Kenneth Rogoff (Thomas D. Cabot Professor of Public Policy and Professor of Economics at Harvard University, former Chief Economist and Director of Research at the IMF)

“This is an excellent and highly rigorous yet accessible guide to fundamental macroeconomic frameworks that underpin research and policy making in the world. The content reflects the unique perspective of authors who have worked at the highest levels of both government and academia. This makes the book essential reading for serious practitioners, students, and researchers.” — Gita Gopinath (John Zwaanstra Professor of International Studies and of Economics at Harvard University, Chief Economist and Director of Research at the IMF)

“The words Advanced and Easy rarely belong together, but this book gets as close as possible. It covers macroeconomics from the classic fundamentals to the fancy and creative innovations necessary to anyone interested in keeping up with both the policy and the academic worlds.” — Arminio Fraga (former president, Central Bank of Brazil)