Updated January 24, 2019 - Please refer to syllabus often, as it is a living document

Harvard University

EC 10b – PRINCIPLES OF ECONOMICS (MACROECONOMICS)

SPRING 2020

Lectures: Mon/Wed, Location: Sanders Theater: 10:30 a.m.–11:45 a.m.

Sections: Thu or Fri

Students are responsible for reading and understanding all of the information in this syllabus
before enrolling in the course.

Professor: Jason Furman

● [email protected], Littauer 317
● “Group” walk-in office hours: Mondays 4:30-5:30 p.m during the semester, including
reading period (with the exception of January 27 and March 23). Group office hours is a
discussion format that engages all students in a joint conversation. You can also schedule
“non-group” office hours through his assistant Alison Barron ([email protected]).

Professor: David Laibson

● [email protected], Littauer M12
● “Group” walk-in office hours: Thursday 11:30 a.m.-12:30 p.m. during the semester,
including reading period (with the exception of April 23). Group office hours is a discussion
format that engages all students in a joint conversation. You can also schedule “non-group”
office hours through his assistant Emily Sall ([email protected]).

In addition to office hours, the Professors will host about eighteen 15-student lunches where you
can ask questions about whatever topics interest you. See our Canvas website for the lunch
sign-up link. This is a first-come-first-served sign-up system with priority for students who
haven’t yet attended an Ec 10 lunch during the academic year. We will make an effort to hold
enough lunches so that every student that wants to join one of these spring semester lunches will
be able to do so, even if you already attended a lunch during the fall semester. Paul Kelso will
send you an email confirming your lunch seat after you’ve signed up (about one week before the
lunch is held). These lunches allow for far more students to interact with faculty than Classroom
to Table and replace that program for this course.

Head Section Leader: Thomas Baranga

● [email protected], Littauer 111
● Walk-in office hours: Tuesday 10:00 a.m-12:00 p.m., Wednesday 3:00-4:00 p.m.

Course Coordinator: Paul Kelso

● [email protected], 617-495-2167, Littauer 107
● The office is open 8:30 a.m.- 4:00 p.m. on Monday through Friday.
 Updated January 24, 2019 - Please refer to syllabus often, as it is a living document

Section Leaders: Kevin Banifatemi, Thomas Baranga, Hugues Boulnois, David Brown, Zac
Dearing, Kevin DeLuca, Allicen Dichiara, Matthew Ferranti, Ian Ferrell, Sakina Haider, Janka
Hoffmann, Kaan Inan, Nuheen Khan, Alex Khoury, Julia Klein, Brian Linville, Joe Meeker, John
Moore, Ibrahim Ouf, Kristen Paz, Louis-Samuel Pilcer, Karen Robinson-Rafuse, Lauren Russell,
Utkarsh Saxena, Jordan Shapiro, Ivan Stoitzev, Carlos Teixeira, Harish Vemuri, Disha Verma,
Spencer Welch, Steve White, Lena Yoon

COURSE DESCRIPTION

Ec 10b continues the curriculum presented in Ec 10a. Building off of the descriptive and ethical
frameworks of Ec 10a, Ec 10b moves from the study of microeconomics (individual
decision-making and individual markets) to the study of macroeconomics (e.g., the growth of the
overall economy, unemployment, and inflation). Ec 10b explains what economists do and do not
understand about why per capita income varies so much across countries and what factors
determine the rate of aggregate economic growth. Ec 10b also explains why the economy
fluctuates, as illustrated by sharp changes in the rate of unemployment, the net rate of job
creation, and the rate of overall economic growth—in the most extreme cases called recessions.
The course also explains how policy makers attempt to manage and dampen these fluctuations
using both monetary policy (i.e., government influence over interest rates and government
regulation of banks) and fiscal policy (e.g., government control of spending and taxation). We
will also discuss how macroeconomic policies work in an international context, including the
factors that affect exchange rates, trade deficits, international capital flows, and how these link
economies around the world. Finally Ec 10b studies household finances, both from a positive
perspective (what households do) and a normative perspective (what they ought to do to achieve
their desired goals). Like Ec 10a, Ec 10b introduces students to economic models and discusses
both how they are supported and how they are contradicted by available data.

COURSE NOTES

Ec 10b is the second half of an integrated two-semester sequence that starts with the study of
microeconomics in Ec 10a. Students may elect to take only the fall course or only the spring
course. This sequence is designed for two types of students. For students who will never take
another economics course, Ec 10a and 10b provide a self-contained training to prepare them to
understand and engage with economic issues. For those students who decide to be Economics
Concentrators, Ec 10a and 10b provide a wide-ranging introduction to the field and are required
courses. The Department of Economics strongly encourages students considering concentrating
in Economics to take these courses during their first year in the College. Ec 10a and 10b are not
duplicative of AP Economics courses and provide a broader modern perspective and a deeper
engagement with public policy. From Fall 2019 onward, Ec 10a or 10b fulfill the Social Sciences
distribution requirement for the General Education program. It is not necessary for students to
take both halves of Ec 10 to fulfill this requirement.
PREPARATION, REQUIREMENTS AND CREDIT

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Preparation: There is no mathematics background requirement. No calculus is used in the

course and the use of algebra is very limited.

Economics concentration requirements: Ec 10a and Ec 10b are required courses for both
economics concentrators and students pursuing a secondary in Economics. However, students
who wish to place out of Ec 10a and or Ec 10b can replace each waived course by taking an
additional upper-level Economics elective instead.

General Education credit: Ec 10a or Ec 10b, taken any time as of Fall 2019, can fulfill the new
distribution requirement in the Social Sciences as long as neither is used to fulfill USW or EMR
(or the equivalent new requirements). Please contact the Program in General Education with any
additional questions: https://generaleducation.fas.harvard.edu/questions

COURSE POLICIES

Academic integrity: You are expected to uphold the Harvard College honor code and abide by
the other University policies on academic honesty and integrity as given in the Harvard College
Handbook for Students. Violations of these policies are subject to strict sanctions up to and
including expulsion from the University. Following the policies of the College, Ec 10 has a
zero-tolerance policy on cheating. As required by the College, all instances of suspected cheating
will be referred to the Harvard Honor Council.

Accessibility: We are committed to offering fair access to the course for all students. Students
who believe they may need special accommodations should reach out to the Accessible
Education Office (see www.accessibility.harvard.edu).

Taking Ec 10b pass/fail: If you want to take the course pass/fail, bring a pass/fail form to the Ec
10 office (the relevant form should appear, pre-populated, in your student portal after the course
registration deadline). Please check your own department’s rules on grading status; for example,
the Economics Department does not permit concentrators (and economics secondary field
students) to take either Ec 10a or Ec 10b on a pass/fail basis.

Lectures: Attending lectures or watching them online is mandatory. Much of the learning will
take place in the lecture and is not covered in the readings.

Sections: Those students who took Ec 10a and are continuing in Ec 10b will receive an email
from their Ec 10a section leader detailing when and where their section will meet this semester.
The majority of section leaders and times will not change from fall to spring, so returning
students will automatically be defaulted into their old section.

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If you are continuing from Ec 10a and would like to request a change of section, please write to
Paul Kelso ([email protected]) with your preferred section times by 2 pm on Wednesday
January 29th.

A few of our section leaders from the fall are not returning (Mariano Sosa, Richard Sun, and
Roger Vargas). If you were in one of these sections, you will receive an email from Paul Kelso
by the evening of Wednesday January 29th with information about your new section.

If your spring schedule is incompatible with your fall section time or if you did not enroll in Ec
10a in the fall, you will need to resection for the spring. In this case please write to Paul Kelso
with your preferred section times by 2 pm on Wednesday January 29th.

Attending section is mandatory, attendance will be taken, and short quizzes will be administered
in every section. Sections will teach new material you will need to know to understand the next
week’s lectures and also reinforce and extend material from previous lectures. If you cannot
make your section one week then you can attend another section—but please inform your section
leader, the section leader whose section you are attending, and Paul Kelso. Attendance at your
officially assigned section is required during the weeks of February 17 and April 13, when the
debates will be held in section. Section switches will not be granted during debate weeks. If you
want to switch sections after the initial assignment please ask Paul Kelso. Please note that Paul
cannot accommodate requests to be re-sectioned to a specific section leader.

Simultaneous enrollment: Students may simultaneously enroll in Ec 10b and another class that
meets MW 10:30-11:45 a.m. However students who simultaneously enroll must obtain
permission from the instructor of their other class to attend the Ec 10b midterm exam, which will
take place on Wednesday March 11 from 10:30-11:45 a.m. No make-up midterm exam will be
offered. Students who choose simultaneous enrollment may opt out of the Ec 10b midterm if the
other simultaneous enrollment class holds a midterm on that same day as our midterm. In that
case, all of the weight of the Ec 10b midterm will be reallocated to your final exam. Students do
not need to attend Ec 10b lectures in person, but are expected to watch the lecture recordings
later the same day after class to ensure that they stay current with the course material.

Grades: The grade distribution in Ec 10a and in Ec 10b is intended to be similar to the
distributions in other comparable large courses (however, we will not use a strict curve). Grades
are determined by:

Problem sets 15%

Quizzes 10%
Essays 5%
Debate 5%
Midterm 22%
Final exam 43%
Optional URP Problems 6% (one percentage point per unit—see below)

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Note, this adds up to 106%! Because the Unit Review Program (URP) is completely optional,
you can get a perfect score in the course without doing any of the URP problems. But you can
get a bump if you do take them, and if you take the unit tests you are likely to do better on other
parts of the course as well.

Your problem sets, essays and debates will be graded by your own section leaders (this differs
from Ec 10a where problem sets were graded in larger groups, we think this change will improve
feedback and ensure your section leader gets to know you better). We do not assign students
letter grades for individual exams or assignments, with the exception of the essays. Instead, we
track the raw scores that you receive. At the end of the semester, we add up all the raw scores
you have earned in the course, calculate a weighted average (see weights above), and use the
resulting weighted average to determine your letter grade.

Late or missed work: Late and missed work will not be accepted and there will be no makeups
for problems sets, essays, quizzes, the debate, or the midterm. (Makeups for the final follow the
Harvard Registrar’s procedures regarding excused absences due to sickness and other reasons.)
Your lowest two quiz grades are dropped in calculating the quiz grade. Your lowest problem set
grade is dropped in calculating the problem set grade. This dropping policy is intended to cover
the many legitimate reasons you might have an excused absence. Naturally, we strongly
encourage you to take all quizzes and do all problem sets (even if you expect these are the ones
that will be dropped at the end of the semester). The best way to learn the material in Ec 10 is to
do all of the problem sets.

Midterm flexibility: Thesis writers and students with unavoidable conflicts may substitute out
of the midterm (this includes a simultaneous midterm in a simultaneous enrollment course). For
such students, the weight on the final will be increased by 22 percentage points (which is just
passing the midterm weight to the final). Please email the head section leader no later than 11:59
p.m. on February 21 if you are requesting permission to waive the midterm because you have
an unavoidable conflict or are a thesis writer. Please explain why you are requesting to waive the
midterm (i.e., why you have an unavoidable conflict). The head section leader will get back to
you with either a confirmation that your request is approved or an explanation for why your
request has not been approved. The rules for students enrolled simultaneously are explained
above in the “simultaneous enrollment” paragraph. Finally, note that many exam conflicts arise
because an athletic team is at an away game. In many of these cases, coaches are often willing to
proctor your exam at the same time that it is given in class. Consider asking your coach to do this
for you (they are often very happy to help out in this way). Such proctoring arrangements are not
mandatory, but we find that most students prefer to do this rather than shifting the weight of the
midterm to the final.

Regrades: If you believe there was an error in grading your midterm or final you may bring it to
Paul Kelso in the Ec 10 office for regrading. Bring a written explanation of your request, as well
as your entire exam. The entire exam will be regraded (your score could go up or down). The
deadline to submit regrade requests is within one week of the in-section distribution of graded
exams. Note that the scantron that grades the multiple choice midterm and final exams makes

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PDF copies of your answer sheets so any alterations after you take the exam will be observed
and referred to the Honor Council.

Class participation: We expect all students to participate in all surveys and games that are sent
in advance of the lectures, this is essential both to your understanding and for the benefit of your
classmates. We also encourage students to participate in class by answering questions that we
pose and by posing questions of their own. We have the following goals in mind:

1. We want class participation to reflect the perspective of the typical student, and not just a
small number of students who know the material inside and out.
2. We want all students to be actively thinking about what is happening in lecture.

Please ask and answer questions in class.

Electronics in the classroom: Electronic devices may not be used in class unless you opt into a
“laptop” seating section of the classroom (in which laptops and iPads may be used for
course-relevant purposes). Cell phones and smart watches are not allowed to be used in class (in
any section of the room). If you wish to sit in the laptop section, please send Paul Kelso an email
by 11:59 p.m. on February 6 (with subject line LAPTOP) explaining why it is pedagogically
valuable for you to use a laptop in class. In our experience, for most students laptops are a
distraction more than anything else. Laptops are also a distraction when the people around you
are using them. If you submit a petition to use a laptop and your request is accepted, you will be
issued an Ec 10 (non-transferable) laptop sticker, which you can pick up in class—we’ll have a
list of all the approved names. Please place the sticker in a visible location on the exterior of your
laptop. After February 6, no more laptop petitions will be accepted.

REQUIRED TEXTBOOK

The course uses Macroeconomics by Daron Acemoglu, David Laibson, and John List (2nd
edition). Students must have access to MyLab with eText for Macroeconomics, Second Edition.
Students will use MyLab with eText to access the textbook as well as problem sets that provide
learning aids, immediate feedback, and auto-grading. Students need online access, which
includes MyLab, to submit some of the material on their problem sets. In addition to other
pedagogical benefits, using MyLab frees up section leader time by reducing the amount of
manual grading, enabling us to increase the length of office hours.

To access MyLab, just click on the “MyLab and Mastering” link in our Canvas site (you
will then be prompted to enter account information/set up an account). Electronic (online) access
costs $55.99, which includes both the online version of the textbook and access to MyLab. If you
prefer, from within MyLab, you can pay $9.99 more to receive a printed loose-leaf version of the
text, but note that dozens of physical copies of the book are on reserve in Lamont Library. We
have obtained a steep discount on the textbook. David (one of the three coauthors) has arranged
not to be paid any royalties from the sales of this book to students in our class.

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ASSIGNMENTS

Problem sets (highest 7 out of 8 count towards 15% of your grade): Ec 10b has 8 problem
sets. The lowest grade is dropped when we calculate your problem set grade. Problem sets are
designed to be challenging, and to take time and thoughtful consideration. They are not meant to
be direct applications of lecture or section material; instead they are meant to test and stretch
your understanding of the material.

Problem sets have two parts: questions directly tied to the textbook (we will call these “MyLab”
questions), and additional questions that require either handwritten/typed essays or graphs (we
will call these “Handwritten” questions). Both parts will be accessible via the “Problem Sets” tab
on Canvas, and both parts of each problem set are mandatory. Problem sets are due electronically
at 10:30 a.m. on Friday. Late problem sets will not be accepted.

We encourage students to discuss the problem set questions among themselves. However, each
student should independently solve the problem set on their own, and write (for the long-answer
questions) and hand in their own problem set solutions. If you look at an answer key before
handing in the problem (most problems will have answer keys released before the problem set is
due) please acknowledge this with your submitted answers. You won’t be penalized for looking
at an answer key, but we want you to follow standard academic norms and acknowledge your
sources. We remind you that copying answers verbatim from any source is not allowed.

Quizzes (highest 8 out of 10 count towards 10% of your grade): You will have a short
multiple choice quiz at the beginning of each section that will generally cover the material from
the lectures and readings since the previous quiz. You will get complete credit just for taking the
quiz—its direct effect on the final course grade is as if it was just grading participation.
Nevertheless, we believe you can use the quizzes as a valuable tool to self-motivate to keep up
with the material and as a diagnostic to understand where you need to do more work. Please
bring a smartphone/tablet/laptop to section to do the quiz. If you do not have a smart device,
please let your section leader know so that she/he can troubleshoot!

Essays (2 count towards 5% of your grade): You will have two 500 word essays that allow
you to provide a broader perspective on the material in the course and to apply it to topics that
interest you. Detailed instructions on the essays will be provided when they are assigned.

Debate (5% of your grade): You will have a debate in section (we will use most of two sections
for the debates with half of the class responsible for preparing for each week). You will be
graded on your preparation and performance in that debate. Detailed instructions will be
provided when they are assigned.

Midterm (22% of your grade): The midterm will be in class on Wednesday March 11 (you will
be assigned a specific room based on your section leader’s last name). The midterm covers
material from lectures, sections, and the readings through Monday March 9 and will be entirely
multiple choice and closed book. Ec 10b is designed to prepare you for a richer way of thinking

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than can be reduced to multiple choice questions, thus the variety of problems sets, essays and
debates. In a time-limited exam setting, however, we believe the most fair and accurate way to
assess your understanding of a diverse set of the material is through multiple choice questions.

Final (43% of your grade): The final exam will be on May 9, 9:00 a.m.-12:00 p.m., the date
set by the registrar. It is cumulative and covers material from lectures, sections, and the readings
from the entire course. It will be multiple choice and closed book.

Additional information on all of these assignments will be available on Canvas as the course
progresses—including preparation materials for the midterm and final exams.

UNIT REVIEW PROGRAM

The Unit Review Program (URP) is an important resource for Ec 10 students. The URP helps
you measure your grasp of the course material, gives you practice solving problems, offers you
informal walk-in tutoring in a low-stress environment, and is an opportunity to earn extra credit!

1. How It Works

For the purposes of the URP, the class’s material is divided into six units per semester. For each
unit of material, you can attend one of the URP’s evening sessions and answer a set of written
Unit Review Problems. You have as much time as you need to solve Unit Review Problems (as
long as you finish before the Unit Review session is over), but plan on spending about half an
hour on a review. You may not use notes or receive help from other students.

An upper class undergraduate (the “tutor”) then evaluates your answers and discusses them with
you in small groups or (when possible) in a one-on-one session. If your answers are almost
completely correct, you earn a “Pass” and receive a small boost to your semester grade, which
could potentially affect your overall letter grade (see the section on grading above). If the tutor
does not feel that you are in command of the material, you receive an “Incomplete.” There is no
penalty if you receive an “Incomplete”, but it does not earn you any extra credit. The tutor will
either recommend trying another set of Unit Review Problems immediately, or will suggest that
you review the material before attempting to solve Unit Review Problems once more.

2. The Goal of the URP

Solving Unit Review Problems reinforces your understanding of the material and gives you a
chance to judge your comfort level as well as get real-time feedback and discussion. When the
URP is quiet, tutors are also available to answer your questions on Ec 10 material more broadly,
i.e. serve as drop-in tutors. The best time to take advantage of the URP’s tutoring function is
early in a testing session, rather than just before the deadline, and early in the evening.

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3. Mechanics

Unit Review Problems are offered at the end of each unit, and run for eight days (with the
exception of the final unit, which will be offered on six), on Monday, Tuesday, Wednesday,
Thursday, and Sunday evenings starting at 6:30 p.m. All completed answers must be turned in by
9:00 p.m. You should bring paper and a pen or pencil with you. Loose-leaf paper will often, but
not always, be available. The schedule and location for the URPs will be posted on the Ec 10
Canvas site.

To avoid congestion at the Unit Review Program, students are assigned to groups, each with its
own Unit Review deadline. You will be allocated to a group based on your section. The order of
the groups’ deadlines rotates for fairness. If you miss your group’s deadline, you may still go to
the URP and solve Unit Review Problems for practice, but you will not receive credit for them.
To be fair to all students, Unit Review Problem deadlines are firm, and there are no exceptions. If
you have any questions about the URP, you may ask your section leader or contact Stacey
Gelsheimer, the URP Coordinator, at [email protected]. The Ec 10 office staff
cannot help you with questions about the URP.

ONLINE RESOURCES

Our Canvas site hosts:

● The syllabus
● The course schedule (section and lecture dates, problem set schedule, quiz schedule,
reading assignment due dates)
● Announcements (such as office hours)
● URP information
● “Handwritten” problem set questions
● Detailed problem set answer keys
● Helpful hints
● Exam prep material – these are posted a few days prior to exams
● Links to the readings
● The link to MyLab – this is the online textbook publisher.
● Required quizzes
● Weekly lunch sign-up link

MyLab hosts:

● “MyLab” problem set questions

● Practice problems
● A fully electronic version of the textbook, and a bunch of other useful support material.
(there’s also a MyLab mobile app you may want to download so you can quiz yourself
when waiting at the doctor’s office, riding your stationary bike, etc.)

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CONCERNS AND FEEDBACK

This is David and Jason’s first time teaching Ec 10 and we have made substantial changes to the
course. We are committed to making this course intellectually rewarding, idea based, personally
relevant, and as interactive as possible given the large size. If it is not, please tell us and we will
try to do better.

You can give feedback to us in a variety of ways. If it is a broad suggestion about the course then
you should give your feedback to David, Jason, Thomas or your section leader through any of
these means: (i) we will conduct an anonymous survey early in the semester, we will be taking it
seriously—and hope you tell us what you would like to see us improving (and, if possible, how);
(ii) David and Jason will generally be available for short discussions after class; (iii) office
hours; (iv) email; or (v) an anonymous Google form that you can link to from our Canvas
website (the team will regularly monitor new entries).

If it is an administrative matter please email the Ec 10 office at [email protected].

We take your opinions seriously and any conversation is completely confidential.

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COURSE SCHEDULE AND TEXTBOOK READINGS

TEXTBOOK &
ASSIGNMENTS
DATE† TOPIC
(*Additional
Reading)
UNIT 1 – INTRODUCTION
Jan 27 Overview of Macroeconomics 5.1
Jan 29 The Wealth of Nations 5.2-5.3

Jan 31 Section: Price Measurement, GDP Deflator and CPI 5.4

Feb 3 Aggregate Incomes 6

UNIT 2 – GROWTH

Feb 5 Growth and the Solow Model 7

Feb 7 Section: Mathematical Tools for Macroeconomics *, PS1, Q1

Feb 10 Fundamental Drivers of Growth 8

Feb 12 The Future of Economic Growth *

Feb 14 Section: Data Analysis Tools *, PS2, Q2

Feb 17 Holiday - President’s Day

UNIT 3 – MICROECONOMIC TOOLS

Feb 19 Employment and Unemployment 9.1-9.3 & 9.5

Feb 21 Section: Debate PS3, Q3

Feb 24 Employment and Unemployment *

Feb 26 Credit Markets and Banks 10

Feb 28 Section: Credit Markets and Banks, continued Essay 1, Q4

March 2 Money, Prices, and Inflation 11.1-11.3

March 4 The Federal Reserve, Bank Reserves, and the Monetary System 11.4-11.5

March 6 Section: Midterm Review PS4, Q5

March 9 Guest Lecture (Karen Dynan)

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March 11 Midterm

March 16-20 Spring Break

UNIT 4 – FLUCTUATIONS

March 23 Macroeconomic Fluctuations 12

March 25 Conventional Monetary Policy 13.1-13.2

March 27 Section: Background on Bonds *, PS5, Q6

March 30 Low Interest Rates & Unconventional Monetary Policy *

April 1 Fiscal Policy 13.3

April 3 Section: Monetary and Fiscal Policy, continued PS6, Q7

April 6 Debt Sustainability & Fiscal Policy with Low Interest Rates *

UNIT 5 – INTERNATIONAL

April 8 Trade 14.1, 14.3, *

15.1-15.3, Essay2,
April 10 Section: Exchange Rates
Q8,
April 13 Monetary, Fiscal & Exchange Rate Policy in an Open Economy 14.2

April 15 Issues in International Macroeconomic Policy *

April 17 Section: Debate PS7, Q9

April 20 Guest Lecture (Greg Mankiw & Lawrence Summers)

UNIT 6 – HOUSEHOLD FINANCE

April 22 Household Finance 1 Web Chapter 1.1-1.3

April 24 Section: Household Finance, continued PS8, Q10

April 27 Household Finance 2 Web Chapter 1.4

April 29 Summation

May 9 Final Exam

†Dates listed for sections are for the Friday sections. Thursday sections will cover the same material for the week.

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ADDITIONAL READINGS

In addition to the textbook, there are a few additional required readings as well as optional
readings for the different units. All of these—except the optional books—are posted on Canvas.

It is also strongly recommended that you read additional articles about economics throughout the
course. Some great sources include major newspapers like The New York Times and The Wall
Street Journal, The Economist, and the website Econofact.

Here are some optional books you may be interested in reading in conjunction with the course as
a whole or in the future to deepen your engagement.

● The Economy by the Core team. An alternative (free) textbook that offers a
complementary perspective to the material covered in the course.

● Why Nations Fail by Daron Acemoglu and James Robinson

● Manias, Panics and Crashes by Charles Kindleberger

● The Rise and Fall of American Growth by Robert Gordon

● The Great Escape by Angus Deaton

● The Naked Economist by Charles Wheelan

In addition to these readings we will be posting “Helpful Hints” on Canvas as the course goes
along that provide some additional background and explanation of topics that are not fully
covered in the textbook or other readings.

The Harvard library provides Harvard students with free access to several publications including
The Wall Street Journal and The Washington Post.

Required Reading (In Addition to the Textbook)

Feb 7 (section): Mathematical Tools for Macroeconomics

Helpful hint (to be posted in advance)

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Feb 12: The Future of Economic Growth

Gordon, Robert. 2014. “The Turtle’s Progress: Secular Stagnation Meets the Headwinds.” In
Secular Stagnation: Facts, Causes, and Cures, eds. Coen Teulings and Richard Baldwin.
London: Centre for Economic Policy Research (CEPR).

Brynjolfsson, Erik, and Andrew McAfee. 2014. “The Dawn of the Age of Artificial
Intelligence.” The Atlantic. February 14.

Bloom, Nicholas, Chad Jones, John Van Reenen, and Michael Webb. 2017. “Ideas aren’t
Running Out, but they are Getting More Expensive to Find.” VoxEU. September 20.

Feb 14 (section): Data Analysis Tools

Helpful hint (to be posted in advance)

Feb 24: Employment and Unemployment

Black, Sandra, Jason Furman, Emma Rackstraw, and Nirupama Rao. 2016. “The Long-Term
Decline in US Prime-Age Male Labour Force Participation.” VoxEU. July 6.

Blau, Francine D, and Lawrence M. Kahn. 2013. “Female Labor Supply: Why is the United
States Falling Behind.” American Economic Review: Papers & Proceedings 103(3): 251-256.

Ip, Greg. 2017. “Robots Aren’t Destroying Enough Jobs.” The Wall Street Journal. May 10.

Acemoglu, Daron, and Pascual Restrepo. 2017. “Robots and Jobs: Evidence from the US.”
VoxEU. April 10.

Mar 27: Background on Bonds

Helpful hint (to be posted in advance)

(If you like learning by videos you could watch Khan Academy, “Relationship Between Bond
Prices and Interest Rates.”

Mar 30: Low Interest Rates & Unconventional Monetary Policy

Summers, Lawrence H. 2019. “The Risk to Our Economy From Secular Stagnation.” The
Washington Post. March 7.

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Bernanke, Ben S. 2017. “How Big a Problem is the Zero Lower Bound on Interest Rates?” Ben
Bernanke’s Blog. April 12.

Bernanke, Ben S. 2017. “The Zero Lower Bound on Interest Rates: How Should the Fed
Respond?” Ben Bernanke’s Blog. April 13.

The Economist. 2012. “QE, or not QE?” The Economist. July 14. [Note: link requires Harvard
login]

Apr 6: Debt Sustainability & Fiscal Policy With Low Interest Rates

Blanchard, Olivier. 2019. “Public Debt: Fiscal and Welfare Costs in a Time of Low Interest
Rates.” Peterson Institute for International Economics Issue Brief 19-2.

Ramey, Valerie. 2019. “It’s Time to Start Worrying About the National Debt.” The Wall Street
Journal. August 23.

April 8: Trade

Textbook from Ec 10a Chapters 8.4 and 8.5 (this will be made available to all students, even
those who only purchased MyLab for Ec 10b).

Apr 15: Issues in International Macroeconomic Policy

The Economist. 2016. “The Mundell-Fleming Trilemma: Two Out of Three Ain’t Bad.” The
Economist. August 27. [Note: link requires Harvard login]

Porter, Eduardo. 2017. “Trump Isn’t Wrong on China Currency Manipulation, Just Late.” The
New York Times. April 11.

Slaughter, Matthew J. 2016. “The Myths of China’s Currency ‘Manipulation’.” The Wall Street
Journal. January 8.

Feldstein, Martin. 2012. “The Failure of the Euro.” Foreign Affairs 91(1): 105-116. [Note: link
requires Harvard login]

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Apr 22: Household Finance

Acemoglu, Daron, David Laibson, and John List. 2018. “Appendix Chapter 1.” In
Macroeconomics, second edition. New York: Pearson.

Optional Readings

Unit 1 - Introduction

Coyle, Diane. 2017. “Rethinking GDP.” IMF Finance & Development 54(1): 16-19.

Cavallo, Alberto, and Roberto Rigobon. 2016. “The Billion Prices Project: Using Online Prices
for Measurement and Research.” Journal of Economic Perspectives 30(2): 151-178.

Milanovic, Branko. 2013. “Global Income Inequality in Numbers: In History and Now.” Global
Policy 4(2): 198-208. [Note: link requires Harvard login]

Friedman, Benjamin M. 2006. “The Moral Consequences of Economic Growth.” Society 43(2):
15-22.

Unit 2 - Growth

The Economist. 2018. “Free Exchange: Root and Branch, Economists Understand Little About
the Causes of Growth.” The Economist. April 12. [Note: link requires Harvard login]

Lucas, Robert E. 2004 . “The Industrial Revolution: Past, Present, and Future.” Federal Reserve
Bank of Minneapolis. May 1.

Zhu, Xiaodong. 2012. “Understanding China's Growth: Past, Present, and Future.” Journal of
Economic Perspectives 26(4): 103-124.

Pritchett, Lant. 1997. “Divergence, Big Time.” Journal of Economic Perspectives 11(3): 3-17.

Barro, Robert. 1991. “Economic Growth in a Cross-section of Countries.” Quarterly Journal of

Economics106(2): 407-443. [Note: link requires Harvard login]

Acemoglu, Daron, Simon Johnson, and James A. Robinson. 2001. “The Colonial Origins of
Comparative Development: An Empirical Investigation.” The American Economic Review 91(5):
1369-1401.

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Unit 3 - Microeconomic Tools

Blanchard, Olivier. 2018. “Should We Reject the Natural Rate Hypothesis?” Journal of
Economic Perspectives 32(1): 97–120.

Abraham, Katharine G., Melissa S. Kearney. 2019. “Explaining the Decline in the U.S.
Employment-to-Population Ratio: a Review of the Evidence.” NBER Working Paper 24333.
Cambridge, MA: National Bureau of Economic Research.

Goldin, Claudia. 2014. “A Grand Gender Convergence: Its Last Chapter.” The American
Economic Review 104(4): 1091-1119.

Furman, Jason. 2016. “Is This Time Different? The Opportunities and Challenges of Artificial
Intelligence.” Remarks at AI Now: The Social and Economic Implications of Artificial
Intelligence Technologies in the Near Term, New York, NY. July 7.

Bernanke, Ben S. 2009. “Lessons of the Financial Crisis for Banking Supervision.” Remarks at
the Federal Reserve Bank of Chicago Conference on Bank Structure and Competition, Chicago,
IL. May 7.

Brunnermeier, Markus K. 2009. “Deciphering the Liquidity and Credit Crunch 2007-2008.”
Journal of Economic Perspectives 23(1): 77-100.

Yellen, Janet L. 2017. “Financial Stability a Decade after the Onset of the Crisis.” Remarks at the
Federal Reserve Bank of Kansas City symposium on Fostering a Dynamic Global Recovery,
Jackson Hole, Wyoming. August 25.

Bernanke, Ben S. 2018. “Financial Panic and Credit Disruptions in the 2007-09 Crisis.” Ben
Bernanke’s Blog. September 13.

Mankiw, N. Gregory. 2018. “Learning the Right Lessons From the Financial Crisis.” The New
York Times. July 27.

Unit 4 - Fluctuations

Bernanke, Ben S. 2013. “A Century of US Central Banking: Goals, Frameworks,

Accountability.” Journal of Economic Perspectives 27(4): 3-16.

Campbell, John Y. 1995. "Some Lessons from the Yield Curve." Journal of Economic
Perspectives 9(3): 129-152. [Note: link requires Harvard login]

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Friedman, Milton. 1968. “The Role of Monetary Policy.” The American Economic Review 58(1):
1-17.

Taylor, John B. 2000. “Reassessing Discretionary Fiscal Policy.” Journal of Economic

Perspectives 14(3): 21-36.

Reinhart, Carmen M., Vincent R. Reinhart, and Kenneth S. Rogoff. 2012. “Public Debt
Overhangs: Advanced-Economy Episodes since 1800.” Journal of Economic Perspectives 26(3):
69–86.

Auerbach, Alan J., William G. Gale, and Benjamin H. Harris. 2010. “Activist Fiscal Policy.”
Journal of Economic Perspectives 24(4): 141–164.

Furman, Jason, and Lawrence H. Summers. 2019. “Who’s Afraid of Budget Deficits?” Foreign
Affairs 98(2): 82-95. [Note: link requires Harvard login]

Unit 5 - International

Feldstein, Martin, and Charles Horioka. 1980. “Domestic Saving and International Capital
Flows.” The Economic Journal 90(358): 314-329. [Note: link requires Harvard login]

Ghosh, Atish and Jonathan Ostry. 2009. “Choosing an Exchange Rate Regime.” Finance and
Development 46(4): 38-40.

Blanchard, Olivier, and Gian Maria Milesi-Ferretti. 2013. “(Why) Should Current Account
Balances Be Reduced?” IMF Economic Review 60(1): 139-150. [Note: link requires Harvard
login]

Frankel, Jeffrey. 2015. “International Macroeconomic Policy Coordination.” VoxEU. December

9.

Unit 6 - Household Finance

Siegel, Jeremy J., and Richard H. Thaler. 1997. “Anomalies: The Equity Premium Puzzle.”
Journal of Economic Perspectives 11(1): 191-200.

DeLong, J. Bradford, and Konstantin Magin. 2009. “The U.S. Equity Return Premium: Past,
Present, and Future.” Journal of Economic Perspectives 23(1): 193-208.

Daniel, Kent, and David Hirshleifer. 2015. “Overconfident Investors, Predictable Returns, and
Excessive Trading.” Journal of Economic Perspectives 29(4): 61-88.

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