November 17, 2003
Econ 101b: Fall 2003: Syllabus

Economics 101b: Fall 2003 Schedule Updated October 9, 2003 This Page: Course Index Page: J. Bradford DeLong Office Hours: Th 1-3, Evans 601, or by appointment Rui Pedro Esteves resteves@econ.Berkeley.EDU Office Hours: Th 2-4, Evans 508-3 Lecture Meets: TTh 11:00-12:30, 70 Evans Sections Meet: TTh 8 AM, 45 Evans; TTh 1 PM, 39 Evans This is the go-faster and do-more version of macroeconomics--the study of the determination of output, production, income, employment, and prices in the economy as a whole. Two books are required: The intermediate macroeconomics textbook I am most comfortable with: my own (which should be in the bookstore the week of August 25). Why I wrote this textbook. Order it online. The Economic Report of the President (available online at You might also browse, for recent economic data, the CEA-JEC Recent Economic Indicators. And if you want alternative takes at the subject matter, let me recommend two alternative textbooks: Greg Mankiw's Macroeconomics (4th edition):, and Olivier Blanchard's Macroeconomics (2nd edition): Since this is a go-faster do-more course, we will go faster and do more. As a group, the class will be made up of people comfortable using calculus, so I'll...

Posted by DeLong at 12:28 PM

October 27, 2003
Econ 101b: Fall 2003: Revised for the Final Month

Revised for the final month of Econ 101b: Part IV: STICKY-PRICE BUSINESS CYCLE MACROECONOMICS (cont.) ... October 28 Lecture: Stabilization Policy (textbook chapter 13). Optional reading: Alan Blinder (1999), Central Banking in Theory and Practice (Cambridge: MIT Press: 0262522608). Problem Set 7 out. Section: Liquidity Traps October 30 Lecture: Financial Crises and Deflation (textbook chapter 13). Section: Review and Questions November 4 Lecture: Questions and Review Section: Problem Set 7 due; go over Problem Set 7. November 6 Lecture: Second Midterm Exam No Section. Part V: ECONOMIC POLICY November 13 Lecture: Budget Deficits and National Debt (textbook chapter 14). Problem Set 8 out. Additional reading: Economic Report of the President, chapter 5. Section: Go over Midterm Exam. November 18 Lecture: International Economic Policy Regimes (textbook chapter 15). Additional reading: Economic Report of the President, chapter 6. Section: Political business and budget cycles. Additional reading: Alberto Alesina (1987), "Macroeconomic Policy in a Two-Party System as a Repeated Game", Quarterly Journal of Economics 102:3, pp. 651-78. November 20 Lecture: International Currency Crises (textbook chapter 15). Problem Set 9 out. Section: Problem Set 8 due; go over Problem Set 8. November 25 Lecture: Where We Have Been? The 1990s (Optional reading: Alan Blinder...

Posted by DeLong at 10:58 AM

October 09, 2003
Econ 101b: Fall 2003

Economics 101b: Fall 2003: Index Page Problem Sets | Problem Set Answers Exams | Exam Answers Notes on Lectures Notes on Sections Stray Thoughts...

Posted by DeLong at 02:40 PM

Econ 101b: Fall 2003: October 9 Lecture

Economics 101b: Fall 2003: Lecture Notes: Sticky-Price Model Chapter 9 Lecture Notes Draft. Chapter 10 Lecture Notes Draft....

Posted by DeLong at 10:44 AM

October 02, 2003
Econ 101b: Fall 2003: October 2 Lecture

Economics 101b: Fall 2003: Lecture Notes: Flexible-Price Model and Quantity Theory of Money Chapter 7 Lecture Notes Draft. Chapter 8 Lecture Notes Draft....

Posted by DeLong at 10:43 AM

September 30, 2003
Econ 101b: Fall 2003: September 30 Lecture

Economics 101b: Fall 2003: Lecture Notes: Flexible-Price Model Chapter 6 Lecture Notes Draft....

Posted by DeLong at 10:42 AM

September 03, 2003
Econ 101b: Fall 2003: The Erosion of Okun's Law

We used to have considerable confidence in Okun's law: that an extra one percentage point rise (or fall) in the unemployment rate over a year would reduce (or boost) that real GDP growth by an extra 2.5 percent over that year because a rising (or falling) unemployment rate would also be accompanied by a falling (rising) share of the population in the labor force and by falling (rapidly rising) productivity. Productivity would fall when the unemployment rate rose for two reasons: first, even when factories are not running at full capacity they still incur substantial setup and maintenance costs; second, even when there isn't enough work for them to do firms would rather hold onto skilled workers than watch them drift away and have to pay to train their replacements the next time the wheel of the business cycle turns. Things have been different, however, in this recession (and to a lesser extent in the preceding early-1990s recession. The standard relationship between output growth and hours worked has gone substantially awry. See that branch poking out of the scatter diagram on the left side? That's the most recent data. (The smaller twig pointing out below and to the left...

Posted by DeLong at 04:22 PM