Autumn semester 2025

Credits
5 ECTS

Teaching method
Classroom instruction, 24 lectures

Language
English

Examination
3-hour written exam (closed book)

Assessment
Pass/No pass, no co-examiner (re-exam oral or written)

Lecturer
Matthias Hänsel

Contents
The aim of this course is to provide a rigorous graduate-level introduction to macroeconomics. It focusses on fundamental theories, with a view to establishing their key insights and motivating their quantitative application. A tentative list of topics is provided below.

• A brief history of macroeconomics and its methodological approaches
• Long-run growth: Stylized facts and neoclassical theory
• Dynamic Optimization
• Dynamic Competitive Equilibrium theory and its key insights
  • Consumption and risk-sharing
  • Efficiency
  • Infinite vs. finite horizons (Overlapping-generation (OLG) models)
• Introduction to business cycle macroeconomics and key theories, such as
  • Real business cycle models
  • Models with nominal rigidities (New Keynesian)

The precise contents may be adapted to reflect time constraints and student interest.

Description of qualifications
Knowledge and understanding of:

• the evolution of macroeconomics and the theoretical foundations that underpin macroeconomic research
• the key workhorse models of modern macroeconomics and their implications
• the usefulness of macroeconomic theory for both qualitative and quantitative analysis

Skills to:

• Formulate and solve canonical dynamic macroeconomic models with and without uncertainty
• Derive and analyze dynamic equilibria, and evaluate their efficiency and welfare properties.
• Critically assessing macroeconomic models and their implications.

Competences in:

• Integrating theoretical and quantitative perspectives for analyzing macroeconomic questions
• Pursuing research in macroeconomics and related fields

Academic prerequisites
Students should have a basic understanding of differential calculus, constraint optimization, probability theory and linear algebra. Additionally, it is expected that students are familiar with fundamental microeconomic concepts such as demand theory, producer theory and market equilibrium. Prior knowledge of macroeconomics is advantageous but not required.

For PhD students at AU (ECON), this course has been pre-approved as an internal BSS PhD course equivalent to 5 ECTS.

Prerequisites for examination participation
The course will feature 3 problem sets, two of which need to be handed in to participate in the exam. Feedback on handed-in problem sets will be provided and students can earn bonus points for the exam by submitting high-quality solutions.

Literature
Azzimonti et al. (2025).: PhD Macro Book (online textbook available under phdmacrobook.org ) – Chapters 1 to 8, 14 and 18.

Ljungqvist and Sargent (2018): Recursive Macroeconomic Theory – Chapters 8 and 9.

Slides and lecture notes provided by the lecturer.

Registration
By email to Susanne Christensen, sch@econ.au.dk no later than 26 September.

Dates and lecture room
Lectures will take place at Department of Economics and Business Economics.

Week 40: Monday and Wednesday 14:00-16:00
Week 41: Monday and Wednesday 14:00-16:00
Week 43: Monday and Wednesday 14:00-16:00
Week 44: Monday and Wednesday 14:00-16:00
Week 45: Monday and Wednesday 14:00-16:00
Week 46: Monday and Wednesday 14:00-16:00