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Macroeconomics II

Module description


The first term covers economic growth and develops a dynamic macroeconomic model from micro foundations, that is aggregate relationships are built up from microeconomic optimisation by representative agents, an important feature of modern macroeconomics. With this foundation, ideas are formalised further in the second term, before delving in to more open economy macroeconomics.

The second term explores two core areas of modern macroeconomics: monetary policy and international macroeconomics. Students will deepen their understanding about the role of monetary policy in the macroeconomy and study its limitations focusing particularly on the role of private sector expectations. Students will also develop their knowledge of how international trade in goods and financial assets affects the macroeconomy and acts to widen the scope of policy decisions.

Additional Information:


This module takes a European and American perspective of macroeconomics, but these ideas are application even in developing countries. Students gain an understanding of exchange rates, why they change over time, what determines them, how to assess the economic prospects of countries. Any company in a global economy must deal with these issues.

This module addresses some of the major policy questions affecting the world economy today. It takes an international perspective on these problems and students will gain an understanding of the policy trade-offs faced by policymakers in the closed and open economies.

External Engagement

Previously, we had a guest speaker lecture on Central Bank policy.


In this module students develop a number of valuable skills, including their capacity for logical thinking, problem solving, analytical and discursive skills.

Full module specification

Module title:Macroeconomics II
Module code:BEE2026
Module level:2
Academic year:2023/4
Module lecturers:
  • Dr Elisa Keller - Convenor
  • Dr Rish Singhania - Convenor
  • Dr Dudley Cooke - Convenor
  • Dr Szabolcs Deak - Convenor
Module credit:30
ECTS value:



Passed BEE1036 and passed BEE1037


Non-Requisites (cannot be taken with): BEE2038, BEE2039, or BEE3062.

Duration of module: Duration (weeks) - term 1:


Duration (weeks) - term 2:


Duration (weeks) - term 3:


Module aims

The aim of the module is to equip students with the basic theoretical ideas of modern macroeconomics,
and how they are applied to core economic problems.

ILO: Module-specific skills

  • 1. Critically assess different policy proposals for managing the macro-economy;
  • 2. Analyse macroeconomic problems qualitatively and quantitatively.

ILO: Discipline-specific skills

  • 3. Develop analytically ability by solving well-defined economic problems;
  • 4. Analyse economic models by expressing relationships through graphs;
  • 5. Present and discuss a piece of economic analysis;
  • 6. Evaluate the characteristics of macroeconomic data and their statistical properties.

ILO: Personal and key skills

  • 7. Identify the essential elements of, and to organise ways to think about, a problem;
  • 8. Demonstrate organisational skills developed by reading for the course topics and preparation for classes.

Learning activities and teaching methods (given in hours of study time)

Scheduled Learning and Teaching ActivitiesGuided independent studyPlacement / study abroad

Details of learning activities and teaching methods

CategoryHours of study timeDescription
Scheduled learning and teaching activity40Lectures
Scheduled learning and teaching activity5Tutorials
Guided independent study255Assigned readings

Formative assessment

Form of assessmentSize of the assessment (eg length / duration)ILOs assessedFeedback method
Tutorial questionsIn class1-8In class feedback

Summative assessment (% of credit)

CourseworkWritten examsPractical exams

Details of summative assessment

Form of assessment% of creditSize of the assessment (eg length / duration)ILOs assessedFeedback method
Mid-term exam (term 1)1050 minutes1-8Written feedback and indicative answers
Term 1 examination402 hours1-8Written feedback
4 MCQ tests (term 2)102 hours1-8Verbal feedback and indicative answers
Term 2 examination402 hours1-8Written feedback

Details of re-assessment (where required by referral or deferral)

Original form of assessmentForm of re-assessmentILOs re-assessedTimescale for re-assessment
Mid-term exam (term 1)Mid-term exam (term 1)1-8August/September reassessment period
Term 1 examinationTerm 1 examination (40%)1-8August/September reassessment period
4 MCQ tests (term 2)Single MCQ test (10%)1-8August/September reassessment period
Term 2 examinationTerm 2 examination 1-8August/September reassessment period

Syllabus plan

Term 1:

  • Measurement
  • Economic growth
  • Micro foundations and a dynamic macro model
  • Expectations: The basic tools. Consumption and investment. Output and policy.

Term 2:

  • Topic 1: Liquidity Traps
  • Topic 2: Interest Rate Rules
  • Topic 3: Monetary Policy and Expectations
  • Topic 4: Optimal Monetary Policy
  • Topic 5: Intertemporal Approach to the Current Account
  • Topic 6: The Law of One Price and Real Exchange Rate
  • Topic 7: Nominal Exchange Rate Determination

Indicative learning resources - Basic reading

Basic reading:

  • Abel, A., Bernanke, B., and Croushore, D., Macroeconomics (8th edition, or above) Pearson.
  • Williamson, S. D., Macroeconomics, 5th ed., Pearson
  • Mankiw, G., and Taylor, M, Macroeconomics (European edition/6th edition, or above), Worth.

Note: there are many versions (inc. ‘International’ and ‘European’) of these books and they change only marginally from edition to edition.

Module has an active ELE page?


Indicative learning resources - Web based and electronic resources


Origin date


Last revision date