Macroeconomic Policy

Part 1 Theory: a new Keynesian framework for macroeconomic policy; the linkages between financial weapons and financial targets - a comparative static analysis; the dynamics of price stabilization. Part 2 Application: a stock-flow model with model-consistent or regressive expectations; macroeconomic policy rules for economic stabilization; counterfactual simulation with forward-looking expectations; a simulation of the cost-push economy; the controlled economy with reformed wages. Part 3 Method: the derivation and use of linear model; the design of economic policy rules. Part 4 Conclusion: summary of results and conclusions.