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Macroeconomics Analysis

Course developer

Prior knowledge

Ekon5157, Knowledge-Intensive Bioeconomy

EkonM003, Microeconomics Analysis

Replaced course

Ekon5089 [GEKO5089] Macroeconomics Analysis

Course abstract

The topics of the course give an in-depth knowledge of the theoretical principles of a market economy and causal relationships at the macro-level, creating an understanding of how to apply them at various stages of an economic cycle. The course particularly focuses on detailed analyses of macroeconomic models, long-term growth preconditions and prerequisites and the most important macroeconomic policies. The aim of the course is to provide students with in-depth competencies to independently, critically and reasonably analyze the basic indicators and trends of Latvia's national economy in the context of European and world countries.

Learning outcomes and their assessment

KNOWLEDGE
1. Students will be able to: demonstrate a profound knowledge of macroeconomic models and relationships; test.
2. Demonstrate a profound knowledge of preconditions and prerequisites for long-term growth and the macroeconomic policies contributing to it; test.
3. Demonstrate a reasonable understanding of the specifics of application of macroeconomic policy instruments at various economic cycle stages and in various European and world countries, which is a basis for creative thinking and research, independent work, a presentation.
SKILLS
1. Independently identify and use the legal framework and instruments of macroeconomic regulation, substantiate an alternative to solving a particular macroeconomic problem, independent work, a presentation
2. Reasonably explain and discuss urgent economic problems based on macroeconomic conceptions and indicators, a presentation, discussions in seminar classes
3. Do research and based on problem-solving skills, justify the government’s macroeconomic functions and the behavioural patterns of economic entities in unexpected situations and under exceptional circumstances, independent work.
4. Engage in group work and assume responsibility for the results and an analysis of the group work, Group work.
5. Develop social interaction, cooperation and organisational skills needed for employment, discussions in seminar classes.
COMPETENCE
1. Able to independently use theoretical knowledge and practical abilities to formulate and critically analyze complex and dynamic macroeconomic regularities and challenges on a local and global scale, integrate knowledge of macroeconomics and other economic sciences – tests.
2. Theoretically and empirically substantiate and assess national economic policies aimed at maintaining macroeconomic equilibrium and the effects of it on the environment and the society; tests, independent work, seminar classes

Course Content(Calendar)

1. Historical development of macroeconomic analysis models - their nature, functions, historical aspects and role in economic analyses (2 h lectures, 1 h practical);
2. Macroeconomic growth models – theories of economic growth, the theory of national economic growth assessment, the importance of economic policy in promoting growth and development (2 h lectures, 2 h practicals);
3. Macroeconomic equilibrium models of J.M. Keynes and Harrod and Domar and equilibrium conditions (2 h lectures, 2 h practicals);
4. IS-LM model and factors causing changes in equilibrium. Investment policy and the effectiveness of the policy in the national economy of Latvia (2 h lectures, 2 h practicals);
5. IS-LM-BP model. Macroeconomic analysis of foreign trade. The balance of payments. Change in the exports of Latvia and measures for boosting the exports (2 h lectures, 2 h practicals);
6. The Solow-Swan neoclassical growth model. Mandel-Fleming model. Exchange rate issues. Assessment of implementation of Maastricht criteria in Latvia (2 h lectures, 1 h practical);
7. 1st test Macroeconomic models and relationships (1 h practical);
8. Economic growth and the evolution of growth theories. Factors and analysis of economic growth in Latvia. The cyclical nature of economic development, the basic problems and solutions (2 lectures, 2 h practicals);
9. Inflation and employment. Employment and unemployment problems in Latvia, the EU and the world. Modern conceptions of inflation. Relationships between inflation and employment (2 h lectures, 2 h practicals);
10. Fiscal policy analysis. Basic issues of fiscal policy and directions for its improvement. Actualities of fiscal policy in Latvia and EU countries (2 h lectures, 2 h practicals);
11. Long-term development strategy of Latvia, its analysis. Social progress indicators and economic development forecasting. Changes in social progress in Latvia, the EU and the world (2 h lectures, 2 h practicals);
12. 2nd test Long-term preconditions and prerequisites for economic growth and macroeconomic policies affecting the growth (1 h practical).

Requirements for awarding credit points

A written examination covering all the topics studied during the course has to be passed. The final mark consists of the following pieces of evaluation: a test on theory and a test on basic macroeconomic indicators, processes and relationships in the comparative, content and historical aspects, as well as independent work and a presentation.

Description of the organization and tasks of students’ independent work

From the list prepared by the teacher, the student must submit one independent work, in electronic form, 7-10 pages. in the scope in the previously determined terms on the topic "Specificity of the use of macroeconomic analysis models in different stages of the economic cycle and in different countries of Europe and the world". Each student, according to the framework of the specialization direction, using the latest economic literature and relevant economic indicators, independently prepares and presents (10-12 slides) a report in the seminar classes on the topic "Updates of the latest economic development trends and their influencing factors in the context of Latvia, the EU and the countries of the world".

Criteria for Evaluating Learning Outcomes

The final evaluation consists of a written examination (40%) on all the topics, two tests (40%) on the topics “Macroeconomic models and relationships” and “Long-term preconditions and prerequisites for economic growth and macroeconomic policies affecting the growth”, an independent assignment (10%) and a presentation (10%). 10% are equal to one point on a 10-point marking scale.

Compulsory reading

1. Bikse V. Makroekonomika: teorija un politika. LiePA, 2015, 269 lpp.
2. Williamson S. D. Macroeconomics. Global Edition. Sixth Edition UK: Pearson Education Limited, 2023, 731 p
3. Greenlaw S.A. Shapirop D. Principles of Macroeconomics 2e. OpenStax Rice University, 2018, 603 p.
4. Šenfelde M. Makroekonomika. 4. izd. Rīga: RTU, 2014, 245 lpp

Further reading

1. Krugman P., Wells R. Macroeconomics. 5th ed., New York, NY: Macmillan Education, 2018.
2. Kruks S. Ekonomiskā krīze Latvijā: "veiksmes stāsta" pēcgarša . RSU, 2016.
3. Latvijas spēks ilgi pastāvēt. Kolektīva zinātniskā monogrāfija B. Rivžas redakcijā. Latvijas Zinātņu akadēmija, 2022. 479 lpp.
4. Strautiņš P. Latvijā dzīvot ir interesanti. Jāņa Rozes apgāds, 2019. 319 lpp.

Periodicals and other sources

1. Latvijas Makroekonomiskais apskats. Pieejams: https://www.em.gov.lv/lv/latvijas-makroekonomiskais-apskats
2. Latvijas Bankas uzturēta ekonomiskās analīzes vietne. Pieejams: https://www.makroekonomika.lv/
3. The Global Economy: Heightened Tensions, Subdued Growth. - The World Bank. Available from: https://www.worldbank.org/
4. Eurostat mājas lapa. Pieejams: https://ec.europa.eu/eurostat/data/database
5. Centrālās statistikas pārvaldes mājas lapa. Pieejams: www.csb.gov.lv

Notes

Compulsory course for the ESAF academic Master programme Economics