Part 1a: Real Business Cycle Models 

01/12/2026: Vanilla RBC Model and Solution Method

01/14/2026: Basic New Keynesian Model and Monetary Policy

01/21/2026: Perturbation and Introduction to Dynare 

01/26/2026: Model of Costly State Verification (Bernanke and Gertler, 1989)

01/28/2026: Model of Financial Accelerator (Bernanke, Gertler, and Gilchrist, 1999)

02/02/2026: Model of Financial Shocks (Jermann and Quadrini, 2012)

Part 1b: Endogenous Growth and Medium-Term Business Cycles

02/04/2026: Neoclassical Growth Model in Continuous Time

02/09/2026: Expanding Variety Models

02/11/2026: Romer Model: Growth with Knowledge Spillover

02/16/2026: Quality Ladder Models

02/18/2026: Models of Medium-Term Business Cycles

02/23-02/25: Review Session and the First Midterm

Part 2a: Dynamic Programming

03/09/2026: Contraction Mapping Theorem and the Principle of Optimality

03/11/2026: Value Function Iteration, Guess and Verify, Model Simulation

03/16/2026: Models with Risk and Stochastic Dynamic Programming 

03/18/2026: Models with Discrete Choice and Recursive Competitive Equilibrium

Part 2b: Search-Theoretic Models

03/23/2026: McCall, DMP, and Hosios Condition

03/25/2026: On-the-Job Search and Wage Posting

03/30/2026: Directed Search

04/01/2026: Liquidity Premium and Search in the OTC Market

Part 2c: Income Fluctuation Problems

04/06/2026: PIT, Consumption Smoothing, and Precautionary Savings

04/08/2026: Neoclassical Investment Models

04/20/2026: Investment under Uncertainty

04/13-04/15: Review Session and the Second Midterm

04/22/2026: Open Economy Macroeconomics 

Final Exam : Tuesday, 4/28/2026 from 12:45 PM - 2:45 PM in Berkey Hall 318

1. Dynamic Programming:

• Sequence versus Recursive Formulation

• Contraction Mapping Theorem and Principle of Optimality

• Guess and Verify, Functional Euler Equation, and Value Function Iteration

• Stochastic Dynamic Programming

• Recursive Competitive Equilibrium

• Matlab: Value Function Iteration and Model Simulation

2. Search-Theoretical Models: Rogerson, Shimer, and Wright (2005)

• McCall Random Search Model

• Diamond-Mortensen-Pissarides: Matching and Wage Bargaining

• Burdett-Mortensen: On-the-Job Search and Wage Posting

• Directed/Competitive Search

• Search in the OTC Market

3. Income Fluctuation Problem:

• Consumption-Savings Problems:

– Permanent Income Theory

– Consumption Smoothing and Precautionary Savings

• Neoclassical Investment Models:

– User Cost Model and Tobin’s Q

– Investment with Convex and Non-Convex Adjustment Costs

4. Real Business Cycles with Financial Frictions:

• Vanilla RBC Models: Dynare Implementation, Simulation, and Impulse Response Functions

• Working Capital Constraints: Jermann and Quadrini (2012)

5. Endogenous Growth Models:

• Continuous-Time Dynamic Programming

• Expanding Variety Models: Inputs and Products, and Social Planner’s Problem

• Quality Ladder Model

• Quality Ladder Model with Firm Dynamics: Klette and Kortum (2004)

6. Introduction to Heterogeneous Agent Models:

• Incomplete Market Model and Wealth Distribution:

– Huggett Model (1993) and Aiyagari Model (1999)

• Models of Firm Dynamics: Entry, Exit, and Firm Size Distribution

– Hopenhayn (1990) and Hopenhayn and Rogerson (1993)