Undergraduate Course: Monetary Policy and the Labour Market (ECNM10122)
Course Outline
| School | School of Economics |
College | College of Arts, Humanities and Social Sciences |
| Credit level (Normal year taken) | SCQF Level 10 (Year 4 Undergraduate) |
Availability | Available to all students |
| SCQF Credits | 20 |
ECTS Credits | 10 |
| Summary | This course provides an empirical and theoretical overview of how monetary policy affects the economy. In addition to key macro variables like output and inflation, the course will also focus on how monetary policy impacts the aggregate labour market. We'll also consider the question of how monetary policy should be conducted. For example, we¿ll consider if central banks should simply target inflation as in many countries, or also consider other variables such as unemployment in their policy-setting. |
| Course description |
In this course, students will be given an in-depth introduction to key facts and theoretical models on how monetary policy works, how it interacts with the aggregate labour market and the rest of the macroeconomy, and what trade-offs central banks face when attempting to stabilize business cycles.
Topics covered may include: Basics of central banking and monetary policy implementation; an introduction to the New Keynesian macroeconomic framework, which explains how monetary policy impacts the economy and what trade-offs it faces; alternative models of monetary policy to cover topics like stabilising expectations, and escaping the zero lower bound; state-of-the-art empirical research on the effects of monetary policy and the changing policy environment; an overview of key models of labour market rigidities in the search and matching tradition; and an integrated New Keynesian model with labour market frictions, which allows us to explore whether and how monetary policy can best stabilize fluctuations in both unemployment and inflation.
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Information for Visiting Students
| Pre-requisites | Visiting students must have an equivalent of at least 4 semester-long Economics courses at grade B or above for entry to this course. This MUST INCLUDE courses in Intermediate Macroeconomics (with calculus); Intermediate Microeconomics (with calculus); Probability and Statistics; and Introductory Econometrics. If macroeconomics and microeconomics courses are not calculus-based, then, in addition, Calculus (or Mathematics for Economics) is required. |
| High Demand Course? |
Yes |
Course Delivery Information
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| Academic year 2025/26, Available to all students (SV1)
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Quota: 100 |
| Course Start |
Semester 2 |
Timetable |
Timetable |
| Learning and Teaching activities (Further Info) |
Total Hours:
200
(
Lecture Hours 20,
Seminar/Tutorial Hours 6,
Programme Level Learning and Teaching Hours 4,
Directed Learning and Independent Learning Hours
170 )
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| Assessment (Further Info) |
Written Exam
80 %,
Coursework
20 %,
Practical Exam
0 %
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| Additional Information (Assessment) |
Midterm Exam: 20%
Degree Exam: 80% |
| Feedback |
Not entered |
| No Exam Information |
Learning Outcomes
On completion of this course, the student will be able to:
- Have had the opportunity to develop and demonstrate a knowledge and understanding of key economic issues in the analysis of how monetary policy impacts the economy.
- Have had the opportunity to develop and demonstrate research and investigative skills such as problem framing and solving and the ability to assemble and evaluate complex evidence and arguments.
- Have had the opportunity to develop and demonstrate communication skills in order to critique, create and communicate understanding and to collaborate with and relate to others.
- Have had the opportunity to develop and demonstrate personal effectiveness through task-management, time-management, dealing with uncertainty and adapting to new situations, personal and intellectual autonomy through independent learning.
- Have had the opportunity to develop and demonstrate practical/technical skills such as, modelling skills (abstraction, logic, succinctness), qualitative and quantitative analysis and general IT literacy.
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Reading List
There is no single textbook or other reference that covers the entire course. The lecture slides and tutorials are self-contained. The following is a tentative list of further reading:
Part 1: Monetary policy
1. Pierpaulo Benigno. 2015. ¿New-Keynesian economics: An AS¿AD view.¿ Research in Economics, vol. 69(4), pp. 503¿524.
2. Karl Whelan. 2023. ¿Lecture Notes on Macroeconomics.¿ (only Part I: The IS-MP-PC Model)
Part 2: The labour market
1. Christopher A. Pissarides (2017). Equilibrium Unemployment Theory. MIT Press.
2. Pierre Cahuc, Stéphane Carcillo and André Zylberberg (2014). Labour Economics. MIT Press.
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Additional Information
| Graduate Attributes and Skills |
Not entered |
| Keywords | Not entered |
Contacts
| Course organiser | Dr Lauri Esala
Tel:
Email: Lauri.Esala@ed.ac.uk |
Course secretary | Miss Allegra Wallace Von Hirschberg
Tel:
Email: Allegra.Wallace@ed.ac.uk |
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