14.451 | Spring 2007 | Graduate

Macroeconomic Theory I


Course Meeting Times

Lectures: 2 sessions / week, 1.5 hours / session

Recitations: 1 session / week, 1.5 hours / session


This is a half semester introduction to the neoclassical growth model-the workhorse of modern macroeconomics-and a review of endogenous growth theory. Topics will include basic facts of economic growth and long-run economic development; brief overview of optimal control theory and dynamic programming; basic neoclassical growth model under a variety of market structures; human capital and economic growth; endogenous growth models; models with endogenous technology; models of directed technical change; competition, market structure and growth; financial and economic development; international trade and economic growth; institutions and economic development. This is a half-term subject. The class size is limited.

If you are an MIT Economics Ph.D. student, you have to take the course (or pass the waiver). Otherwise, please come and see me to discuss whether this course is appropriate for you.


14.461 Advanced Macroeconomics I


Problem Sets 30%
Final Exam 70%

Bonus points are also given for class participation.

Required Texts

Acemoglu, D. Introduction to Modern Economic Growth. Cambridge, MA: Massachusetts Institute of Technology, 2007.

Barro, R. J., and X. Sala-i-Martin. Economic Growth. New York, NY: McGraw-Hill, 1995. ISBN: 0070036977.


I. An Introduction to Growth Models and Growth Facts

Syllabus, Introduction

Economic Growth and Economic Development

The Solow Growth Model

The Solow Growth Model and the Data

R1 Empirics of Economic Growth  
II. The Neoclassical Growth Model

Foundations of Neoclassical Growth

Dynamic Programming and Optimal Growth

Review of the Theory of Optimal Control

The Neoclassical Growth Model

Problem set 1 out on Ses #L4

Problem set 1 due and Problem set 2 out on Ses #L6

R2 The Neoclassical Growth Model  
III. Using the Neoclassical Growth Model Beyond Growth: Asset Pricing, Public Finance, Overlapping Generations
L7-L8 Growth with Overlapping Generations Problem set 2 due on Ses #L8
R3 Applications of the Neoclassical Growth Model Problem set 3 out
IV. Endogenous Growth I: AK, Spillovers, Human Capital

Human Capital and Economic Growth

First-Generation Models of Endogenous Growth

R4 Optimization Methods

Problem set 3 due

Problem set 4 out

V. Endogenous Growth II: R&D, Varieties vs. Quality, Directed Technological Change

Expanding Variety Models

Models of Competitive Innovations

Directed Technological Change

R5 Expanding Variety Models

Problem set 4 due

Problem set 5 out

L13 Summary

Problem set 5 due

Final Exam four days after Ses #L13

Course Info

As Taught In
Spring 2007
Learning Resource Types
Problem Sets
Lecture Notes