Learning outcomes

After completing the course, the students are expected to be able to:

- analyse how business cycle fluctuations emerge due to changes within and outside the country,

- understand the relation between unemployment and inflation in the short and the long run,

- understand the interaction among interest rates, exchange rates and the balance of current payments with a floating or fixed exchange rate or membership in a monetary union,

- analyse the effects of monetary and fiscal policy using basic macroeconomic models and have an insight into the possibilities and limitations of economic policy in an internationalised economy,

- explain the main characteristics of the macroeconomic trend in the Swedish economy in the last fifty years.

Content

The course mainly analyses the shorter perspective: what is the cause of business cycle fluctuations and what is the role of stabilisation policy? How do inflation and employment covary in the short and the long run? The interaction of the economy with the surrounding world is given a great deal of attention. What is the role of the balance of trade in the short and the long run? How are interests, capital flows, exchange rates, exports and imports interrelated? In what way is the economy affected by the development in the surrounding world? In what ways are the possibilities of carrying out an independent economic policy limited by our living in an internationalised world?

The economic trend in Sweden serves as the background to and an illustration of the theories and relations that are discussed during the course.

Instruction

The instruction consists of lectures with exercises.

Assessment

The assessment consists of a written exam.