The subject is recursive methods and theirapplications in macroeconomics and monetary economics. Some chaptersare more tentative than others. You can e-mail us at sargent@leland.stanford.edu(sargent).
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macroeconomic theory sargent pdf 11
Recursive methods provide powerful ways to pose and solve problems in dynamic macroeconomics. Recursive Macroeconomic Theory offers both an introduction to recursive methods and more advanced material. Only practice in solving diverse problems fully conveys the advantages of the recursive approach, so the book provides many applications. This fourth edition features two new chapters and substantial revisions to other chapters that demonstrate the power of recursive methods. One new chapter applies the recursive approach to Ramsey taxation and sharply characterizes the time inconsistency of optimal policies. These insights are used in other chapters to simplify recursive formulations of Ramsey plans and credible government policies. The second new chapter explores the mechanics of matching models and identifies a common channel through which productivity shocks are magnified across a variety of matching models. Other chapters have been extended and refined. For example, there is new material on heterogeneous beliefs in both complete and incomplete markets models; and there is a deeper account of forces that shape aggregate labor supply elasticities in lifecycle models. The book is suitable for first- and second-year graduate courses in macroeconomics. Most chapters conclude with exercises; many exercises and examples use Matlab or Python computer programming languages.
The standard theory of decision making under uncertainty advises the decision maker to form a statistical model linking outcomes to decisions and then to choose the optimal distribution of outcomes. This assumes that the decision maker trusts the model completely. But what should a decision maker do if the model cannot be trusted? Lars Hansen and Thomas Sargent, two leading macroeconomists, push the field forward as they set about answering this question. They adapt robust control techniques and apply them to economics. By using this theory to let decision makers acknowledge misspecification in economic modeling, the authors develop applications to a variety of problems in dynamic macroeconomics. Technical, rigorous, and self-contained, this book will be useful for macroeconomists who seek to improve the robustness of decision-making processes.
Thomas John Sargent (born July 19, 1943) is an American economist and the W.R. Berkley Professor of Economics and Business at New York University.[2] He specializes in the fields of macroeconomics, monetary economics, and time series econometrics. As of 2020, he ranks as the 29th most cited economist in the world.[3] He was awarded the Nobel Memorial Prize in Economics in 2011 together with Christopher A. Sims for their "empirical research on cause and effect in the macroeconomy".[4]
Sargent is one of the leaders of the "rational expectations revolution," which argues that the people being modeled by economists can predict the future, or the probability of future outcomes, at least as well as the economist can with his model. Rational expectations was introduced into economics by John Muth,[9] then Robert Lucas, Jr., and Edward C. Prescott took it much farther. By some works written in close collaboration with Lucas and Neil Wallace, Thomas J. Sargent could fundamentally contribute to the evolution of new classical macroeconomics.[10]
Sargent has also been a pioneer in introducing recursive economics to academic study, especially for macroeconomic issues such as unemployment, fiscal and monetary policy, and growth. His series of textbooks, co-authored with Lars Ljungqvist, are seminal in the contemporary graduate economics curriculum.
Sargent is known as a devoted teacher. Among his PhD advisees are men and women at the forefront of macroeconomic research[who?]. Sargent's reading group at Stanford and NYU is a famous institution among graduate students in economics.[31][32]
Economics 504 is the second semester of anintegrated two-semester sequence in macroeconomics, required for first-yearPh.D. students in economics. Itassumes that students have already taken the previous semester of this sequence,Economics 503. As with Economics503, the requirements of the course include attendance at the lectures,completion of a series of problem sets, and a final exam for each part.
Several of the topics that we shall take up aretreated in three books, Obstfeld and Rogoff (1996), Walsh (2003), and Woodford (2003). These books are also good general references. A good book on U.S. institutional detail is Mishkin (2001) (this is the 6th edition, but any edition from the 4th is fine). Ljungqvist and Sargent (2004) is a good reference on recursive methods in macroeconomics. 2ff7e9595c
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