Ph.D. in Economics: Monetary Economics Field
The monetary economics field emphasizes topics in finance theory as well as modern quantitative equilibrium models of the business cycle, ranging from flexible price models of the real business cycle (RBC) variety to new Keynesian monetary models.
This field takes advantage of the traditionally close association and cooperation between the economics and finance faculty of the department. It is established in response to the strong revealed preference of many graduate economics students to supplement their knowledge of economics with expertise in finance. It is expected that the familiarity with both economics and finance will offer students significantly enhanced job opportunities in the financial services industries.
Required Courses
ECON 7710. Advanced Monetary Economics I. Three credits. Prerequisites: students must have passed Ph.D. qualifying exams in microeconomics and macroeconomics. The purpose of this course is to provide an integrated treatment of a variety of dynamic optimization and dynamic equilibrium models and to examine their empirical implications for individual choices and, in particular, savings and asset prices. Three frameworks are studied: infinitely-lived representative agent models, heterogenous agent models, and representative and heterogenous agent models with financial frictions. Advanced numerical solution methods and panel data estimation techniques are also incorporated.
ECON 7720. Advanced Monetary Economics II. Three credits. Prerequisites: students must have passed Ph.D. qualifying exams in microeconomics and macroeconomics. The course serves as an introduction to the leading theories in monetary economics including measurement of the empirical impact of monetary shocks on real activity, money-in-the-utility function and cash-in-advance models, and New Keynesian models featuring sluggish price and wage adjustment. A large emphasis is placed on the analysis of interest rate rules and the conduct of optimal monetary policy under commitment and discretion. Frequent use of numerical dynamic programming and empirical estimation of monetary models allows students to enhance skills necessary to conduct independent research in the field.