Pace University
Lubin School of Business
MBA644: Macroeconomics in the Global Environment
Fall 2018
Instructor Information
Arthur L. Centonze, Ph.D
Telephone: 212-618-6566
Email: acentonze@pace.edu
Office: W-443
Office Hours: Tuesday: 10:45 – 12:00 and 3:15 – 4:00; Thursday: 11:00 – 12:00 and 3:15 – 5:15
Required and Recommended Materials
Baumol, William J. and Blinder, Alan S., Macroeconomics: Principles and Policy, 13th ed., Cengage,
2016. No supplementary materials needed.
Research articles relevant to the course material are assigned in the course outline at the end of this
syllabus. They may be accessed through institutional websites and the Pace University Library.
Students are expected to read the assigned materials prior to class. Class discussion will usually cover
the most challenging concepts and issues, and serve to reinforce and extend the material in the readings.
You are expected to remain current on business and economic developments by reading regularly the
business sections of at least one of the following publications: The Wall Street Journal, The New York
Times, and Financial Times, and weekly magazines such as Business Week and the Economist. Watch
CNBC. You are also encouraged to bring up relevant current events and issues for class discussion.
Several free literature sources are available and recommended through a number of Federal Reserve
Banks e.g., New York, Atlanta, Cleveland, Kansas City, etc. Check their websites for availability.
Other free web sources for economic data and research articles are listed elsewhere in this syllabus.
Course Description
Provides students with a basic understanding of the concepts and techniques of contemporary
macroeconomics. Topics include: global interdependence and the gains from trade; market forces of
supply and demand; supply, demand and government policies; measuring a nation’s income and cost of
living; production and growth; savings, investment and the financial systems; unemployment and its
natural rate; the monetary system; money and inflation; basic concepts of open-economy
macroeconomics; aggregate demand and aggregate supply; and the influence of monetary and fiscal
policy on aggregate demand.
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Course Overview
The course is designed to provide MBA students with the economic tools and conceptual frameworks to
better understand and analyze the causes and consequences of domestic and international
macroeconomic issues. We examine the forces driving the global integration of markets as well as the
governmental policy environment in which business operates. Students, as decision-makers, should
consider the effects of the macroeconomic environment on society at large and on business investment
decisions in particular. Both graphical and algebraic analysis is used to illustrate key points. The course
develops the analytical framework useful to the study of finance, marketing, operations and other
business subjects.
Learning Objectives
1. Master macroeconomic concepts at the national and international levels.
2. Acquire skill in applying these concepts to complex business situations in dynamic organizational
and market environments, both domestically and globally.
3. Learn to analyze domestic and international macroeconomic policy issues systematically and how
these issues influence firm decision-making.
4. Enhance your ability to research, analyze, debate, decide and communicate complex issues.
5. Enhance your ability to work successfully in teams.
Teaching/Course Methodology
This is a lecture course with some interactive work. It combines lectures with readings, class
discussions, and problem solving. Questions and thoughtful comments are encouraged in order to
enliven the material and to benefit from the experience and collective insight of the students in the class.
Students are encouraged to communicate with me through office visits, email and telephone.
Students are expected to attend each class. If you absolutely must miss a class, or be late, or leave early,
please inform me in advance.
Cell phones, PDA’s, etc. should be turned off during class. NOTE: A growing body of empirical
evidence based on experiments at universities in the U.S. and Canada shows that students learn less and
earn lower grades when they use computers or tablets in class. In addition, the study results indicate that
the learning and grades of students sitting near computer users also suffer.
Course Requirements
In addition to the readings, midterm and final exams, regular class attendance and participation, students
will complete two assignments.
At least for one of the assignments students will divide up into study groups of 3-4 students. Study
groups should form in the first class and be diverse in terms of gender, nationality and ethnicity. Hand
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me a sheet of paper at the end of the first class with the full names of the group members clearly printed.
Indicate (M) for male and (F) for female after each name. I reserve the right to reassign students to
different study groups in order to enhance group diversity.
1. Problems relevant to the class material are embedded in each week’s lecture slides. You are
required to solve the problems on your own or with your study group. You are encouraged to bring any
questions you may have about the problems to class the following week. Your solutions to the problems
will not be collected; however, I may call on students in the following week’s class to provide the
solutions. Solutions to the problems will be posted on Blackboard, Documents, after we have discussed
them in class.
NOTE: The midterm and final exams will consist largely of very similar problems to those in the slides.
If you do not work out the problems and understand the theory that underlies them, experience has
shown that you will not perform well on the midterm and final exams.
Study questions are provided in some of the slides to emphasize important material that may not be
covered fully by the problems. You are encouraged to use them to help you learn the material at a high
level. They are not a substitute for the problems, and are provided to help guide your studying and exam
preparation. Solutions to the study questions will not be provided.
2. A group PowerPoint Presentation on a topic selected by the study group from a list of topics
provided below. Since topics are on a first come, first served basis, each study group, once officially
approved by me, should send me their first and second choice topics via email no later than the third
class session. Please include all group member email addresses in the “copy” space so that everyone
receives my reply at the same time. I will assign each study group a presentation date consistent with the
material covered in the course. No written report is required. Another group will be assigned to prepare
questions and begin the Q&A for each presentation.
A set of guidelines for preparing your presentation and questions is posted on Blackboard, Documents.
Everyone is required to read the guidelines so that you are aware of deadline dates and expectations for
the assignment.
Choose one of the following topics. If you have another topic in mind, please suggest it to me as soon
as possible for authorization to proceed. You are welcome to discuss topics with me at any time prior to
the topic due date, and presentation content any time prior to the presentation date.
- What accounts for the differences in productivity growth rates between the US and Europe?
- Is China’s current account surplus sustainable?
- What would happen if China allowed the yuan to float freely?
- Is the large US current account deficit a concern?
- Is it time for a change in the Euro-zone fiscal policy model?
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- What were the causes and consequences of the global financial crisis of 2007?
- What were the causes and consequences of the Asian financial crisis in the late 1990’s?
- What were the causes and consequences of the “0” Bound issue in Japan?
Grading
Group Presentation: 30%
Midterm exam: 30%
Final exam: 40%
Grading Scale: 95 – 100: A
90 – 94: A87 – 89: B+
83 – 86: B
80 – 82: B75 – 79: C+
70 – 74: C
< 70: F
Since it is important to integrate what you learn and be able to express it effectively, students are
expected to participate actively in class by engaging in discussions and raising relevant and thoughtful
questions. Attendance is not class participation.
Lack of answers to homework problems can result in a diminution of your grade.
Multiple absences from class, chronic lateness, and leaving class early without explanations can also
affect your grade.
Exams are designed to assess your knowledge of economic concepts and tools, and your ability to
choose and apply them to real world issues.
You are responsible for checking the midterm exam date in the outline and avoiding any conflict with
other commitments. A student with an extraordinary situation, such as a certified serious illness, may
arrange prior to the scheduled final exam date to take a make-up final on the deferred exam date
designated by the school.
With the exception of certified serious illness, no drops or withdrawals will be approved after the last
day to officially drop a course. Please refer to the University’s academic calendar for information on
deadlines for dropping courses.
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Blackboard and Pace Email
Check the Blackboard site for this course and your Pace email account regularly for course information,
documents, assignments and communications. PowerPoint slides for each lecture will be posted
approximately 24 hours prior to each class session.
Web Support
Free sources for economic data and research include:
Federal Reserve Bank of St. Louis, FRED: price indexes, employment, banking, reserves, exchange
rates, interest rates, monetary aggregates, trade – www.research.stlouisfed.org/fred2
Federal Reserve Board: monetary policy, tools, and reports – www.federalreserve.gov
New York Federal Reserve Bank: monetary and foreign exchange data – www.ny.frb.org
Bureau of Labor Statistics: price indexes, earnings, unemployment, productivity – www.bls.gov
Bureau of Economic Analysis: national income and product accounts, trade, balance of payments data –
www.bea.gov
US Treasury: bond rates, yield curve rates, US economic statistics – www.treasury.gov
Economic Report of the President: US economic statistics – www.gpoaccess.gov/eop/index.html
National Bureau of Economic Research: business cycles – www.nber.org
Census Bureau: economic indicators eg. construction spending, housing starts and sales, income,
population – www.census.gov
CIA World Factbook: country data – www.cia.gov
Conference Board: consumer confidence index, leading indicators – www.conference-board.org
Economagic: data compilations from Fed, Census, BLS, Commerce, international sources (subscription
needed for advanced searches) – www.economagic.com
Wall Street Journal Markets Data Center: current and recent financial information, stocks, bonds,
commodities, futures, interest rates, foreign exchange – www.wsj.com
Academic Resources
Information on academic resources, courses, and more is available on the Lubin School’s website:
www.pace.edu/lubin. Academic advising is available through the Lubin School’s Office of Graduate
Academic Advisement and Student Development: 212-618-6440.
Academic Integrity Code
Students in this course are required to adhere to Pace University's
Academic Integrity Code. The
Academic Integrity Code supports honesty and ethical conduct in the educational process. It educates
students about what constitutes academic misconduct, helps to deter cheating and plagiarism, and
provides a procedure for handling cases of academic misconduct. Students
are expected to be familiar
with the Code, which can be found under "University Policies" in the Student Handbook. Individual
schools and programs may have additional
standards of academic integrity. Students are responsible
for familiarizing themselves with the policies of the schools, programs, and courses in which they are
enrolled.
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Students with Disabilities
The University’s commitment to equal educational opportunities for students with disabilities includes
providing reasonable accommodations for the needs of students with disabilities. To request an
accommodation for a qualifying disability, a student must self-identify and register with the Coordinator
of Disability Services for his or her campus. No one, including faculty, is authorized to evaluate the
need and arrange for an accommodation except the Coordinator of Disability Services. Moreover, no
one, including faculty, is authorized to contact the Coordinator of Disability Services on behalf of a
student. For further information, please see Information for Students with Disabilities on the
University’s website.
Course Outline (Omit text appendices except where noted)
Class 1: Macroeconomics, Scarcity and Choice, Demand and Supply
BB: Ch. 1 (+ Appendix pp. 12-15), 2, 3, 4 (55–70)
Groups Formed
Class 2: Market Intervention, GDP, and Unemployment
BB: Ch. 4 (pp.71-76), 5, 6 (101-112)
Murat Tasci and Mary Zenker, Labor Market Rigidity, Unemployment, and the Great Recession,
Federal Reserve Bank of Cleveland, Economic Commentary, No. 2011-11, June 29, 2011.
Class 3: Inflation, Business Cycles, Economic Growth, and Productivity
BB: Ch. 6 (pp. 113-121 + Appendix), 7
Jake Fabina, Where Has All the Productivity Growth Gone?, Federal Reserve Bank of Chicago, Chicago
Fed Letter, No. 306, January 2013.
Presentation Topics Due
Class 4: National Income Accounts and Income Determination
BB: Ch. 8 + Appendix, 9 (169-174)
Class 5: Elasticity, Globalization and International Trade
BB: Ch. 18 + Appendix
Class 6: International Monetary System
BB: Ch. 19
Galina Hale, Balance of Payments in the European Periphery, Federal Reserve Bank of San
Francisco, Economic Letter, No. 2013-01, January 14, 2013.
Class 7: Midterm Exam – material from classes 1 through 6 (October 11)
Class 8: AD, AS, and Equilibrium; Expenditure Multiplier
BB: Ch.1 (p. 16), 9 (174 - 186), 10, 20 (399 – 404)
Class 9: Fiscal Policy
BB: Ch. 11 (215-223) + Appendix A, 20 (404-405)
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Class 10: Supply Side Management, Phillips Curve; Introduction to Money and the Fed
BB: Ch. 11 (223-226), Ch. 12 (235 - 242), Ch. 13 (259 - 263), 17 (335 - 340)
Mary C. Daly, Bart Hobijn, and Timothy Ni, The Path of Wage Growth and Unemployment, Federal
Reserve Bank of San Francisco, Economic Letter, No. 2013-20, July 15, 2013.
Class 11: Banking and Monetary Policy
BB: Ch. 12 (242 - 255), 13 (263 - 271), 20 (406)
Early Elias and Oscar Jorda, Crises Before and After the Creation of the Fed, Federal Reserve
Bank of San Francisco, Economic Letter, No. 2013-13, May 6, 2013.
Class 12: Monetary Policy in the Macro Model; Monetarism
BB: Ch. 13 (271 - 276), 15 (295 - 307)
Julia Bevilaqua and Fernanda Nechio, Fed Policy Liftoff and Emerging Markets, Federal Reserve Bank
of San Francisco, July 18, 2016.
Class 13: Monetary Policy: M vs.i; Debt and Deficits; Policy Coordination
BB: Ch. 15 (307 - 312), 16, 20 (406)
Class 14: Final Exam – material from classes 8 through 13 (December 13)
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