ECON 473 - Open Economy Macroeconomics

Fact 1: All countries on the planet are open to trade (yes, even Cuba or North Korea). Fact 2: Macroeconomics typically ignores Fact 1 and assumes a closed economy when offered at a basic or intermediate level. Fact 3: The only closed economy is planet Earth. Fact 4: The difference between how a closed economy works vis-a-vis an open economy is huge. Fact 5: Phrases like “the trade balance deficit/current account worsened” are thrown around in the media (often in a fearmongering fashion) without enough context nor background information for the public to understand what’s going on. This course takes these facts seriously and aims to complement and expand the macroeconomic foundations from ECON 371 by “opening up” the economy. We will study the canonical open economy models (theory) and see how these do when compared to the real world (practice). This course counts as a Group E elective. Meets concurrently with ECON 474. Prerequisite(s): ECON 371 and ECON 381, earned with grades of C- or higher. Alternate years. (4 Credits)