Advanced Macroeconomic Analysis II (2025)

In recent years, monetary and fiscal policy have been at the centre of most political debates. The 2019 pandemic prompted central banks to cut their interest rates quickly, drawing on the lessons of the Great Financial Crisis. At the same time, many governments launched huge stimulus packages, leaving many economies with high levels of public debt. In times of low interest rates, high public debt is of little concern to (fiscal) policymakers. The invasion of Ukraine led to a surge in energy prices and thus inflation. Central banks responded by raising interest rates again to fight inflation. This action could have consequences for fiscal policy - and, as the course will show, for monetary policy as well. In this course, we begin by discussing the reasons why monetary and fiscal policymakers have reacted as they have in recent years. To this end, we will identify monetary and fiscal policy shocks and discuss their effects and transmission in the economy. Finally, we will show how they are linked and how they interact.

Seminar on Monetary Theory (2024/25)

What turns an ordinary piece of paper or digital bits into money? What role does it play in the economy and why is it valuable? And above all: how is its value determined? To answer these questions, the seminar introduces and compares three theories of the value of money — the Quantity Theory, the Fiscal Theory of the Price Level (FTPL), and Modern Monetary Theory (MMT). Each theory is presented by a student team and then tested against historical episodes of inflation and deflation, from the German hyperinflation of the 1920s and the Great Depression to the zero lower bound after the financial crisis and the 2022 inflation surge.