Modelling the Australian Macroeconomy (ECOM40005)

Intended learning outcomes

On successful completion of this subject students should be able to:

• Specify and estimate VAR/SVAR models;
• Generate and understand impulse response functions and forecast error variance decompositions;
• Understand alternative identification strategies and apply them to identify monetary policy shocks, fiscal shocks and technology shocks;
• Specify a basic New Keynesian model; generalise it for a small open economy as well as other commonly included extensions in empirical applications;
• Apply econometrics methods (Generalized Method of Moments and the Kalman filter) commonly used to estimate DSGE models;
• Analyse policies by simulating DSGE models;
• Understand the relevance of optimal and unconventional policies;
• Evaluate recent central bank and academic research using VAR/SVAR and small-open economy DSGE models.

Generic skills

• High level of development: statistical reasoning; application of theory to practice; interpretation and analysis; critical thinking; synthesis of data and other information; receptiveness to alternative ideas.
  
• Moderate level of development: oral communication; written communication; collaborative learning; problem solving; evaluation of data and other information; use of computer software.
  
• Some level of development: team work; accessing data and other information from a range of sources.