discuss a macroeconomic stabilization policy

discuss a macroeconomic stabilization policy

As specified in the Course Syllabus, 15% of your grade is based on a country-report paper. The main guideline is to apply any topic learned in class to a real macroeconomic situation in a country of your choosing. Usually, most students find it easy to discuss a macroeconomic stabilization policy (based on the IS-LM or Mundell-Fleming frameworks). However, if you decide to focus on growth (Solow growth model) that should work just as well. The example below will be based on stabilization policies. This is an outline for your paper:

1. Introduction: This is an executive summary for your paper. Explain which country you picked, what macroeconomic crisis (shock to AD, shock to AS…) and what stabilization policy was adopted (expansionary/contractionary Fiscal/Monetary…). Briefly anticipate your conclusions as well. (1-2 pages)
2. Body: Organize the details of your research and analysis as follows:
3. Background: Any descriptive statistics about your country that are relevant to your paper. Do not go into irrelevant data, just because you found it available online. (1-2 pages)
4. Macroeconomic Shock: Describe what happened (Financial Crisis, 2008 recession, Contagion from another country…) and how your country was affected (recession drop of x% for y quarters, inflation problems, depreciation of the currency, unemployment went up by z points…). (1-2 pages)
5. Stabilization Policy: Explain what macroeconomic policies, if any, were put in place in response to the shock you just described (Monetary expansionary/contractionary, Fiscal expansionary/contractionary, Exchange rate devaluation…). (1-2 pages)
6. Macroeconomic Assessment: give your judgement based on what you have learned in class. This is where you can show me that you are able to apply the theoretical lessons to something you have seen in current events. You might agree with the policies adopted or not. (1-2 pages)
7. Conclusion: Summarize your paper thesis, your findings and your results. Here you can expand on what your assessment is. (1 page)
8. References: Cite any relevant source you used to prepare your paper. (1 page)

As you can tell by the approximate page numbers for each section, I expect about 8-12 pages of work. It might be more, especially if you use several graphs, but remember that I don’t grade on length or weight, but on content. This is what I look for:

• Be concise and make your points in a direct manner.
• Use graphs to tell your story, but do not cut and paste graphs from other sources. Collect raw data and prepare your own graphs.
• I will grade down for sloppy presentation. This should be like a presentation you do for work. Graphs need to be neat, citing data source.
• Keep it simple. You do not need to talk about everything that happen to your country. Stick to one story to get an A. You can compare two different episodes for the same country, or the experience of two different countries, as long as it is relevant to your story.

DUE DATE: Papers will be due on the day of your final  and must be submitted electronically via email to me and the TA. Make sure to name your paper as follows: ECON305_YourLastName_YourFirstName. Do not send a paper called “final paper” or any other generic names, because I will end up losing it in my files and if I don’t read it you won’t receive a grade. Also, make sure to name the subject of your email: ECON305_YourLastName_YourFirstName, so I won’t lose your email in my mailbox.