Course

Unit 1

Unit I Modern Monetary Policy & Central Banking Overview of monetary policy goals and tools. Main channels of transmission. Forecasting with quarterly projection models for policy decisions. Frontier topics: heterogenous-agent DSGE and distributional effects of monetary policy.

Unit 2

Unit II Culture, Institutions & Economic Development How cultural norms and institutional arrangements influence long-run growth. Concepts, measurement challenges and broad empirical strategies. Contemporary modelling approaches and current debates.

Unit 3

Unit III Applied Econometric Analysis & Instrumental-Variable Methods Essentials of causal inference and endogeneity. Instrumental-variable techniques and diagnostics. Guided walk-through of an influential study applying econometric techniques, focused on its framing, structure, argument flow and writing choices.

Unit 4

Unit IV Innovation and Technological Change – Theories of Innovation and Technological Change; National Innovation Systems and Developmental States; Measuring Innovation and Evaluating Policy Impact

Unit 5

Unit V International Economics Core ideas in trade, finance and open-economy macro. Gains from trade: Ricardian, HeckscherOhlin and New Trade models. Exchange-rate issues, global shocks and the role of international institutions. Emerging topics in economic integration.

Text Books / References

• Krugman, P. R. (2008). International economics: Theory and policy, 8/E. Pearson Education India.
• Nelson, R. R. (1987). Understanding technical change as an evolutionary process: Inside the black box. In The political economy of science, technology and innovation.
• Lundvall, B. Å. (1992). National systems of innovation: Towards a theory of innovation and interactive learning. Pinter.
• Rosenberg, N. (1982). Inside the black box: Technology and economics. Cambridge University Press.
• Enke, B. (2019). Kinship, cooperation, and the evolution of moral systems. The Quarterly Journal of Economics, 134(2), 953–1019. https://doi.org/10.1093/qje/qjz001
• Algan, Y., & Cahuc, P. (2014). Trust, growth, and well-being: New evidence and policy implications. In P. Aghion & S. N. Durlauf (Eds.), Handbook of Economic Growth (Vol. 2, pp. 49–120). Elsevier.
• Acemoglu, D., & Robinson, J. A. (2021). Culture, institutions and social equilibria: A framework. NBER Working Paper No. 28832.
• Henrich, J. (2020). The weirdest people in the world: How the West became psychologically peculiar and particularly prosperous. Penguin UK.
• Giuliano, P., & Nunn, N. (2018). Ancestral characteristics of modern populations. Economic History of Developing Regions, 33(1), 1–17. https://doi.org/10.1080/20780389.2018.1435267
• Belke, A., & Polleit, T. (2010). Monetary economics in globalised financial markets (Ch. 6). Springer Science & Business Media.
• Blanchard, O. J., & Fischer, S. (1989). Lectures on macroeconomics. MIT Press.
• Cecchetti, S. G., & Schoenholtz, K. L. (2017). Money, banking, and financial markets (4th ed., Chs. 20–21). McGraw-Hill Education.
• Campante, F. R., Sturzenegger, F., & Velasco, A. (2021). Advanced macroeconomics: An easy guide. Princeton University Press.
• Galí, J. (2008). Monetary policy, inflation, and the business cycle: An introduction to the New Keynesian framework. Princeton University Press.

Reference Books:

• Romer, D. (2019). Advanced macroeconomics (5th ed.). McGraw-Hill Education.
• Greene, W. H. (2000). Econometric analysis 4th edition. International edition, New Jersey: Prentice Hall, 201- 215.
• Angrist, J. D., & Pischke, J. S. (2009). Mostly harmless econometrics: An empiricist’s companion. Princeton university press.

Prerequisite: Research Methods I & II, Economics for Public Policy Summary: This course offers an introduction to contemporary empirical and theoretical tools used in economic research and policy analysis. Through selected readings and guided discussions, students explore frontier work in macro-, institutional, and international economics and examine how influential papers are structured and argued. The aim is to help participants: understand the motivation and methods behind current studies, gain practical experience with key modelling and identification techniques, and practise communicating research insights to policy-oriented audiences. While the course highlights advanced approaches, the emphasis is on developing a working familiarity rather than full mastery, giving students a foundation they can build on in their own research projects.

Course Objectives:

1. To introduce students to the goals, instruments, and transmission mechanisms of modern monetary policy, with an emphasis on emerging techniques such as heterogeneous-agent DSGE models.
2. To explore how cultural norms and institutional structures influence economic development and long-run growth trajectories.
3. To build analytical skills in causal inference using econometric techniques, with a focus on identifying and addressing endogeneity.
4. To understand key frameworks for analyzing innovation, the role of national innovation systems, and methods for evaluating the impact of innovation policies.
5. To familiarize students with foundational and contemporary models of international trade and finance, and the institutional context of global economic integration.

Course Outcomes:

CO1: Analyze and interpret the goals, instruments, and distributional impacts of modern monetary policy using both traditional and heterogeneous-agent macroeconomic models.

CO2: Evaluate the role of cultural norms and institutional structures in shaping long-term economic development using theoretical and empirical frameworks.

CO3: Identify causal relationships in economic data and critically assess applied econometric research.

CO4: Assess national innovation systems and evaluate innovation policy using appropriate theoretical frameworks and empirical indicators.

CO5: Interpret international trade and finance dynamics using classical and modern models, and assess the role of global institutions and shocks in shaping open-economy outcomes.

Skills:

• Macroeconomic Modelling: Ability to critically evaluate modern central banking models, including DSGE frameworks, to assess monetary policy and its distributional consequences.

Institutional Analysis: Skills to evaluate how cultural norms and institutional arrangements impact economic performance across contexts.

Econometric Inference: Capacity to use causal inference techniques to conduct and critique applied economic research.

• Innovation Policy Evaluation: Capacity to assess technological change, national innovation systems, and the effectiveness of related policy interventions.

• International Policy Analysis: Competence in analyzing trade models, exchange-rate dynamics, and the influence of global institutions on national economic policy.

Program outcome PO – Course Outcomes CO Mapping

Program Specific Outcomes PSO – Course Objectives – Mapping