Empirical analysis of dynamic macroeconomic models

The dynamic stochastic general equilibrium (DSGE) model is a widely used standard model in modern macroeconomic analysis. The model is based on solid microeconomic foundations and incorporates dynamic decisions made by consumers and firms. For example, in the New Keynesian model, firm’s price setting behavior and price rigidity often play a crucial role on the effectiveness of central bank’s monetary policy. For this reason, measuring the speed of price adjustment of individual goods at the micro level and investigating its aggregate implication are important empirical topics. In the course, we learn the methods of estimating the DSGE model from economic data. Motivated undergraduate students are also welcome.