Monetary and Fiscal Policy
Fall 2019
Jeffrey Parker, Reed College
Class Policy Project
The policy project for this semester will involve four groups of four students each exploring the macroconomic setting of one country and making detailed recommendations for monetary and fiscal policy. Your analysis and recommendations are to be presented in a report (due on Friday, December 6) and presentation (in class on December 9 or 11).
The macroeconomic analysis should focus on the economy's current situation with respect to output growth, labor markets, inflation, external balance, investment in future capacity, and financial markets (and any other features that are particular to your country, such as a leading industry). Tables and graphs are likely to be a good way to present some aspects of the macroeconomic setting. The policy recommendation should be for a specific monetary policy (interest rate target or growth rate of a monetary aggregate) and fiscal policy measures such as tax changes or changes in spending on specific categories of expenditure. All policy recommendations must be well grounded economic theory in response to the macroeconomic situation you have described.
Countries can be chosen from the following list, which excludes the United States, the Euro Zone (no national monetary policy), China (too much government control), and countries like Canada, Sweden, and Australia (too stable):
- Japan
- South Korea
- United Kingdom (shouldn't it be United Queendom after 65+ years?)
- Mexico
- Argentina
- Brazil
- Chile
Each of these countries has unique characteristics that make its current situation interesting, so your analysis will need to be more than just a dry recitation of macro data.
Please send the instructor your preferences about what country you'd like to study and any partners with whom you'd like to work by email no later than Friday, November 1. Groups will be assigned shortly thereafter.
I plan to meet with each group twice during the research process to assess where you are and offer suggestions. One of these meetings will occur near the beginning of the process and one near the end.