How do you teach intermediate/advanced undergraduate macroeconomics? Do you use theory, practice, or some hybrid?

Question

My colleagues and I often discuss what and what is not appropriate when teaching intermediate/advanced undergraduate macroeconomics. It seems that there are such varying opinions. Some seem to strictly adhere to presenting models and results, while others focus on fiscal and monetary policy discussions.  I wanted to see the general consensus among academics.

Answer 1

As background, I teach at a community college where Macro and Micro are courses that transfer straight across to four year institutions.  These two courses also satisfy the social science requirement as part of the core general education requirements to achieve an AS or AA degree.  Lastly, I am at an institution where students that "major/focus" in a particular discipline do not actually have to take the courses recommended by the program.  In essence all students complete a selection of core courses amounting to 30 hours.  The remaining 30 hours are in essence purely elective.  My state also requires that the AA and AS are 60 credit hours, not 64.  This means that I am teaching to multiple audiences.  This also means that my response is strictly speaking to the intermediate undergrad econ (Econ101 does not transfer to many state institutions in my state).

That said, I focus on presenting models and emphasizing positive economics.  I also address fiscal and monetary policy - but absolutely separate from the discussions of Keynesian or Monetary Theories or the Banking unit.  I do this because the pedagogy of many texts try to present an "application of fiscal policy or monetary policy" weaved into the theoretical macro theories.  In my experience (almost 40 years) students confuse the application/policy from the theory when these concepts are weaved together.  I do also use some policy discussion, but only after the theories are presented and sufficiently understood.  Otherwise, students do not make the economic "why" connection to particular policies.  In addition, I am very careful not to suggest normative decisions are "right" or "wrong".  Instead, I encourage students to cite the economic theory, and their choices relating to opportunity costs as a means to crouch normative judgments.  

At the tail end of the course, I do engage in a student discussion of which Macro Theory do they think is "best".  They must cite specific components macroeconomic models that support their case.  They often discover that how they rank assumptions behind the economy (ie: demand driven or supply driven, short run or long run) drive which models they believe work best.

Answer 2

You need to do some models, and some policy, but also some business implications. Most students will not be policy-makers, but most of them will work in organizations that are affected by the macroeconomy: private business, non-profits, state and local governments. Teaching them how business cycles impact organizations will be more useful than coaching them on how to run monetary or fiscal policy.

Answer 3

Hello, short answer is teaching with data (in the U.S., BEA, BLS, and Fed -- via FRED where available) so that it is more real, tangible, practical to students. What connects most easily with students varies, this practical, data method seems to work best with students who are:
* Consumers in every-day life so are buying lots of stuff so can easily identify with data for tangible products
* Naturally analytical
* Exposed to data analytics methods from outside of economics
* Learning systems methods from other courses (whether business, political science polling, biology, or more)
* Being encouraged by you to go into graduate students as the AEA is promoting (I did in a grad program)
It also creates the opportunity to help students learn engaging data visualization software (Excel data animations, Tableau) that are popular.
Hope this helps.

Answer 4

In general, what I have seen is that the structure of intermediate  macroeconomics courses depend on the type of students one teaches, also somewhat on the personal interests of the instructor.

At my department which is at a large public research university that does not have very competitive admissions an intermedaite macroeconomics course would develop a graphical model like the  AD-AS IS-MP model. Than use that one model to analyze many different issues  (i.e. the impact of some shock or policy) on different areas economy (i.e. labor market, gdp etc.)

However, I also know at more competitive universities (particularly ones with strong macroeconomics traditions, where undergraduates know courses) and undergrad intermediate/advanced macroeconomics course  might focus more on modern macroeconomic theory and try to develop a two period model and study a broad range of policy through the lenses of this model, gradually increasing complexity. Some may also present additional models like growth models etc.

I think though at most departments an upper level macroeconomics course is generally geared towards economics majors and people who self-selected  into the course because of some preference to understand economics through the lens of economic theory. So there is usually a lot more emphasis on theory in these courses in general.

Comments

I am probably an outlier here.  Because I was "trained" as an economic historian, I always taught Intermediate Macroeconomics as a history of the US macro-economy beginning with the "Keynesian celebration" of the "successful" 1960s, using the Monetarist counter-arguments to explain stagflation in the 1970s and the monetarist experiment of 1979-1981 -- I would then turn to supply side economics and the Reagan Revolution of the 1980s --- and finally to the demonization of deficit spending in the 1990s and the so-called "new economy" as heralded by the Clinton Administration's final Economic Report.    I finished up with an analysis of the Bush (II) Administration's policies and the arguments for and against -- (I taught macro for the last time in 2011)

Along the way, the students learned Keynesian approaches, monetarist approaches, supply side economics, -- even radical secular stagnationist arguments -- and the celebrations of both Greenspan as a maestro and "Rubinism" --- the brief achievement of "fiscal responsibility" --- and competing explanations for the Great Recession as well as the arguments about the Obama Administration's policies ...

Having students read at least one or two chapters from various Economic Reports of the President as well as classics like Friedman's AEA PResidential address was very important ...

Given my students' abilities, I gave them very little in the way of models beyond IS-LM --- but this could vary depending on how much math the students are required to  know before they take the course --- the crucial point for me was to ground whatever theory they were learning in concrete data and arguments in real time from policy-makers ---

Most of these students will not go on to major in economics or to use economics in their professional lives -- but they will all be citizens.   I have always accepted the admonition of the late Joan Robinson that the most important reason to study economics was so one would not (in one's capacity as a citizen) be MISLED by economists (she always was rude to her fellow professionals!).