Thomas Winberry

Thomas Winberry
Assistant Professor of Finance, The Wharton School

  Wharton FNCE 6130: Macroeconomics and the Global Environment

This course is an advanced introduction to macroeconomics for MBAs. We will study the aggregate behavior of individuals, households, and firms, and emphasize why this behavior is important for those pursuing careers in business. The applied focus of the course, particularly to the broad business environment, makes it of value even to those students who have taken an intermediate macroeconomics course as an undergraduate, or to students who are considering taking an undergraduate course instead. This course serves as a recommended pre-requisite for most of the advanced business enviornment courses.

Particular topics include: an anlysis of the determinants of GDP (consumption, investment, government spending, and the foreign sector); the determination of inflation, unemployment, interest rates, and exchange rates; the implementation of the effects of monetary and fiscal policy; and the role of technology in economic growth. Throughout, we will focus on the extent to which government policy can or should affect macroeconomic outcomes. Particular examples of policy analysis include: the persistent decline in employment rates during the last decade, minimum wage laws, immigration policy, social security reform, recent Federal reserve policy, income and wealth inequality, federal and state fiscal deficits, the role of taxes in determining labor supply decisions, and why the European monetary union is more fragile than the US monetary union across states.

Chicago Econ 38001 / Booth 33942: Micro Data for Macro Models

(Co-taught with Rohan Kekre) There is tremendous heterogeneity across firms at the micro level; even within narrowly defined sectors, firms vary a lot in their productivity, investment, hiring, and other variables. This part of the course is designed to introduce you to these facts and assess their implications for macroeconomic outcomes. We will emphasize the interaction between empirical evidence – which tells us how firms behave – and quantitative, heterogeneous agent macro models – which tells us how to map that behavior into macroeconomic outcomes. A key question throughout the course is: how does firm heterogeneity change our understanding of the dynamics of aggregate variables, relative to the predictions of representative agent models? We will discuss two broad answers to this question:

1. The dynamics of aggregate variables depend on the entire distribution of heterogeneous firms, which cannot be captured in a representative agent framework.

2. Cross-sectional or panel micro data provides direct evidence on how firms make decisions, and therefore provide valuable information for estimating model parameters not included in aggregate time series data.

Course Background
Syllabus for entire course
Reading List for my half
Guidelines for presentations

Computational Background Material
Introduction to Matlab notes
Introduction to Matlab practice problem
Dynare codes for RBC model

Lecture Slides
Topic 0: Course Intro and Representative Agent Macroeconomics
Topic 1: Productivity Dispersion, Aggregation, and Misallocation
Topic 2: Capital Investment and Adjustment Costs
Topic 3: Financial Frictions and Investment
Topic 4: Firm Lifecycle
Topic 5: Trends in Concentration, Competition, and Markups

Homework 1: Estimating productivity in Compustat
Homework 2: Solving steady state fixed cost model

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