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2020/2021  KAN-CMECV1248U  Monetary Policy

English Title
Monetary Policy

Course information

Language English
Course ECTS 7.5 ECTS
Type Elective
Level Full Degree Master
Duration One Semester
Start time of the course Spring
Timetable Course schedule will be posted at calendar.cbs.dk
Max. participants 50
Study board
Study Board for HA/cand.merc. i erhvervsøkonomi og matematik, MSc
Course coordinator
  • Mauricio Prado - Department of Economics (ECON)
Main academic disciplines
  • Economics
Teaching methods
  • Face-to-face teaching
Last updated on 16/04/2021

Relevant links

Learning objectives
  • explain the different models of monetary policy and their assumptions
  • use the models presented in the course to explain the effects of different monetary policies and shocks on the economy
Course prerequisites
It is advisable for the students to have taken a macroeconomics course prior to this elective
Monetary Policy:
Exam ECTS 7.5
Examination form Home assignment - written product
Individual or group exam Individual exam
Size of written product Please see text below
4 hour written home assignment with no page max
Assignment type Written assignment
Duration Written product to be submitted on specified date and time.
Grading scale 7-point grading scale
Examiner(s) One internal examiner
Exam period Summer
Make-up exam/re-exam
Same examination form as the ordinary exam
Same examination form as the ordinary exam
If the number of registered candidates for the make-up examination/re-take examination warrants that it may most appropriately be held as an oral examination, the programme office will inform the students that the make-up examination/re-take examination will be held as an oral examination instead
Course content, structure and pedagogical approach

The course provides an overview of models in monetary economics, with a special emphasis on New Keynesian models and their implications for monetary policy.




  • Classical Monetary Model 
  • The Basic New Keynesian Model
  • Monetary Policy Design in the Baseline Model
  • Monetary Policy Tradeoffs: Discretion versus Commitment
  • A Model with Sticky Wages and Prices
  • Unemployment in the New Keynesian Model
  • Monetary Policy in the Open Economy
  • Lessons, Extensions, New Directions
Description of the teaching methods
The course is composed of 10 weekly three-hour classes. These class activities will involve derivation and analysis of models.
Feedback during the teaching period
During some of the lectures, we will solve exercises in class, where there will be opportunities for providing feedback to the students. Moreover, students will be able to receive feedback during regular office hours.
Student workload
Lectures 30 hours
Preparation / exam 176 hours
Expected literature

Jordi Gali (2015): Monetary Policy, Inflation and the Business Cycle. An Introduction to the New Keynesian Framework, Princeton University Press (Princeton, NJ), ISBN: 9780691164786


Further recommended readings and journal articles will be posted on Canvas 

Last updated on 16/04/2021