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Identifies major advances in the study of macroeconomics, including work on alternative approaches and models spawned by the recent financial crisis

Table of Contents

Section 1: The Facts of Economic Growth and Economic Fluctuation 1. RBC Methodology and the Development of Aggregate Economic Theory 2. The Facts of Economic Growth 3. Macroeconomic Shocks and Their Propagation 4. Macroeconomic Regimes and Regime Shifts 5. The Macroeconomics of Time Allocation 6. Who Bears the Cost of Recessions? The Role of House Prices and Household Debt 7. Allocative and Remitted Wages: New Facts and Challenges for Keynesian Models 8. Financial and Fiscal Crises

Section 2: The Methodology of Macroeconomics 9. Factor Models and Structural Vector Autoregressions in Macroeconomics 10. Solution and Estimation Methods for DSGE Models 11. Recursive Contracts and Endogenously Incomplete Markets 12. Macroeconomics and Household Heterogeneity 13. Natural Experiments in Macroeconomics 14. Accounting for Business Cycles 15. Incomplete Information in Macroeconomics: Accommodating Frictions in Coordination 16. New Methods for Macro-Financial Model Comparison and Policy Analysis

Section 3: Financial-Real Connections 17. Wholesale Banking and Bank Runs in Macroeconomic Modelling of Financial Crises 18. Housing and Credit Markets: Bubbles and Crashes 19. Macro, Money and Finance: A Continuous-Time Approach 20. Housing and Macroeconomics 21. Term Structure of Uncertainty in the Macroeconomy 22. Quantitative Models of Sovereign Debt Crises

Section 4: Models of Economic Growth and Fluctuations 23. Families in Macroeconomics 24. Environmental Macroeconomics  25. The Staying Power of Staggered Wage and Price Setting Models in Macroeconomics 26. Neoclassical Models in Macroeconomics 27. Macroeconomics of Persistent Slumps 28. Macroeconomics and the Labor Market

Section 5: Macroeconomic Policy 29. Challenges for Central Banks?Macro Models 30. Liquidity requirements, liquidity choice and financial stability 31. Understanding Inflation as a Joint Monetary-Fiscal Phenomenon 32. Fiscal Multipliers: Liquidity Traps and Currency Unions 33. What is a Sustainable Public Debt? 34. The Political Economy of Government Debt

About the Author

John B. Taylor is the Mary and Robert Raymond Professor of Economics at Stanford University and the George P. Shultz Senior Fellow in Economics at Stanford’s Hoover Institution. He is also the director of Stanford's Introductory Economics Center. His research focuses on macroeconomics, monetary economics and international economics. He co-edited Volume 1 of the Handbook of Macroeconomics and recently wrote Getting Off Track, one of the first books on the financial crisis, and First Principles: Five Keys to Restoring America’s Prosperity. He served as senior economist and Member of the President’s Council of Economic Advisers. From 2001 to 2005, he served as undersecretary of the U.S. Treasury for international affairs. Taylor was awarded the Hoagland Prize and the Rhodes Prize by Stanford University for excellence in undergraduate teaching and the Stanford Economics Department Distinguished Faculty Teaching Award. He received the Truman Medal for Economic Policy for extraordinary contribution to the formation and conduct of economic policy, the Bradley Prize for his economic research and policy achievements, the Adam Smith Award from the National Association for Business Economics, the Alexander Hamilton Award and the Treasury Distinguished Service Award for his policy contributions at the US Treasury, and the Medal of the Republic of Uruguay for his work in resolving the 2002 financial crisis. Taylor received a BA in economics summa cum laude from Princeton and a PhD in economics from Stanford. Harald Uhlig, born 1961, is Professor at the Department of Economics of the University of Chicago since 2007, and was chairman of that department from 2009 to 2012. Previously, he held positions at Princeton, Tilburg University and the Humboldt Universität Berlin. His research interests are in quantitative macroeconomics, financial markets and Bayesian econometrics. He served as co-editor of Econometrica from 2006 to 2010 and as editor of the Journal of Political Economy since 2012 (head editor since 2013). He is a consultant of the Bundesbank, the European Central Bank and the Federal Reserve Bank of Chicago. He is a fellow of the Econometric Society and a recipient of the Gossen Preis of the Verein für Socialpolitik, awarded annually to an economist in the German-language area whose work has gained an international reputation.

Reviews

"Macro is moving fast, partly because of technological progress and new data, partly because of the intellectual shocks triggered by the crisis. This handbook, like its predecessors, gives us the current state of the arts." --Olivier Blanchard, Massachusetts Institute of Technology

"The new volumes in the Handbook of Macroeconomics illustrates both the richness and the enormous breadth of modern research in macroeconomics. The chapters offer in depth surveys of critical areas, new empirical results to guide future researchers, analytical and computational tools for addressing macroeconomic issues, and examples of how these tools can be applied to advance our understanding of aggregate economic behavior. These volumes constitute an important resource for all macroeconomists, one that is certain to be widely used." --Carl E. Walsh, University of California, Santa Cruz

"This Handbook is the ideal starting point to get up to speed quickly on any major topic in Macroeconomics: What we have learned and what are the most pressing open questions." --Pete Klenow, Stanford University

"This remarkable collection belies uninformed critics who assert that modern macroeconomics was wrong footed by the 2007-2009 financial crisis.  Articles in this book prove how, both  before and after that crisis, working  macroeconomists had rolled up their sleeves to study how financial frictions, incentive problems, incomplete markets, interactions among monetary, fiscal, regulatory, and bailout policies, and a host of other issues affect prices and quantities and good economic policies. This is an especially timely book." --Thomas Sargent, New York University