Instructor:
Luigi Bocola (Stanford University)
Dates: 25-29 August 2025
Hours: 9:30 to 13:00 CEST
Format: In person
Intended for
Academic researchers and researchers in policy institutions interested in the intersection of Macroeconomics and Finance.
Prerequisites
Participants are assumed to have knowledge of macroeconomics at the master/PhD level. That includes basic knowledge of numerical methods for the solution of dynamic stochastic general equilibrium models.
Overview
The past fifteen years have seen a growing body of theoretical, quantitative, and empirical research focused on understanding the macroeconomic implications of shocks to the financial sector and on studying what policymakers can do to reduce the risk of financial crises. The aim of this course is to cover state-of-the-art research at the intersection of macroeconomics and finance and, specifically, contributions that focus on the propagation of financial shocks to the rest of the economy. We will start by introducing a canonical macroeconomic model where financial intermediaries face leverage constraints, discuss its implications for the propagation of shocks, and study different algorithms for its numerical solution. We will discuss how to use this framework for the analysis of financial crises and for the design of financial regulations. The course will conclude with a set of advanced topics at the intersection of macroeconomics and finance.
Topics
Dates: 25-29 August 2025
Hours: 9:30 to 13:00 CEST
Format: In person
Intended for
Academic researchers and researchers in policy institutions interested in the intersection of Macroeconomics and Finance.
Prerequisites
Participants are assumed to have knowledge of macroeconomics at the master/PhD level. That includes basic knowledge of numerical methods for the solution of dynamic stochastic general equilibrium models.
Overview
The past fifteen years have seen a growing body of theoretical, quantitative, and empirical research focused on understanding the macroeconomic implications of shocks to the financial sector and on studying what policymakers can do to reduce the risk of financial crises. The aim of this course is to cover state-of-the-art research at the intersection of macroeconomics and finance and, specifically, contributions that focus on the propagation of financial shocks to the rest of the economy. We will start by introducing a canonical macroeconomic model where financial intermediaries face leverage constraints, discuss its implications for the propagation of shocks, and study different algorithms for its numerical solution. We will discuss how to use this framework for the analysis of financial crises and for the design of financial regulations. The course will conclude with a set of advanced topics at the intersection of macroeconomics and finance.
Topics
- A macroeconomic model with financial intermediation
- Local and global numerical solutions methods
- Shock propagation
- Welfare properties and optimal financial regulation
- Advanced topics: i) From micro estimates to macro effects; ii) The financing of supply chains and non-bank intermediaries; iii) Financial crises in open economies
- Professor: Luigi Bocola