Topics: - The microeconomics of exchange rate pass through into import prices - The transmission of import prices to prices at the retail level - The globalization of the inflationary process, and the global slack hypothesis - The nature of optimal monetary policy in a more open economy -...

In the course we will begin by critically reviewing the most popular existing real and monetary models of the business cycle both of the real business cycle and the New Keynesian variaty. We will discuss micro data on price behavior and real relative prices across countries that is at odds with...