Robert F. Mulligan, Ph.D.
Department of Economics, Finance, & International Business
Macroeconomic Forecasting & Analysis

ECON 303 Money, Financial Markets, and Economic Policy

Annotated Reference List

These references may be helpful in suggesting further refinements for your forecasting project. You should be aware of these sources if they are relevant to your project. Most are available in Hunter Library. Use these as starting points to find additional sources. If you find an especially useful source not listed here, be sure to let me know.


Anderson, Benjamin M., Economics and the Public Welfare, 2d edition, Indianapolis IN: Liberty Press, 1979.

Provides an economic and financial history of the U.S. for 1914-1946, covering both world wars and the depression. An excellent source of historical data. Chapter 60 provides a critique of Keynesian economics. Chapters 61-64 provide insight into why the gold standard was abandoned. Chapter 81 discusses the Bretton Woods conference. Each chapter is relatively brief and many were published as articles in the Commercial & Financial Chronicle and other periodicals. Bernanke, Ben, ed., Readings and Cases in Macroeconomics, New York: McGraw Hill, 1987. Articles by Meyer and Throop discuss the impact of government spending on business investment, pp. 76-94. Articles by Hoover and Bisignano discuss Ricardian equivalence, pp. 152-161. The article by Hakkio and Higgins discuss the persistent U.S. capital account surplus, pp. 389-403. Blanchard, Oliver Jean, and Fischer, Stanley Lectures on Macroeconomics, Cambridge MA: MIT Press, 1989. An advanced, graduate-level text. Skip the math. Branson, William H., Macroeconomic Theory and Policy, 2d edition, New York: Harper & Row, 1979. Describes the Relative, Permanent, and Life-cycle income hypotheses about the Keyensian consumption function, pp. 183-203. Champ, Bruce, and Freeman, Scott, Modeling Monetary Economies, New York: Wiley, 1994. Some of the simpler models in this book may be useful for forecasts. Dornbusch, Rudiger, Open Economy Macroeconomics, New York: Basic Books, 1980. The growing importance of the international sector is explained, pp. 1-29. Unfortunately, this book is partly written from the pre-1973 perspective of fixed exchange rates of the Bretton Woods System. Friedman, Milton, and Schwartz, Anna Jacobson, A Monetary History of the United States, 1867-1960, Princeton NJ: Princeton University Press, 1963. This is the primary source for historical U.S. financial data. Gordon, Robert J., ed., Milton Friedman's Monetary Framework, Chicago: University of Chicago Press, 1970. This presents a fairly long article by Friedman explaining monetarist economics and the importance of the quantity theory, along with two shorter articles sympathetic to his views, and two from a Keynesian perspective. Some of the detail is too technical to be easily understood or of much use, pp. 1-20 provide an excellent introduction to monetary economics, and the four shorter articles are also very good. The two Keynesian articles are the easiest to understand and make no use of the IS-LM model, which is outside the scope of this class. Gordon, Robert J., ed., The American Business Cycle, New York: National Bureau of Economic Research, 1985. The data appendices provide more historical data than nearly any other source. Hazlitt, Henry, The Failure of the "New Economics," Lanham MD: University Press of America, 1983. Hazlitt presents a chapter-by-chapter critique of Keynes's General Theory. Much easier to understand than Keynes. W.H. Hutt, The Keynesian Episode, Indianapolis IN: Liberty Press, 1979. Hutt writes from an after-Keynesianism perspective. This book is not too technical or mathematical and therefore very easy to understand. Keynes, John Maynard, The General Theory of Employment, Interest, and Money, New York: Harcourt Brace & World, 1935. Keynes presents the consumption and savings functions (Chapter 10), and the investment function (Chapter 11.) This book is rough going, but not mathematically difficult. Hazlitt, though antagonistic toward Keynes, is an excellent guide. Leijonhufvud, Axel, Information and Coordination, New York: Oxford University Press, 1981. This is a simplified, modernized presentation of the Keynesian system. McCafferty, Stephen, Macroeconomic Theory, New York: Harper & Row, 1990. Provides an excellent exposition of the Real Business Cycle models, pp. 430-431 & 440-445 (forget the math.) A good discussion of New Keynesian business cycle models with efficiency wages and small menu costs is also given, pp. 447-449, 451-454, & 462-464. Mueller, M.G., ed., Readings in Macroeconomics, New York: Holt, Rhinehart, & Winston, 1966. Hagen presents a classical explanation of ouput and employment determination, pp. 3-15. Hansen discusses Keynes's General Theory, pp. 16-23. Samuelson presents a fairly sophisticated and mathematical new classical model, pp. 24-36. Avoid if you don't know calculus. Smith's Keynesian model is easier to understand because of the graphical presentation, pp. 37-48. Duesenbury and Farrell discuss the relationship between consumption and total income in a variety of models, pp. 61-94. White discusses how investment responds to changes in interest and Knox discusses how changes in investment impact total income through the autonomous spending multiplier, pp. 95-136. The articles on money and liquidity may be of interest. Patinkin's article on wage and price flexibility and their impact on unemployment may also be useful, pp. 226-244. Phillips's original Phillips curve article is here, pp. 245-258. Hansen discusses the relationship between economic growth and population, pp. 265-276. Smith, William L., and Teigen, Ronald L., eds., Readings in Money, National Income, and Stabilization Policy, Homewood IL: Irwin, 1965. Johnson derives the Keynesian multipliers, pp. 32-43. Teigen derives money supply and demand functions, pp. 44-75. Teigen discusses using government spending as a stabilization instrument, an idea now largely abandoned, pp. 302-306. The articles by Mundell, Johnson, and Smith are interesting for the light they throw on 1960's policy issues, pp. 519-545. The international finance articles assume fixed exchange rates (pre-1973). Beware.

Chance, Don M., An Introduction to Derivatives, 4th edition, Ft Worth TX: Dryden, 1998.

This is a more advanced, technical, and mathematically sophisticated, options and futures text than Strong. Federal Reserve Bank of Kansas City, Maintaining Financial Stability in a Global Economy, Kansas City: Federal Reserve Bank of Kansas City, 1997. Backstrom explains how Sweden successfully defended itself from speculative attack against the Euro in the early 1990's, pp. 129-140. Suzuki discusses the Japanese perspective, pp. 169-174. Klaus discusses the problems faced by formerly communist countries, pp. 183-192. Meulendyke, Ann-Marie, U.S. Monetary Policy & Financial Markets, New York: Federal Reserve Bank of New York, 1998. This book discusses the Fed's history, operations, goals, and mechanics. Chapters 5-7 discuss open market operations and the FOMC. Chapter 8 discusses the relationship between monetary policy and the interest-rate yield curve, pp. 196-198. Mishkin, Frederic S., The Economics of Money, Banking, and Financial Markets, 5th edition, Reading MA: Addison Wesley, 1998. This is a slightly easier money and banking text than Thomas. Thomas, Lloyd B., Money, Banking, and Financial Markets, New York: McGraw-Hill, 1997. Our money and banking textbook provides excellent coverage of all theoretical aspects of financial markets, including the yield curve, the quantity theory, and bond markets. Van Horne, James C., Financial Market Rates and Flows, 5th edition, Upper Saddle River NJ: Prentice Hall, 1998. This is a graduate level finance book. Its great virtue is its brevity. Discussions of inflation premia (Chapter 5,) term structure of interest rates (Chapter 6,) and the influence of taxes on investments (Chapter 15,) are especially recommended. The derivatives chapters are very mathematically sophisticated, but may be of interest.

Granger, Clive W.J., Forecasting in Business and Economics, 2d edition, Boston: Academic Press, 1989.

An excellent, easy to read and understand text on econometric forecasting. Sometimes its brevity makes a more detailed book like Pindyk and Rubinfeld better. Kennedy, Peter, A Guide to Econometrics, 3d edition, Cambridge MA: MIT Press, 1992. This is a comprehensive handbook of econometrics. While not specifically a guide to forecasts, you probably should not attempt anything not described here. Pindyck, Robert S., and Rubinfeld, Daniel L., Econometric Models and Economic Forecasts, 3d edition, New York: McGraw-Hill, 1991. This is a very detailed, easy to understand, econometric forecasting text. Compare to Granger. Studenmund, A.H., Using Econometrics, 2d editon, New York: Harper Collins, 1992. A basic, comprehensive, and easy to understand econometrics text.

Kennedy, Peter, Macroeconomic Essentials for Media Interpretation, Cambridge MA: MIT Press, 1997.

Facilitates the use, interpretation, and analysis, of information from media sources.