## Macro 2 - Tepper School of Business

**Lecture Notes:**

Part 1: Search and Unemployment - [

Part 2: Notes on the Huggett-Aiyagari model - [

Notes on the Endogenous Grid Method - [

**Lectures:**

- Lecture 1:
- We discussed McCall's model of search. For a version where the searcher does not know the distribution of outcomes (wages, prices, etc.) see
__Rothschild (1974)__ - Briefly discussed Stigler's version of search which is non-sequential. As De Los Antos, Hortacsu, and Wildenbeest - paper
__here__- show using data on consumers' online search, consumers do go back to examined item, i.e., they do not buy the last item visited which is what sequential search model a la McCall would prescribe. - Discussed Rotschild's critique and Diamond's paradox and started on Burdett and Judd

- We discussed McCall's model of search. For a version where the searcher does not know the distribution of outcomes (wages, prices, etc.) see
- Lecture 2:
- Finished talking about Burdett and Judd Model. An interesting illustration of the forces in the model which can be potentially tested in the data is in the paper by Sorensen -
__here__. - Started talking about the DMP model

- Finished talking about Burdett and Judd Model. An interesting illustration of the forces in the model which can be potentially tested in the data is in the paper by Sorensen -
- Lecture 3:
- Finished the DMP model and talked about Hosios Condition
- Started discussing evidence on distribution of wages and its determinants; Re: AKM regressions, see the paper by Abowd, Kramarz and Margolis -
__here__.

- Lecture 4:
- Started discussing the model by Postel-Vinay and Robin.

- Lecture 5:
- FInshed the PVR model and started income fluctuations problem

- Lecture 6:
- Income fluctuations problem

- Lecture 7:
- Talked about the Aigayar-Huggett-Bewley model

- Lecture 8:
- Finished talking about the Aiyagari model
- Started talking about computation of the model

- Lecture 9:
- Endogenous vs Exogenous Risk sharing
- Unemployment Insurance

- Lecture 10:
- Finished the unemployment insurance problem

- Lecture 11:
- Started talking about trade and the DFS model

- Lecture 12:
- Further discussed DFS

- Lecture 13:
- Talked about the Eaton Kortum model

**Hand-written Notes from the Class**

Search - [

Consumption and Saving - [

Trade - [

**Problem Sets:**

Problem Set 1 - [

Problem Set 2 - [

Problem Set 3 - [

Last year's

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