IF 1203 Macroeconomics, Coursework 2024: Moodle in PDF format The basic question for the coursework is the same as in previous years, however, the arrival of search engines that incorporate Al has made it necessary to offer two different options this year for those who wish to avoid Al and for those who want to use it. This approach to handling Al is clearly experimental and feedback on this is welcome. The required task is: "Choose any one country, assess its current macroeconomic position, and discuss what policies have been adopted by the monetary and fiscal authorities in the recent past. What should the monetary and fiscal authorities be doing over the next year or so, in your opinion?” (“recent” here means that it was not known in March/April last year when similar reports were being written! In other words, do not try copying work from previous year's students. This can be done in groups of up to five people. (You can do it alone if your circumstances make it hard to work with a group, but it is better if you can work with others, as this kind of cooperation is good experience.) The skills associated with writing a report are among the most important things you should acquire at university. So learning to write a good report is going to be very important for all your careers. However, a new challenge is posed by the availability of Al which can make you look like a cheat if you do not handle it carefully. Accordingly, I am suggesting one of two possible approaches to this report. Option 1 (No AI). Use the October 2023 IMF WEO Database (https://www.imf.org/en/Publications/WEO/weo- database/2023/October) to select data for one country of your choice. Suggested series are: GDP at constant prices % change (the growth rate of real GDP) The Output Gap as % of potential GDP (GDP gap) (NB: the IMF does not calculate the Gap for all countries.....only the major ones). Inflation rate of consumer prices % change (Inflation) The unemployment rate as % of the labour force. General Government structural balance as % of GDP (structural budget deficit) General Government gross debt as % of GDP. (national debt) Current Account balance of payments as % of GDP. (balance of payments deficit) (Plus any other series you think are relevant.) The IMF WEO database for most countries has data from 1980 to 2022 and forecasts to 2028. You can choose what period to cover but I suggest maybe 2000 to 2028. Download the data into Excel and draw charts of each of these data series. Then put your charts into a document and explain what you think has been going on in that economy over the period covered. You can then add a section on what policy makers did in response to earlier crises as well as how they responded to the surge in inflation in 2022/3. Here the policy decisions of the past two years or so are most important (note there is UK Budget on 6th March 2024). Then suggest from your own perspective what you think they should be doing now to get their economy on a desirable course. Here you can refer to any very recent data that came out after October 2023 that might suggest a different course for the economy.......but be clear what it is and where it came from. Option 2 (AI OK) Answer the same question using whatever data you like and using whatever search engines you like. BUT you must take responsibility for the detail and structure of the submitted report to ensure that it is not copied from somewhere else, that it contains the latest available information and that all sources are either in quotation marks and/or are properly listed. Also, it must follow a logical structure that you would use if you were doing it for yourself and you had the right skills to do it. The purpose of the course is to suggest what that structure might look like, and I will provide a further note giving feedback on the submissions of previous years (which sets this out) All work under both Options will be checked for copied material and so it is your job to ensure that the Al has not copied work on your behalf even if you did not do it yourselves. All references must be of good quality and relevant the work in hand. This means that wherever you get your text from, you must read it for quality control and take responsibility for it as if it were your own work. For all: Be very careful not to copy chunks of material from internet sites or other publications as this will constitute plagiarism. Quotations from other material are fine as long as they are marked as such and the source is clearly stated, however, the best work will be in your own words but referring to official data in the form of charts or tables. Do not use sites on the internet that have no obvious quality control. This includes Wikipedia. Official sources (such as governments and central banks) and international agencies, as well as academic journals and working papers can be assumed to have good quality control. You also need to state clearly what search engines you have uses.....especially if they include Al (such as ChatGTP). The work should be typed and around 1500 words in length, and certainly not longer than 2000 words. Charts, references, and tables may be included in addition to this word limit. References should be given to data sources and any other material used. Any direct quotes from source material should be clearly indicated and the source attributed. The central focus should be on real GDP and its recent history. Is GDP below trend, is there a significant GDP gap? [For major countries, estimates of the GDP gap are available from the IMF, but for others you would have to compare actual GDP with its trend.] Is it positive or negative? If negative, why is demand weak.....is it C, I, G or net trade? Look for other indicators of slack or overheating, what is happening, for example, to inflation and unemployment? If inflation is high the economy may be overheating, but if unemployment is high and rising then the economy may need some stimulus. What is the state of the balance of payments? Does the economy need some stimulus or some slowing down? In most countries the dominant issue of the past two decades was the after-effects of the 2008/9 global financial crisis (or the Eurozone debt crisis of 2011/12). This cut demand and led to output falls and higher unemployment. Most economies recovered from this, but have recently been hit by the Covid crisis followed by the energy crisis. What else should now be done in the near future to help your economy recover from these crises? Inflation in 2022/3 was high in many countries, but has since fallen. Growth in the US has been strong, but it has been very slow in the UK and much of Europe. What should policy makers do about this? What have monetary and fiscal policy makers been doing recently? Have there been announcements of tax or spending changes from the government? If so, what reasons were given? Have official interest rates been rising or falling? What is quantitative easing (QE) aimed to achieve and how well has it done? Is it now being reversed? For information about UK monetary policy you can access the Monetary Policy Report via www.bankofengland.co.uk and you can search on "monetary policy" on the Bank's home page. UK fiscal policy links can be found via the Treasury web site: http://www.hm-treasury.gov.uk/ Look also at the latest OBR Economic and Fiscal Outlook (obr.uk) and the latest Budget from HM Treasury. Data for other countries can be found from the IMF on www.imf.org. Search for World Economic Outlook (WEO) and this will lead you both to IMF assessments and to annual data since 1980 plus latest IMF projections (via WEO database). Feel free to contact me if you have any other questions. KAC January 2024./nINSTRUCTIONS Need to Do Both Option 1 in 1500 Words • Chosen Country is Germany

Fig: 1