Main themes: This course presents an in depth analysis of the impact of heterogeneity in the macro-economy.   The main framework which is utilized is the so called model of heterogeneous agents and wealth accumulation which is basically the workhorse model in modern quantitative macroeconomics.  Several applications of the theory will be discussed covering the effects of recent trends in income inequality in the US and in Europe, the life cycle pattern of consumption, the cyclical behavior of aggregate hours and employment, the wealth concentration and the role of public policies such as the tax code and  the pension system. In a last part this course will explore the implications of alternative models of heterogeneous agents and in particular models of endogenous incomplete financial markets.


Aims: The aim of the course is to teach the students to apply the tools of quantitative macroeconomics with a particular focus on the effects of heterogeneity. The treatment of the economic problems is rigorous and the students will be required to master the numerical methods which are utilized to solve the models presented in class. Beyond the methodological side, the content of this course is motivated by the microeconomic data and the course itself discusses several interesting economic phenomena related to household decisions and their impact on the macroeconomy.