Econ 324 International Monetary Relations
Spring 2014
LOYOLA UNIVERSITY
Rome Center
Economics Department
International Monetary Relations (ECON 324)
Spring 2014 Syllabus
I. GENERAL INFORMATION
Instructor: Marshall Langer
Office hours: By appointment
Telephone: +39 347.1763096
Email: mlanger11@gmail.com
Background: Wall Street; corporate management, economic analysis, strategic planning. Wharton MBA.
II. COURSE INFORMATION
1. Course Description. In this course students assess theories of international monetary relations (often termed by economists as international macroeconomics). Topics covered include international trade, monetary theory, international finance, foreign exchange markets, balance of payments (and trade deficits), capital mobility, government fiscal and monetary policies, international macroeconomic cooperation, economic crises, and the role of international institutions.
The course is divided into 4 distinct parts, as follows:
Part 1. International Macroeconomics
Part 2. Foreign Exchange
Part 3. International Trade
Part 4. Sovereign Risk Assessment
2. Learning Objectives.
- Develop accurate assessments of foreign economic environments.
- Craft analyses that illuminate macroeconomic realities affecting international monetary relations.
- Think more critically and more strategically globally in a business and economic context.
- Hone sensitivity skills required to succeed in multinational business environments.
III. LEARNING ACTIVITIES
1. Interactive class discussion. Classes are highly interactive. Instructor prompts students for response to questions posed and solicits his/her thoughts on issues discussed. Format is probing and direct. Additionally, instructor provides concrete, real-world examples to illustrate concepts. Lecture format reinforces by example appropriate methods for asking questions, gaining relevant insights, and making appropriate recommendation. (Contributes to Learning Objectives A, B, C, D)
2. Presentation of textbook readings. Textbook and other assigned readings (assigned according to the schedule in section VIII of this syllabus) present relevant topics, which are covered more depthfully in class lecture. In class discussion of readings, instructor highlights most relevant reading topics and shows by example how to present data in a stimulating way, consistent with achieving course objectives. (Contributes to Learning Objectives A, B, C)
3. Case Study and/or Article Presentation. Case studies and articles are used to further illustrate real-world examples of subject topics. For all assigned cases/articles, students should be prepared to answer questions about the case/article and be able to illustrate its subtler aspects. For select cases/articles an individual written submission is due. For select cases/articles students will be selected to make a presentation. In class discussion of case studies/articles serves to highlight analytical methods, indicating specifically, ways to discern the most relevant focal points. (Contributes to Learning Objectives A, B, C, D)
IV. ASSESSMENT
37% Midterm exam
43% Final exam
5% Presentation of case study, article
15% Quizzes and class participation
1. Exams. Exams will be composed of essay questions that test your ability to apply concepts discussed through the exam date. (Measures Learning Objectives A, B, C)
2. Case/Article Analyses. All cases/articles should be prepared for class. For select cases/articles, where indicated, an individual written submission is due and is assigned based on the schedule in section VIII of this syllabus. Additionally, for select cases/articles students will be selected to make a presentation. Your grade for the presentation will reflect much new insight you teach the class (rather than repeat the facts). (Measures Learning Objectives A, B, C)
3. Quizzes. Short, in-class quizzes will test your comprehension of course materials to date. (Measures Learning Objectives A, B, C)
4. Class Participation. You will be graded on the quality of, and demonstrated insight of, your in-class comments, including comments related to answers to assigned problems. (Measures Learning Objectives A, B, C, D)
5. Attendance. Attendance is mandatory, however a student may miss up to 4 classes without penalty or explanation. Absences of more than 4 must be approved by the instructor. More than 4 unapproved absences will result in a reduced grade.
V. REQUIRED COURSE READING MATERIAL
1. Required reading:
|
Code |
Title |
|
Purchased by student: |
|
|
KR |
Krugman, Obstfeld, International Economics: Theory and Policy, 8th Edition, Pearson, 2008 |
|
Distributed electronically by instructor: |
|
|
EM |
Hooke, Emerging Markets, A Practical Guide, Wiley, 2001 |
|
IF |
Madura, International Financial Management, 7th Edition, Thomson South-Western, 2003 |
|
IO |
Adler, International Dimensions of Organizational Behavior, 4th Edition, Wadsworth, 1992 |
|
MG |
Hill, International Business, Managing Globalization, Sage, 2009 |
|
-- |
Select articles and cases as detailed in Section VIII
|
VI. SUGGESTED ADDITIONAL READINGS
1. Books.
Hill, Think and Grow Rich, St. Martin’s Press, 2001
Friedman, The World is Flat, Picador, 2007
Samuelson, Economics, McGraw-Hill, 2004
Rolfe, Monkey Business, Warner Books, 2001
2. Internet Sites.
http://stats.bls.gov for US Bureau of Labor Statistics
www.sec.gov for public company filings (all U.S. public plus foreign public with U.S. listings)
www.hoovers.com for summary company info, comparables search, etc.
www.statsoft.com/textbook/stathome - for straightforward explanations of statistical terms and concepts
http://www-personal.umich.edu/~alandear/glossary/ - for terms
http://en.m.wikipedia.org/wiki/Fractional_reserve_banking
http://www.youtube.com/watch?v=jFnH9MCdpLo - fed operations video
3. Periodicals.
Business Week, Harvard Business Review, Sloan Management Review, The Economist
VIII. CLASS SCHEDULE
Please note:You are not required to make a written submission unless instructed to do so. Reading should be completed prior to class.
|
# |
Date |
Instruction / Activity |
Topic / Written Assignment Due (if any) |
Reading Assignment (Read for assigned class) |
|
1 |
T 01/21 |
Introduction |
Course introduction. |
-- |
|
INTERNATIONAL MACROECONOMICS |
||||
|
2 |
R 01/23 |
Lecture |
National income accounting. |
KR: C12 (p288-p301) |
|
3 |
T 01/28 |
Lecture |
Balance of payments. |
KR: C12 (p301-p308) |
|
4 |
R 01/30 |
Lecture
- - - - - - - - - - Article |
Deficits
See readings at:
http://www.dbresearch.de/PROD/DBR_INTERNET_DE-PROD/PROD0000000000180032.pdf (copy and paste this link) - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Stagflation.
See reading at:
http://en.wikipedia.org/wiki/Stagflation - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Global Flow of Funds |
See websites
- -- - - - - - - - - - - - p3-6 |
|
5 |
T 02/04 |
Film |
Milton Friedman on global economics |
-- |
|
6 |
R 02/06 |
Lecture |
Macroeconomic policy and determinants of aggregate demand. |
KR: C16 (p420-p425) |
|
7 |
T 02/11 |
Lecture |
Macroeconomic policy coordination. |
KR: C16 (p437-p441) (box p450) KR: C14 (p359-p362) (C14 optional for additional clarity on exchange rates) |
|
FOREIGN EXCHANGE |
||||
|
8 |
R 02/13 |
Lecture |
Exchange rate determination. Relationship among inflation, money supply, interest rates, and exchange rates. |
KR: C19 (p544-p551)
Optional reading IF: C4 (p107-p118) |
|
9 |
T 02/18 |
Lecture |
Purchasing power parity. See specifically chart p397.
See:
http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nominal) http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP) |
KR: C15 (p384-p388) (p394-p401) |
|
Foreign Exchange Quotations |
||||
|
10 |
R 02/20 |
Film |
Life and Debt (Globalization and the Jamaican Economy) |
-- |
|
11 |
T 02/25 |
Lecture |
Interpreting foreign exchange and option quotations.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Modeling foreign currency effect. |
IF: C3 (p69-p77) Handout posted online - - - -- - - - - - - - - - Posted online |
|
Government Actions on Foreign Currency |
||||
|
12 |
R 02/27 |
Lecture
- - - - - - - - - - Article |
Central bank (gov’t) operations on money supply; mechanisms of fixed exchange rates.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Currency crises |
KR: C17 (p462-p466)
Optional reading IF: Chapter 6 - - - -- - - - - - - - - - Posted online |
|
13 |
T 03/04 |
Review |
Midterm Exam review. |
|
|
14 |
R 03/06 |
Exam |
Midterm Exam. |
-- |
|
-- |
T 03/11 |
No Class |
-- |
-- |
|
-- |
R 03/13 |
No Class |
-- |
-- |
|
# |
Date |
Instruction / Activity |
Topic / Written Assignment Due (if any) |
Reading Assignment (Read for assigned class) |
|
15 |
T 03/18 |
Lecture |
International negotiations. |
IO: Int’l negotiations MG: Int’l negotiations |
|
INTERNATIONAL TRADE |
||||
|
Trade Theory |
||||
|
16 |
R 03/20 |
Lecture |
Comparative advantage |
KR: C3 (p28-p29) (p36-p42) |
|
|
|
|
|
|
|
|
|
|
|
|
|
17 |
T 03/25 |
Lecture |
Comparative advantage – cont’d |
KR: C3 (p42-p47) (p48-p51) |
|
Trade Policy |
||||
|
18 |
R 03/27 |
Lecture |
Instruments of trade policy. |
KR: C8 (p182-p196) |
|
19 |
T 04/01 |
Film |
International economics film. |
-- |
|
20 |
R 04/03 |
Lecture |
Economies of scale and imperfect competition. |
KR: C6 (p129-p135) |
|
Regional Trade |
||||
|
21 |
T 04/08 |
Case study |
Charlene Barshefsky |
Posted online |
|
SOVEREIGN RISK ASSESSMENT |
||||
|
Economics of Emerging Markets |
||||
|
22 |
R 04/10 |
Lecture
- - - - - - - - - - Articles |
Emerging market characteristics and specific economic issues.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - EM Sovereign Debt (through section 2.1) Economist articles on Russia, China, India, Venezuela |
EM: C2,3 (p26-p44) (p46-p54) - - - - - - - - - - - - - - Posted online |
|
Country analysis |
||||
|
23 |
T 04/15 |
Lecture
- - - - - - - - - - Articles
|
Country risk assessment. Measuring exposure.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Who Sank, or Swam, in Choppy Currents of a World Cash Ocean - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - See: ISTAT Italy statistics |
IF: C16 (p476-p482) IF: C10 (p303-p305) (p311-p313) (p319-p323) - - - - - - - - - - - - - - Posted online - - - - - - - - - - - - - - Posted online |
|
24 |
R 04/17 |
Lecture |
Developing country economic crises. |
KR: C22 Table 22.2, (p625-p637) |
|
25 |
T 04/22 |
Lecture |
Developing country economic crises – cont’d. |
KR: C22 (p637-p646) |
|
26 |
R 04/24 |
Lecture |
Final Exam review. |
-- |
|
27 |
TBD |
Exam |
Final Exam. |
-- |
EOC problems
Suggested end of chapter problems - you are not required to submit answers to these questions. They are intended to help clarify the concepts. Answers are posted online.
C12 - 2 (national income accounting), 3, 5, 8, 9 (BOP)
C16 – 3, 5, 6, extra: 14, 16
C15 – 1, 3, 13, 14, 15 (on nominal and real interest rates)
C17 – 3, 5, 9, 13, 16, 20 (last ones good for non fx part of bs)
C3 – 4, 6, 7, 8
C8 – 3, 5, 7, 8, 10
C19 – 3, 4, 7, 8, 12
C22 – 3–8, 11, 12
