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Loyola University Chicago

John Felice Rome Center

ECON 324: International Monetary Relations

Spring 2013

LOYOLA UNIVERSITY

Rome Center

Economics Department

 

 

International Monetary Relations (ECON 324)

TR 12:30pm – 1:45pm

Spring 2013 Syllabus

 

I. GENERAL INFORMATION

 

Instructor:     Marshall Langer

Office hours: By appointment (convenient times: TR 11:30am – 12:30pm)

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.

 

  1. Develop accurate assessments of foreign economic environments.

 

  1. Craft analyses that illuminate macroeconomic realities affecting international monetary relations. 

 

  1. Think more critically and more strategically globally in a business and economic context. 

 

  1. 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 IX 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, Eighth 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

 

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 01/15

Introduction

Course introduction.

--

INTERNATIONAL MACROECONOMICS

2

R 01/17

Lecture

National income accounting.

KR: C12 (p288-p301)

3

T 01/22

Lecture

Balance of payments.

KR: C12 (p301-p313)

4

R 01/24

Lecture

 

 

 

 

 

 

 

 

 

 

 

 

 

- - - - - - - - - -

Article

Deficits

 

See readings at:

 

http://www.dbresearch.de/PROD/DBR_INTERNET_DE-PROD/PROD0000000000180032.pdf (copy and paste this link)

 

http://www.iie.com/publications/papers/paper.cfm?ResearchID=735

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

Stagflation.

 

See reading at:

 

http://en.wikipedia.org/wiki/Stagflation

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

Global Flow of Funds

See websites

 

 

 

 

 

 

 

 

 

 

 

 

 

- - - -- - - - - - - - - - - -

Posted online

5

T 01/29

Film

Milton Friedman on global economics

--

6

R 01/31

Lecture

Macroeconomic policy and determinants of aggregate demand.

KR: C16 (p420-p425)                  

7

T 02/05

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 02/07

Lecture

Exchange rate determination.

Relationship among inflation, money supply, interest rates, and exchange rates.

KR: C19 (p544-p551)

IF: C4 (p107-p118)

(C4 optional)

9

T 02/12

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-p386)

                 (p394-p401)

Foreign Exchange Quotations

10

R 02/14

Guest Speaker

Topic: Economics of International Labor Migration

--

11

T 02/19

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 02/21

Lecture

 

- - - - - - - - - -

Article

Central bank (gov’t) operations on money supply; mechanisms of fixed exchange rates.

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

Currency crises

IF: Chapter 6

KR: C17 (p462-p466)

- - - -- - - - - - - - - - - -

Posted online

13

T 02/26

Review

Midterm Exam review.

 

14

R 02/28

Exam

Midterm Exam.

--

--

T 03/05

No Class

--

--

--

R 03/07

No Class

--

--

 

 

 

#

 

Date

Instruction /

Activity

Topic /

Written Assignment Due (if any)

Reading Assignment

(Read for assigned class)

15

T 03/12

Lecture

International negotiations.

IO: Int’l negotiations

MG: Int’l negotiations

INTERNATIONAL TRADE

Trade Theory

16

R 03/14

Lecture

Comparative advantage

KR: C3 (p28-p29)

               (p36-p42)

17

T 03/19

Lecture

Comparative advantage – cont’d

KR: C3 (p42-p47)

               (p48-p51)

Trade Policy

18

R 03/21

Lecture

Instruments of trade policy.

KR: C8 (p182-p196)

19

F 03/22

Film

Life and Debt (Globalization and the Jamaican Economy)

--

20

T 03/26

Lecture

Economies of scale and imperfect competition.

KR: C6 (p129-p135)

--

R 03/28

No Class

--

--

Regional Trade

21

T 04/02

Case study

Charlene Barshefsky

Case #: 801422

SOVEREIGN RISK ASSESSMENT

Economics of Emerging Markets

22

R 04/04

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 04/09

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 04/11

Lecture

Developing country economic crises.

KR: C22 (p621-p647)

25

T 04/16

Presentations

Article presentations.

--

26

R 04/18

Lecture

Final Exam review.

--

27

TBD

Exam

Final Exam.

--

 

Loyola

John Felice Rome Center · Sullivan Center for Student Services· 6339 N. Sheridan Rd., Chicago, IL 60660
Mailing Address: 1032 W. Sheridan Road, Chicago, IL 60660
800.344.ROMA · rome@luc.edu

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