ECON 7044 - International Finance PG

North Terrace Campus - Semester 1 - 2015

This course deals with the analysis of two important and related macroeconomics issues in open economies: the exchange rate and the capital flows. The objectives of the course are two-fold: first to introduce the main concepts, principles and models in the theory and empirical works in those two key areas of International Finance; second to apply analytical tools to understand the relevant policy issues in the global markets. The basic tenets of international finance are presented through the textbook, assigned readings and online lectures. Practical applications of theory to current world events, policy assessment and research advances in the field are discussed in detail during the weekly seminar.

  • General Course Information
    Course Details
    Course Code ECON 7044
    Course International Finance PG
    Coordinating Unit School of Economics
    Term Semester 1
    Level Postgraduate Coursework
    Location/s North Terrace Campus
    Units 3
    Contact Up to 3 hours per week
    Available for Study Abroad and Exchange Y
    Prerequisites ECON 7011 & ECON 7071
    Restrictions Available to MFin&BusEc, ProCertPubPolicy, GradCertEc, GradCertIntEc, GradDipIntEc, GradDipAppEc, MAppEc, MAppEc(Int) & MAppEc(PubPolicy) students only
    Course Description This course deals with the analysis of two important and related macroeconomics issues in open economies: the exchange rate and the capital flows. The objectives of the course are two-fold: first to introduce the main concepts, principles and models in the theory and empirical works in those two key areas of International Finance; second to apply analytical tools to understand the relevant policy issues in the global markets.
    The basic tenets of international finance are presented through the textbook, assigned readings and online lectures. Practical applications of theory to current world events, policy assessment and research advances in the field are discussed in detail during the weekly seminar.
    Course Staff

    Course Coordinator: Dr Steven Hail

    Office location: Nexus 10, Level 3, Room 3.34
    Telephone: 8313 5671

    Course Timetable

    The full timetable of all activities for this course can be accessed from Course Planner.

  • Learning Outcomes
    Course Learning Outcomes
    This course deals with the analysis of selected macroeconomic issues in open economies. The outcomes of the course are three-fold:
    1 Investigating new ideas:
    To provide participants with a broad overview and understanding at an intermediate level of the development of modern theories of exchange rates and international finance
    2 Confidence to investigate new ideas:
    Using the tools studied, to better think laterally about the fundamental issues facings global financial markets
    3 Opportunities for practical implementation of the concepts:
    To apply these theories as analytical tools to understand a range of relevant policy issues in global foreign exchange and capital markets
    University Graduate Attributes

    This course will provide students with an opportunity to develop the Graduate Attribute(s) specified below:

    University Graduate Attribute Course Learning Outcome(s)
    Knowledge and understanding of the content and techniques of a chosen discipline at advanced levels that are internationally recognised. 1-3
    The ability to locate, analyse, evaluate and synthesise information from a wide variety of sources in a planned and timely manner. 1-3
    An ability to apply effective, creative and innovative solutions, both independently and cooperatively, to current and future problems. 1-3
    Skills of a high order in interpersonal understanding, teamwork and communication. 1-3
    A proficiency in the appropriate use of contemporary technologies. 1-3
    A commitment to continuous learning and the capacity to maintain intellectual curiosity throughout life. 1-3
    A commitment to the highest standards of professional endeavour and the ability to take a leadership role in the community. 1-3
    An awareness of ethical, social and cultural issues within a global context and their importance in the exercise of professional skills and responsibilities. 1-3
  • Learning Resources
    Required Resources

    Currencies, Capital Flows and Crises, John T. Harvey, Routledge (London and New York), 2009

    Recommended Resources

    There are several other texts which could have been used on this course. None are recommended here as substitutes to Copeland, since the different texts use a variety of approaches to the models to be discussed, and this can be a source of confusion. Nevertheless one supplementary text which is of value to course participants is Exchange Rates and International Finance, (4th or 5th Edition) Laurence Copeland, Prentice Hall/Financial Times (Pearson Education), 2005/8.

    Online Learning
    MyUni - http://www.myuni.adelaide.edu.au

    Other online Resources:
    WTO: http://www.wto.org 
    UNCTAD: http://www.unctad.org 
    OECD: http://www.oecd.org 
    International Center for Trade and Sustainable
    Development: http://www.ictsd.org 
    The World Bank: http://www.worldbank.org 
    Alan Deardorff’s Glossary of International Economics Terms:
    http://www.personal.umich.edu/~alandear/glossary
  • Learning & Teaching Activities
    Learning & Teaching Modes

    The lectures for the related undergraduate course - which you are not required to attend, but you are strongly advised to watch on MyUni if you choose not to attend - will closely follow this text. The idea is that the lectures and the text should reinforce each other. You are strongly advised to keep up with the reading. You will find that the lectures are far easier to follow if you have already been exposed to the material via the text.

    The seminars will build each week on the material covered during the previous week's lectures, and will be based either on a more advanced treatment of what has been covered in the lectures, or a discussion of a related academic paper or current events. 

    The degree of difficult in the PG seminars and tutorials will reflect the normal expectation on a postgraduate course in international finance.

    The tutorial will be primarily based on problem solving in preparation for your written assessments and your final examination.

    Workload

    The information below is provided as a guide to assist students in engaging appropriately with the course requirements.

    Seminars: 1 Hour per week
    Lectures: 2 Hours per week (on line or in person)

    Tutorials: 1 Hour per week
    Home study expectation: 6 Hours per week (at least)

    Learning Activities Summary


    WEEKLY ACTIVITIES IN LECTURES AND POSTGRADUATE SEMINARS

    1
    Course Overview: Introduction to Basic Concepts in International Finance and Foreign Exchange Markets
    Harvey - Chapter 1 and a Reading Provided via MyUni

    2
    International Parity Relationships
    Reading Provided via MyUni

    3
    Neoclassical Models 1 -The Monetary Model of Floating and Fixed Exchange Rates
    Harvey - Chapter 2

    4
    Neoclassical Models 2 - The Dornbusch Overshooting Model of Floating Exchange Rates
    Harvey - Chapter 2

    5
    Empirical evidence on these models and later developments
    Reading provided via MyUni

    6
    Behavioural economics and decision making in the foreign exchange market
    Harvey - Chapter 3

    7
    Capital Flows and Exchange Rates
    Harvey - Chapter 4

    8
    Exchange Rate Modelling using a Keynesian Model
    Harvey - Chapter 5

    9
    Expectations and Currency Crises
    Harvey - Chapter 5

    10
    Real World Applications - volatility in the USD over time
    Harvey - Chapter 6

    11
    Real World Applications - the Peso (1994) and Asian (1997) crises
    Harvey - Chapter 6

    12
    Currency Areas and the Euro-zone Experiment
    Readings provided via MyUni

    13
    Seminar on the Euro-zone.

  • Assessment

    The University's policy on Assessment for Coursework Programs is based on the following four principles:

    1. Assessment must encourage and reinforce learning.
    2. Assessment must enable robust and fair judgements about student performance.
    3. Assessment practices must be fair and equitable to students and give them the opportunity to demonstrate what they have learned.
    4. Assessment must maintain academic standards.

    Assessment Summary
    Students will be assessed based on the following:

    Weekly Tutorial Assignments 30%
    Group Assignment #2 Due in Seminar in Week 12 20%
    Final Exam 50%
    Assessment Related Requirements
    The best 8 out of 10 weekly tutorial assignments form the basis of this part of your grade.
    No part of your assessment is redeemable in the final examination.
    You are expected to submit both the weekly assignments and the group assignment on time, unless you have prior approval from the course co-ordinator to do otherwise.
    The non-submission of assignments will lead to a zero grade for that element in your overall assessment.
    Assessment Detail

    NOTES ON ASSESSMENT
    1. Legible hand-writing and the quality of English expression are considered to be integral parts of the assessment process. Marks cannot be awarded for handwriting that cannot be read.

    2. Assessment marks prior to the final exam may be displayed on the course website through Myuni. Students are encouraged to check their marks and notify the lecturer-in-charge of any discrepancies.

    EXAMINATIONS
    It is each student's responsibility to read the examination timetable. Misreading the timetable is not accepted as grounds for granting a supplementary exam. University staff are not permitted to provide examination times to students over the telephone or in response to personal enquiries.

    Students may NOT take into the examination a DICTIONARY (English or English-Foreign)
    Students may NOT take a CALCULATOR.

    Submission

    Assignments are to be submitted in weekly tutorials, and in the seminar in week 12 (for the group assignment).

    Assignments will generally be returned during tutorials/lectures the week following submission.

    Students must not submit work for an assignment that has previously been submitted for this course or any other course without prior approval from the lecturer-in-charge.

    Course Grading

    Grades for your performance in this course will be awarded in accordance with the following scheme:

    M10 (Coursework Mark Scheme)
    Grade Mark Description
    FNS   Fail No Submission
    F 1-49 Fail
    P 50-64 Pass
    C 65-74 Credit
    D 75-84 Distinction
    HD 85-100 High Distinction
    CN   Continuing
    NFE   No Formal Examination
    RP   Result Pending

    Further details of the grades/results can be obtained from Examinations.

    Grade Descriptors are available which provide a general guide to the standard of work that is expected at each grade level. More information at Assessment for Coursework Programs.

    Final results for this course will be made available through Access Adelaide.

    Additional Assessment

    If a student receives 45-49 for their final mark for the course they will automatically be granted an additional assessment. This will most likely be in the form of a new exam (Additional Assessment) and will have the same weight as the original exam unless an alternative requirement (for example a hurdle requirement) is stated in this semester’s Course Outline. If, after replacing the original exam mark with the new exam mark, it is calculated that the student has passed the course, they will receive 50 Pass as their final result for the course (no higher) but if the calculation totals less than 50, their grade will be Fail and the higher of the original mark or the mark following the Additional Assessment will be recorded as the final result.
  • Student Feedback

    The University places a high priority on approaches to learning and teaching that enhance the student experience. Feedback is sought from students in a variety of ways including on-going engagement with staff, the use of online discussion boards and the use of Student Experience of Learning and Teaching (SELT) surveys as well as GOS surveys and Program reviews.

    SELTs are an important source of information to inform individual teaching practice, decisions about teaching duties, and course and program curriculum design. They enable the University to assess how effectively its learning environments and teaching practices facilitate student engagement and learning outcomes. Under the current SELT Policy (http://www.adelaide.edu.au/policies/101/) course SELTs are mandated and must be conducted at the conclusion of each term/semester/trimester for every course offering. Feedback on issues raised through course SELT surveys is made available to enrolled students through various resources (e.g. MyUni). In addition aggregated course SELT data is available.

  • Student Support
  • Policies & Guidelines
  • Fraud Awareness

    Students are reminded that in order to maintain the academic integrity of all programs and courses, the university has a zero-tolerance approach to students offering money or significant value goods or services to any staff member who is involved in their teaching or assessment. Students offering lecturers or tutors or professional staff anything more than a small token of appreciation is totally unacceptable, in any circumstances. Staff members are obliged to report all such incidents to their supervisor/manager, who will refer them for action under the university's student’s disciplinary procedures.

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