ECON 7100 - International Finance IV

North Terrace Campus - Semester 2 - 2014

This course typically deals with (i) the determinants of a country's current account; (ii) the importance of financial markets imperfections for international risk-sharing; (iii) sovereign debt and default; (iv) financial crises, including currency and banking crises, and their contagion.

  • General Course Information
    Course Details
    Course Code ECON 7100
    Course International Finance IV
    Coordinating Unit School of Economics
    Term Semester 2
    Level Postgraduate Coursework
    Location/s North Terrace Campus
    Units 3
    Contact Up to 4 hours per week
    Prerequisites ECON 7011, ECON 7071 or ECON 7044
    Restrictions Available to MAppEc, MAppEc (Int), MAppEc(PubPol), MEc(Coursework) & MHealthEcPol students only
    Course Description This course typically deals with (i) the determinants of a country's current account; (ii) the importance of financial markets imperfections for international risk-sharing; (iii) sovereign debt and default; (iv) financial crises, including currency and banking crises, and their contagion.
    Course Staff

    Course Coordinator: Dr Colin Rogers

    Office hours: Thursday 2-3 pm and by appointment
    Office location: Nexus 10, Level 3, Room 3.26
    Phone:  831 34394
    Course Timetable

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

    Lectures will be held in Engineering North N 132 from 2-5 pm each Thursday during teaching weeks.
  • Learning Outcomes
    Course Learning Outcomes
    For  2014 the purpose of this course is to understand the problems and challenges facing the international monetary and finacial system in in 2014 and beyond. 

    To that end the course adopts both a historical and theoretical perspective examining the evolution of the system from the gold standard, via the Bretton Woods system to the current non-system post 1971.

    Topics covered include the flawed return to gold in 1926, the flawed structure adopted at Bretton Woods, some of the many crises experienced in Latin America in the 1970s and 1980s, the Asian Crisis of 1988/9, the GFC of 2008 and ultimately to the flawed design of the Euro.

    Examination of these cases reveals that important theoretical and policy lessons have not been learnt. 

    The course concludes with an assessment of the challenges facing the international monetary system in 2014 and considers some options for what should be done.

    On successful completion of this course students will be able to:
    1 Understand the flaws in the gold standard and why it is never a sustainable monetary system.
    2 Understand the flaws in the design of the Bretton Woods system and why it was bound to fail.
    3 Be familair with the specific crises covered on the course, their causes and the general theoretical principles that explain why they occurred and how they can be avoided in future.
    4 Understand the domestic and international causes of the global financial crisis of 2008.
    5 Understand the flaw in the design of the euro and why the austerity approach of the surplus countries may lead to the break up of the euro-zone.
    6 Be familar with the challenges facing the international monetary system in 2014 and the options availabe for the IMF and groups like the G20 or the European commission and the European Central Bank.
    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. 1,2,3,4,5,6
    The ability to locate, analyse, evaluate and synthesise information from a wide variety of sources in a planned and timely manner. 1,2,3,4,5,6
    An ability to apply effective, creative and innovative solutions, both independently and cooperatively, to current and future problems. 2,3,4,5,6
    Skills of a high order in interpersonal understanding, teamwork and communication. 6
    A proficiency in the appropriate use of contemporary technologies. 6
    A commitment to continuous learning and the capacity to maintain intellectual curiosity throughout life. 2,3,4,5,6
    A commitment to the highest standards of professional endeavour and the ability to take a leadership role in the community. 4.5.6
    An awareness of ethical, social and cultural issues within a global context and their importance in the exercise of professional skills and responsibilities. 4,5,6
  • Learning Resources
    Required Resources
    Prescribed references (marked thus *) specific to each topic will be provided for each lecture and placed on the topic outlines on MyUni.
    Recommended Resources
    Useful background reading is provided by:

    Kindelberger Charles, P. and Aliber, Robert, Z, Manias, Panics and Crashes: A History of Financial Crises, John Wiley & Sons, Inc., 2005

    Liaquat Ahmed, Lords of Finance: The bankers who broke the world, Penguin, 2009.
    Online Learning
    Useful online resources include the articles posted on Project Syndicate, and Vox and working papers by the IMF and the Bank of International Settlements (BIS).
  • Learning & Teaching Activities
    Learning & Teaching Modes

    All students must attend the lectures held 3-5 pm every Thursday starting 31 July in Engineering Nth, N132, Lecture Theatre.

    In addition at least 10 hours a week should be allocated for study of the material provided. 

    Two early assignments and the essay are intended to provide feedback on the style and mode of analysis expected on this course and to prepare students for the form of the examination questions.

    Workload

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

    Students should allocate 10 hours a week to this topic in addition to the 2 hour lecture.
    Learning Activities Summary
    TOPICS:
    Week 1 Why is the international monetary system in such a mess? Overview of the GFC and Euro crisis.
    Week 2 Back to basics - properties of the gold standard; pure and managed.
    Week 3 The flawed return to gold in the 1920s - what lessons should we learn?
    Week 4 Another flawed system - Bretton Woods: designed to fail?
    Week 5 The collapse of Bretton Woods and the aftermath - what is the role of IMF in a non-system?
    Week 6 The Mexican crisis of 1982 and 1994.
    Week 7 The Asian crisis of 1997/98.
    Week 8 The Argentinian crisis of 2001.
    Week 9 The Global financial crisis of 2007/2008: causes and rededies.
    Week 10 The Euro crisis of 2010: causes and remedies.
    Week 11 Theoretical lessons from economic history.
    Week 12 What is the way forward in 2014? - the Euro, Emerging Market economies and the international monetary system.
  • 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
    Assignment 1            5%

    Assignment 2            5%

    Essay                      20%

    Final Exam              70%

    The two assignments and the essay are compulsory and NOT redeemable by increasing the weight on the exam as they form an essentail part of preparation for that exam. 

    Late assignments will NOT be accepted without a medical certificate.

    The final exam will cover the entire course, including all material in the lectures and prescribed (*) readings.

    Assessment marks prior to the final exam will be displayed on the course website. Students should check their marks and notify the lecturer of any discrepencies.
    Assessment Related Requirements
    Assignment 1:   

    Due date:  End of week 3;

    Topic:  Explain wht the gold standard is and idealised monetray system that is not sustainable.

    Word limit 800 words.


    Assignment 2:  

    Due date: End of week 5;

    Topic: Was Robert Triffin right about the flaws in the Bretton Woods system? 

    Word limit - 800 words.


    Essay topic: TBA

    Due date: End of week 9;

    Word limit - 3000 words
    Assessment Detail

    No information currently available.

    Submission
    Assigments should be submitted in electronic format (typed) to my e-mail account by 9.00am Monday morning of the week following their designated submission week. For example assignment 1 is due by 9.00am Monday morning of week 4.

    The assignments and essay will be returned promptly pointing out any major omissions of important material and with suggestions on how presentation can be improved.
    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.

  • 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

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