Universität Wien

290016 VU Special Topics in Economics (2014W)

Macroeconomics: Open Goods and Financial Markets from an Economics Perspective

3.00 ECTS (2.00 SWS), SPL 29 - Geographie
Continuous assessment of course work
Moodle

Registration/Deregistration

Note: The time of your registration within the registration period has no effect on the allocation of places (no first come, first served).

Details

max. 50 participants
Language: German

Lecturers

Classes (iCal) - next class is marked with N

  • Monday 27.10. 18:00 - 20:30 Hörsaal 4C Geographie NIG 4.OG C0409
  • Saturday 08.11. 08:00 - 13:00 Hörsaal 4C Geographie NIG 4.OG C0409
  • Monday 10.11. 18:00 - 20:30 Hörsaal 4C Geographie NIG 4.OG C0409
  • Monday 24.11. 18:00 - 20:30 Hörsaal 4C Geographie NIG 4.OG C0409
  • Saturday 13.12. 08:00 - 13:00 Hörsaal 4C Geographie NIG 4.OG C0409
  • Monday 15.12. 18:00 - 20:30 Hörsaal 4C Geographie NIG 4.OG C0409
  • Saturday 17.01. 08:00 - 13:00 Hörsaal 4C Geographie NIG 4.OG C0409
  • Monday 26.01. 18:00 - 20:30 Hörsaal 4C Geographie NIG 4.OG C0409

Information

Aims, contents and method of the course

The increase in the internationalisation of goods and financial markets implies a heightened importance in understanding the mechanisms of real and monetary open economics. To significant extent current economic structures --- especially in a small open economy like Austria --- are related to external trade. Exchange rates, export and import ratios, foreign direct investments, currency pegs, etc. are frequently used catch phrases, which have to be put into perspective and be underpinned with economic theory.

Part 1: Introduction and Recap: Exchange Rates, the Balance of Payments

Real and nominal exchange rates, price and quantity quotations, effective exchange rates, purchasing power parity, import and export ratios, the current and capital account.

Part 2: The IS-LM Model in a closed economy

Equilibria on the goods and financial market, limits tot he IS-LM Model

Part 3: Advancing the goods model to account for foreign trade

Export and imports, drivers and causes for international trade, implications on the equilibrium on the goods market.

Part 4: Advancing the financial model to account for cross border transactions

Interest rate parity, exchange rate policies and regimes. Why does the expectation of an interest rate increase in the US pressurize currencies of developing countries?

Part 5: Consolidation of open goods and financial markets in the Mundell-Flemming Model

Effects of fiscal and monetary policy under fixed and free exchange rates, implications from a business cycle perspective, interaction in a 2-state model, limits of the model

Part 6: Factor mobility

Drivers and consequences of foreign direct investment, cross border mobility of the factors labour and capital

Part7 : Advanced topics in international macroeconomics

Depending on time and interest of students

Case studies: currency crises of Argentina 1998-2002 and Mexico 1994-1995

US current account deficit: dark matter theory in economics or the sword of Damocles

Optimum currency areas vs. the Euro Area

Foreign currency loans: background and consequences

Drivers of foreign exchange in detail: the mechanism of comparative advantage (Riccardo), diverging factor endowments in the Heckscher-Ohlin Model, preference for a variety of goods and monopolistic competition in Krugman’s approach

Assessment and permitted materials

positive mid- and endtermtest; preperation of literature on the basis of questions; written answers to questions for each meeting.

Minimum requirements and assessment criteria

The course aims at providing an understanding of the central interactions between interest rates, goods and financial transactions, exchange rates, monetary reserves and business cycle policy. Successful participants know the balance of payments, are able e.g. to judge on the consequences of monetary policy on exchange rates and to explain the mechanics.

Examination topics

Teaching consists of one unbroken 90 minute unit weekly. Each unit consists of lectures and contributions by students. Students are required to read and prepare the literature provided for each meeting on the basis of questions distributed previously. Answers of questions have to be in writing and have to be handed in at the beginning of each meeting

Reading list

Blanchard, O. und Illing, G. (2009). Makroökonomie. Pearson Studium.

Krugman, P., Obstfeld, M. und M, M (2011). Internationale Wirtschaft: Theorie und Politik. Pearson Studium.

Breuss, F. (2003). Reale Außenwirtschaft und Europäische Integration. Peter Lang Pub Incorporated.

Rübel, G. (2004). Grundlagen der realen Außenwirtschaft. Internationale Standardlehrbücher der Wirtschafts- und Sozialwissenschaften. Oldenbourg.

Rübel, G. (2005). Grundlagen der monetären Außenwirtschaft. Internationale Standardlehrbücher der Wirtschafts- und Sozialwissenschaften. Oldenbourg.

Siebert, H. (1994). Außenwirtschaft. UTB für Wissenschaft : Uni-Taschenbücher: Große Reihe. Fischer.

Association in the course directory

(L2-e1)

Last modified: Mo 07.09.2020 15:42