OverviewThis module is designed to introduce to the main theoretical and empirical models of international financial relations. Exchange rates, capital flows, financial crises, current account and debt dynamics as well as uncertainty are the most widely debated economic topics in the media and on the political arena. This module provides the economic foundations for full understanding of these debates from a rigorous point of view. The module is evenly balanced between the theory and empirical evidence. That is, we focus not only on the analytical side of the stories but also on their empirical relevance.
For working in the areas of financial economics and development (whether in private or public institutions) the knowledge of the topics addressed in this module is of paramount importance.
This module appears in:
30 hours of academic teaching in the form of lectures and seminars
Method of assessment
20% Essay (2,000 words)
80% Examination (2 hours)
• León-Ledesma, Miguel and Alexander Mihailov. Advanced International Macroeconomics and Finance. Oxford University Press, 2018
• Schmitt-Grohe, Stephanie, Uribe, Martin, and Michael Woodford. International Macroeconomics. Princeton University Press, 2016
• Schmitt-Grohe, Stephanie and Martin Uribe. Open economy macroeconomics. Princeton University Press, 2017
• Sarno, Lucio, and Mark Taylor. The Economics of Exchange Rates. Cambridge University Press, 2002
• Obstfeld, Maurice, and Kenneth Rogoff. Foundations of International Macroeconomics. MIT Press, 1996
On successfully completing the module students will be able to:
• comprehensively understand how the openness of economies affects their economic performance, accounting for complex institutional arrangements that exist in the contemporary world economy
• critically assess determination of exchange rates and systematically study the sources of exchange rate fluctuations
• deeply assess the causes and consequences of international capital movements as well as recent trends in 'globalisation', and acknowledge how these transform our understanding of such controversial phenomena as financial bubbles, speculative attacks, and currency crises
• critically address the concept of intertemporal trade and risk diversification using the synthesis of existing advanced theories
• demonstrate profound knowledge of the history of the international monetary system.
• write essays on advanced topics with high level of abstraction and develop convincing argumentation in seminar debates on controversial matters.
• solve complex analytical and numerical problems through the use of the different models studied within the curriculum
• comprehensively understand core agenda of institutions that oversee and regulate international capital flows and investment activity