ITF-220/ECON-1531 Spring 2010 Lecture Slides

Lecture Slides for ITF-220/ECON-1531
Spring 2012
The required textbook reading is the second half of World Trade and Payments, R.Caves, J.Frankel, and R.Jones, 10^th ed. (Addison-Wesley), 2007. (Available from The COOP, or on reserve at the KSG library.)

Topic	Chapter in World Trade & Payments	Lecture number	Lecture Date (approx.)
ELASTICITIES & THE TRADE BALANCE
Balance of payments accounting	15	1	Jan. 23
Supply and demand for foreign exchange	16.1	2	Jan. 25
Export and import elasticities; Empirical effects of devaluation on the trade balance	16.2	3	Jan. 30
CLICK HERE FOR L1-L3 SLIDES (combined file)
THE KEYNESIAN MODEL
National saving identity; fiscal multiplier in an open economy.	17.1- 17.2	4	Feb. 1
Export multiplier; & the transfer problem.	17.3-17.4	5	Feb. 6
Large-country repercussions; & Transmission of disturbances.	17.5-17.6 18.1	6	Feb. 8
Expenditure-reducing policies vs.-switching policies	18.2	7	Feb. 13
Monetary factors	18.3	8	Feb. 15
CLICK HERE FOR L7 and L8 SLIDES (combined file)
Topic	Chapter in World Trade & Payments	Lecture number	Lecture Date (approx.)
MONETARY APPROACH TO THE BALANCE OF PAYMENTS
Reserve flows & the gold standard	19.1 & Appendix A	9	Feb. 22
Purchasing Power Parity	19.2-19.4	10	Feb. 27
GLOBALIZATION OF FINANCIAL MARKETS
Liberalization; spot & forward exchange market	21.1-21.3	11	Feb. 29
Emerging Markets; Pros and Cons of financial opening	21.4 & 28.1 Ch. 21 Appendix	12	March 5
FISCAL AND MONETARY POLICY UNDER INTERNATIONAL CAPITAL MOBILITY
Mundell-Fleming -- with exchange rate fixed	22.1-22.3	13	March 7
Applications/problems of policymaking	22.4-22.7; 24.1	15	March 19
MIDTERM EXAM, Wednesday, March 21			March 21
Topic	Chapter in World Trade & Payments	Lecture number	Lecture Date (approx.)
Mundell-Fleming model - with the exchange rate floating	23.1-23.2	16	March 26
Perfect capital mobility & ImpossibleTrinity	23.3-23.4	17	March 28
Crises in emerging markets	24.2-24.5, 24.7-24.9	18	April 2
INTERDEPENDENCE AND COORDINATION
Effects of fiscal expansion in a large country Estimates of transmission International policy coordination	25.1 25.2 25.3	19	April 7
SUPPLY AND INFLATION
Aggregate Supply and wages	26.1	20	April 9
Inflation and anchors for money Exchange rate regimes and OCAs	26.3-26.4 26.5-26.6	21	April 11
EXPECTATIONS AND THE DETERMINATION OF THE EXCHANGE RATE
Interest parity conditions & the monetarist/Lucas model	27.1-27.2; 27.3	22	April 16
The overshooting model; forecasting	27.4-27.5; 27.6	23	April 18
Portfolio risk: foreign exchange risk and diversification	28.1-28.2	24	April 23
Portolio risk: sovereign default	28.3	25	April 25
Final Exam Thursday, May 3, 2012 2:00 - 5:00 p.m.