| Delivery Type | Delivery length / details |
|---|---|
| Seminars / Tutorials | 4 Hours. |
| Lecture | 11 Hours. |
| Assessment Type | Assessment length / details | Proportion |
|---|---|---|
| Semester Assessment | 1 piece of coursework | 20% |
| Semester Exam | 1.5 Hours | 80% |
| Supplementary Assessment | 1.5 Hours examination and/or resubmission of coursework | 100% |
On successful completion of this module students should be able to:
Through lecture presentation, seminar discussion and reading (see below) you should grasp a firm understanding of recent work by economists to explain the importance of the exchange rate to the domestic economy and how it relates foreign economies to the domestic economy and what causes exchange rates to "overshoot" their long-run levels. You should also be able to explain the sources of rigidities in the economy and their role and importance in explaining unemployment and macroeconomic fluctuations. Specifically you should gain a working understanding of the following topics:
* The various models of exchange rate determination and relationships between the exchange rate and macroeconomy, such as purchasing parity and uncovered interest parity.
* The importance of the monetary model of the exchange rate and the Dornbusch sticky price model.
* Real Business Cycle theories, and whether economic fluctuations can be explained by technology shocks
* Models of efficiency wages and insider-outsiders, and how they may contribute to real wage rigidity and unemployment
* Theories of nominal price rigidity, and whether they can explain economic fluctuations
From these you should also be able to gain an understanding of how the open economy operates and how particular types of behaviour in response to uncertainty and market imperfection lead to detrimental aggregate effects on the economy. In turn you should be able to further inform your ideas and views on the debate surrounding the effectiveness of macroeconomic policy.
The module aims to teach more advanced topics in the macroeconomic analysis of the open economy and economic fluctuations. Students will be taught the main models of exchange rate determination and the macroeconomic implications of "non-competitive" or "non-optimising" forms of behaviour by households, as consumers and suppliers of labour, and by firms as price-setters and as users of labour. The module will contrast the ideal "New-Classical" world with "New-Keynesian" theories, and so address the important question of macroeconomic policy effectiveness.
This module presents some advanced macroeconomic models and theories, concentrating on the main open economy models and the new Keynesian approach to economies.
This module is at CQFW Level 6