Course Catalogue

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Students are provided with an introduction to international finance in this course. We begin with an introduction of an open economy macro models, and then models of exchange rate determination. We also examine whether exchange rate models are consistent with actual exchange rate data. Next, we introduce an examination of the Balance of Payments and the use of the Balance of Payments for effective investments and risk diversification. Finally, we consider feasibility and effectiveness of macroeconomic policies depending on the type of exchange rate regime in operation.

Lectures: 10 x 2-hour lectures

Labs: 3 x 1-hour labs

Additional 1-hour revision lecture outside normal hours

University of Glasgow students must have achieved Subject Honours entry requirements as detailed below to enrol on this course. Permission is required for non-Economics students to take this course as an outside option.

A GPA of 12 (average C3) in Economics 2A and 2B with no course grade below D3, attained at the first attempt. A minimum grade of D3 in both ECON1012, Introductory Mathematics for Economists and ECON1013, Introductory Statistics for Economists unless exemptions were agreed on the basis of other courses taken in year 1. Refer to course specifications for details. These grades may be achieved at the second attempt.

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Reassessments are normally available for all courses, except those which contribute to the Honours classification. For non Honours courses, students are offered reassessment in all or any of the components of assessment if the satisfactory (threshold) grade for the overall course is not achieved at the first attempt. This is normally grade D3 for undergraduate students and grade C3 for postgraduate students. Exceptionally it may not be possible to offer reassessment of some coursework items, in which case the mark achieved at the first attempt will be counted towards the final course grade. Any such exceptions for this course are described below. 

The aims of this course are:

■ to analyse the workings of the international economy, in terms of capital movements;

■ to show how techniques of both macroeconomic and microeconomic analysis can be deployed in the context of an open economy;

■ to set out a coherent framework within which open economy macroeconomic policy, and exchange rate policy can be analysed.

By the end of this course, students should be able to:

1. analyse current issues in international economic policy by reference to alternative open economy macroeconomic models and alternative theories of exchange rate determination;

2. assess critically empirical studies of exchange rate determination;

3. show an ability to deploy theoretical principles to address practical issues and problems in international finance

4. communicate clearly using effective writing to impart information to specialists as well as non-specialists about economic analyses and findings

5. analyse and clearly present macroeconomic data, including using spreadsheet packages such as Excel.

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