Economics 441/541-001: International Monetary Theory and Policy (Winter, 2017)
Course Time and Place: TTh 10:00 – 11:50, Cramer Hall 324
Instructor: Hiro Ito, Professor of Economics
Office: Cramer Hall 241-F
Phone: x5 – 3930
Office Hours: TTh 12:00-13:00, or by appointment
OHs: Monday: 1 – 4pm; Tuesday, Thursday: 1 – 2pm
The required textbook for this course is:
Krugman, Paul, Maurice Obstfeld, and Marc Melitz, International Economics – Theory and Policy, Ninth Edition. Addison Wesley (KOM).
If you desire or need to brush up your introductory or intermediate macro, the following standard textbooks are suitable.
If you are interested in exploring more
advanced material, you are highly encouraged to read Feenstra
Other reading materials such as journal and magazine articles are occasionally distributed in class or available on this page.
Class schedule and reading assignments
The readings with an asterisk are required, and those with § are required for graduate students.
Introduction and review of macroeconomics
<for review> Baumol & Blinder (BB): Ch. 7,8,10,12,13 & 17; Blanchard(B): Ch. 18
*Krugman, Obstfeld, Melitz (KOM): Ch. 13
National Income Accounting and the Balance of Payments
*KOM: Ch. 6 Section on International Borrowing and Lending and Appendix
Review on Ch. 6, 13 – 17
February 16 (Thursday): Midterm Exam (Ch. 6, 13-17)
*KOM: Ch. 18 Fixed Exchange Rates and Foreign Exchange Intervention
*KOM: Ch. 19 The International Monetary System: A Historical Overview
§Nurkse, R. (1945). “Conditions of International Money Equilibrium,” Essays in International Finance, No. 4 (Spring). (To be distributed in class)
§Krugman, P. (1993). “What Do We Need to Know About the International Monetary System?” Essays in International Finance, No. 4 (July). (distributed)
Eichengreen, B. A. Rose, and C. Wyplosz (1994). “Speculative Attacks on Pegged Exchange Rates: An Empirical Exploration with Special Reference to the European Monetary System,” NBER Working Paper #4898. (CW)
"Reading the Future of the Internationalization of the Renminbi and its Acceptance as a SDR Currency," Research Institute of Economy, Trade, and Industry Column 327 (in both English and Japanese; January 19, 2016).
"Limitations of the International Monetary System and the Rise of China’s Renminbi," Research Institute of Economy, Trade, and Industry Column 317 (in both English and Japanese; August 17, 2015).
Weeks 9 and 10
*KOM: Ch. 22 Developing Countries: Growth, Crisis, and Reform
*Aizenman, J. and Hiro Ito. 2013. “The Impossible Trinity, the International Monetary Framework and the Pacific Rim”. In I. N. Kaur and N. Singh ed., Handbook of the Economics of the Pacific Rim (Oxford University Press, 2013).
§Kaminsky, Graciela L. and Carmen M. Reinhart (1999). “The Twin Crises: The Causes of Banking and Balance-Of-Payments Problems” American Economic Review, Vol. 89, No. 3 (June), pp. 473-500.
*Coden, Max (2007). “The International Current Account Imbalances: A Sceptical View,” Economic Affairs, 2007, vol. 27, issue 2, pages 44-48.
*Valderrama, D. (2008). “Are Global Imbalances Due to Financial Underdevelopment in Emerging Economies?” FRBSF Economic Letter. Number 2008-12,April 11.
The final exam will be held at 10:15 – 12:05 pm on March 21, Tuesday.
March 16, 2017