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University of Alberta Department of Economics
ECON 422 – A2: International Payments
Instructor: Dr. Abdul Aleem Office: Tory 7 – 20
Email: [email protected]
Fall term 2015 Class Times: MWF 9:00AM - 9:50AM Classroom: T 1 108 Office hours: TTH 9:00AM – 10:00AM or by Appointment
Course Objectives
This course provides an advanced undergraduate treatment of types of international transactions, macroeconomics in an open economy, exchange rates, balance of payments adjustments, and other issues in the international monetary system.
Prerequisites: ECON 281, ECON 282 and MATH 113 or SCI 100 or consent of Department.
eClass
eClass can be accessed via the homepage at www.elearning.ualberta.ca. It is accessed with the same login and password that you were assigned for your University of Alberta email account. Here you will find the course outline, lecture notes, assignment as well as past exams.
Course Texts
“International Finance: Theory & Policy” by Krugman, Obstfeld and Melitz (10th edition)
“International Macroeconomics” by Feenstra and Taylor (3rd edition)
I have requested that the two textbooks be put on reserve in Rutherford library. If addition material is required, it will be made available on the course web-site, when possible, or on Reserve in Rutherford library.
Note: I will follow the textbook, in general, but will probably cover material in the lectures that is not covered in the text.
Tentative Schedule
Topics and reading may be added or deleted as the term progresses. The order of topics may also be changed. KOM is an abbreviation for Krugman, Obstfeld and Melitz. FT is an abbreviation for Feenstra and Taylor.
2 1. Exchange rates and open-economy macroeconomics
1.1 National Income Account and the Balance of Payments KOM Chapter 2 1.2 Exchange Rates and the Foreign Exchange Market: An Asset Approach KOM Chapter 3
1.3 Money, Interest Rates, and Exchange Rates KOM Chapter 4
1.4 Price Levels and the Exchange Rate in the Long Run KOM Chapter 5 1.5 Output and the Exchange Rate in the Short Run KOM Chapter 6 1.6 Fixed Exchange Rates and Foreign Exchange Intervention KOM Chapter 7
2. International macroeconomic policy
2.1 International Monetary Systems: An Historical Overview KOM Chapter 8 2.2 Exchange rate crises: How pegs work and how they break FT Chapter 9
2.3 Optimum Currency Areas and the Euro KOM Chapter 10
2.4 Developing Countries: Growth, Crisis, and Reform KOM Chapter 11
Assessment
You will be graded on an assignment, a mid-term test and a comprehensive final. Mid-term and final exams will consist of both short answer questions and long answer questions, and may involve the manipulation of diagrams. It is important to note that the material in the lectures is important as my exams tend to be closely related to the material I cover in class. There will be no choice of questions on either exam. Comprehensive final exam will cover all topics in the term.
In test situations, you will need pens, pencils, erasers, a non-programmable calculator (or a calculator that is easy to reset), and your student ID. Cell phones, electronic translators, and other electronic devices are not permitted into tests/exams. The exams are of the closed book type. No notes can be consulted during the exams.
Make-up exams will not be allowed for the mid-term term exam. A student who misses the midterm because of health, bereavement or other extenuating circumstances that are substantiated or otherwise deemed valid by the instructor will have the weight of the test transferred to the final test.
Marking
Grades will be based on: Date Total
Assignment November 6, 2014 10%
Mid-term exam (in class) October 23, 2014 40%
Final exam (Cumulative)* December 18, 2015 @ 9:00 a.m. 50%
*Please confirm the final exam date when exam dates are finalized by the University.
3 Marking System
The following system will be used to translate grades to the 4.0 grading system:
A+ 4.0 90-100 C+ 2.3 60-64
A 4.0 85-89 C 2.0 55-59
A- 3.7 80-84 C- 1.7 50-54
B+ 3.3 75-79 D+ 1.3 45-49
B 3.0 70-74 D 1.0 40-44
B- 2.7 65-69 F 0.0 0-39
UNIVERSITY POLICIES (i) Academic Integrity
“The University of Alberta is committed to the highest standards of academic integrity and honesty.
Students are expected to be familiar with these standards regarding academic honesty and to uphold the policies of the University in this respect. Students are particularly urged to familiarize themselves with the provisions of the Code of Student Behaviour (online at www.ualberta.ca/governance/studentappeals.cfm) and avoid any behaviour which could potentially result in suspicions of cheating, plagiarism, misrepresentation of facts and/or participation in an offence. Academic dishonesty is a serious offence and can result in suspension or expulsion from the University.” (GFC 29 SEP 2003)
Because of the seriousness of plagiarism and cheating, students are advised that the Code of Student Behaviour is published in the Calendar (pages 787-807) and should be reviewed since ignorance is not acceptable as a defense in cases of academic offences. Students should be informed that when cheating and/or plagiarism occurs, a number of sanctions can be imposed, such as lowering a grade or expulsion from the University (outlined in Section 30.4.2 of the Code).
In particular, please note:
No student shall represent another’s substantial editorial or compositional assistance on an assignment as their own.
No student shall submit in any course or program of study, without the written approval of the course instructor, all or a substantial portion of any academic writing, essay, thesis, research report, project assignment, presentation or poster for which credit has been obtained by the Student or which has previously been or is being submitted by the Student in another course or program of study in the University or elsewhere.
Students should refer to Section 30.2.2 in “Extract from the Code of Student Behavior” available at the website link in above. Also, please see
www.governance.ualberta.ca/StudentsAppeals/DontCheatsheet.aspx.
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You must be prepared to show your student ID card at both the midterm and the final exam.
(ii) Course Outlines
“Policy about course outlines can be found in ' 23.4(2) of the University Calendar.” (GFC 29 SEP 2003).
(iii) Renumbered courses
This course has not been renumbered.
(iv) Audio or video recording of lectures, labs, seminars or any other teaching environment by students is allowed only with the prior written consent of the instructor or as part of an approved accommodation plan.
Recorded material is to be used solely for personal study, and is not to be used or distributed for any other purpose without prior written consent of the instructor.