ECONOMICS
MACROECONOMICS IN THE GLOBAL ECONOMY

CD3 Syllabus                                                                           Course Structure Index
Professor Chi Zhang

Course Description

This course studies macroeconomic issues and policy in an open economy context. The objective is to facilitate students with functional frameworks to thoroughly understand macroeconomic arguments and use the theory for the analysis of the various international macroeconomic issues and events. The course covers foreign exchange market, balance of payments and adjustment, macroeconomic policy in the open economy, international monetary system and global capital market.

The course is based on the assumption that students are familiar with macroeconomics at the undergraduate level. Students who need to review basic macroeconomics should read thoroughly Part I, II, and III of Dornbusch and Fischer or Eugene A. Duilio.

To emphasize application and analytical skills, the lecture of the theories will be accompanied by empirical and case studies of current issues. Students are encouraged to participate in discussions.

Course Requirements and Student Assessment

Your grade will be based on your performance on the final exam, one essay, problem sets and class participation.

Examination - 40 percent of grade

There will be a final exam on the last class of the module. The exam accounts for 40 percent of the overall grade. No make-ups will be given for the exam unless a student experiences a medical or family emergency and notifies the professor before the exam is given.

Essay - 30 percent of grade

You will be required to write an essay during the course. It is to be no more than 5,000 words. This paper will analyze the external payments situation of a country of your choice. The essay must give a clear economic analysis of the issue and macroeconomic policy implications and/or recommendations.

Homework Problem Sets - 20 percent of grade

There are 2 homework problem sets, each of which is worth 10 percent of the course grade. You will be given a schedule of due dates for these assignments. Homework assignments are due in class on the due date. Assignments handed in late will be subject to penalties.

Class Participation - 10 percent of grade

With your input, I will assess your contributions to case discussion, as well as general class discussion, both for quantity and quality.

Course Materials

Paul Krugman and Maurice Obstfeld, International Economics: Theory and Policy, 3^rd edition, HarperCollins Publishers Inc., 1994.

Dominique Salvatore, International Economics, 5^th edition, Prentice Hall, 1995.

Rudiger Dornbusch and Stanley Fischer, Macroeconomics, 6^th edition, McGraw‑Hill Book Company, 1994.

Eugene Diulio, Macroeconomic Theory, 2^nd edition, Schaum’s outline series, McGraw-Hill Book Company, 1990 (ED)

Readings from journal articles will be assigned during the module.

Topics

The module will start by briefly review the macroeconomic and policy concerns in a closed economic Looking at the open economy, the module will cover balance of payments accounting, exchange rate and foreign exchange market, theories of exchange rate determination, macroeconomic policy and balance of payments adjustment under fixed and flexible exchange rate. The development of International monetary system and global capital market will also be discussed.