Newcastle University

Aims

To provide students with an advanced understanding of role of money and banking institutions in the international economy.

Original Summary:
The module aims at providing the theoretical basis and empirical evidence for understanding the basic functioning of international financial markets and institutions. It starts with providing a through analysis of the international financial system, it then concentrates on issues related to money and banking, such as money supply, money demand, and the determination of interest rates and exchange rates. Is analyses both theoretical underpinnings and empirical evidence of the aforementioned aspects of international money.

Outline Of Syllabus

1. Introduction: Money, banking, and financial markets
2. Money 1: The functions of money, the demand for money,
3. Money 2: Multiple deposit creation and the money supply process, the role of central banks
4. Interest rates 1: The behaviour of interest rates
5. Interest rates 2: The risk and term structure of interest rates
6. International finance: The foreign exchange market, exchange rate regimes
7. The foreign exchange market: Determination of exchange rates
8. Empirical international finance: Evaluation of findings on money demand, the structure of interest rates, and the theories of exchange rate determination

Teaching Rationale And Relationship

- Lectures provide the basic structure of the methods and theories that are introduced and an overview of the current issues
- Seminars provide an opportunity to enhance understanding of the theoretical aspects of the module.

Assessment Rationale And Relationship

The examination tests understanding of the theoretical and current issues in money and banking.