Course 2024-2025 a.y.

Classes: 31 (II sem.)

Instructors:
Class 31: ROBERTO PEROTTI

This is a course on international economics. It deals with many aspects of the economic interactions between countries. Unlike the other course I teach, “Monetary and fiscal policy: current challenges”, it is more advanced and more grounded in theory. However, it is not purely theoretical: all topics are illustrated by real life applications and recent examples from different countries. The course also focuses on policies, in particular the implications of different monetary and fiscal policies in open economies.

 

I will use two books. The first is a textbook: International Economics - Theory and Policy, 12th Edition, by Paul Krugman, Marc Melitz, and Maurice Obstfeld, published by Pearson. The second is: A Crash Course on Crises: Macroeconomic Concepts for Run-Ups, Collapses, and Recoveries, by Markus Brunnermeier and Ricardo Reis, Princeton University Press, 2023 (available on Kindle store). 

Specifically, I will cover the second part of the textbook, from chapter 13 to chapter 22, which covers international finance and macroeconomics (chapters 1 to 12 cover international trade). Some of you might have seen already some of the chapters we will cover. However, for reasons that I will discuss in class this is at the moment the best textbook available on the topic, and it is better to refresh your memory on a good textbook than to study new material on a not-so-good textbook. We will also use several chapters of the Brunnermeier and Reis book, that I will indicate along the way.

Finally, we will also use several articles from the Financial Times and from the Economist as applications of the issues learned in class. I will also post these articles along the way.

Important: for each class, I will provide classnotes / slides in advance. In many, probably most, topics they can depart substantially from the textbook. You should consider the classnotes / slides the main teaching material of the course.

 

 

 

At the end of the course student will be able to...

At the end of the course student will be able to...

• Lectures
• Individual works / Assignments

Attending and non-attending students will have to take the same exam.

The plan of the course is quite intense as it is, hence there will be no time for students’ presentations. However, all students are strongly encouraged to actively participate in class (either physically in the classroom or online from home). You can interrupt me at any time, to ask for clarifications, make comments, express agreement or disagreement, and the like,

I will not take down attendance. However, your attendance  is fundamental. I will emphasize and expand some parts of the book and instead skip  other parts, and I will discuss actual examples and applications that might not be in the textbook.  If you do not attend classes, you will not be able to understand what is important and what is less important, and might miss important discussions. 

Unless otherwise indicated, all and only the material covered in class will be material for the exam.

	Continuous assessment	Partial exams	General exam
Written individual exam (traditional/online)		x	x

There will be a midterm exam and a final exam. The midterm is optional. If you take the midterm you then can decide to take the second partial at the end of the course or to discard the midterm grade and take the general at the end of the course. If you take the midterms and the second partial, to pass the exam  you will need an average of 18 and a grade of at least 16 in both the midterm and the second partial. Each midterm counts for 50 percent of the grade. The final exam will last between one hour and one hour and  half. The midterm and the second partial will be shorter.

 

The exam will consist of  a mix of some or all types of questions below.

1.       True, False or Uncertain. You will be asked to state whether a certain statement  is true, false or uncertain. You will have to justify your answer in a concise but comprehensive manner. You will have to provide the explanation, formal or intuitive or both, of the main arguments. You will also be asked to define exactly the main terms you use

2.       Short open questions. 

3.       Short essay. This must be a short but exhaustive essay on a question that we have studied in class

4.       A short formal problem. There could be a question that asks you to solve a formal problem, using the few equations  or graphs that we study in class. This could be exactly a model we have studied in class or a very small variation on it.

The material consists of

(i) the textbook and the other book indicated above.

(ii) For each class, I will provide classnotes / slides in advance. In many, probably most, topics they can depart substantially from the textbook. You should consider the classnotes / slides the main teaching material of the course.

(iii) Several articles from the Financial Times and from the Economist as applications of the issues learned in class. I will also post these articles along the way.