20841 - MONETARY POLICY AND FINANCIAL REGULATION

By the early 2000s an increasing numbers of countries had adopted a well-defined central bank framework, which is characterized by two intertwined features: the authority becomes specialized in achieving the monetary policy goals, and consequently its traditional responsibilities in pursuing the financial stability are less important in its institutional perimeter. But then, after the Great Crisis, reforms are undertaken and projects are under discussion in order to reassess the central bank role, motivating an overall reconsideration of the relationships between conventional and unconventional monetary policy on the one hand and banking regulation and supervision on the other, with specific attention to Europe and US. The course is devoted to a better understanding of the policy drivers, adopting a multi-disciplinary approach: economics, new political economy and history.

• Economics, Political Economy, History. A Positive Sum Game.
• Central Banking as an Evolving  Mix of Monetary Policy, Fiscal Policy and Financial Regulation and Supervision.
• Today Central Banking: Normal Times, Extraordinary Times, New Normal Times.
• Backward Looking to Go Ahead: Classic View, Traditional View, Modern View.

analyse  the intertwined  relationships  among conventional  monetary policy, fiscal policy, banking regulation and supervision using  economics, new political economy and history as knowledge  tools.

apply her/his the above mentioned knowledge in discussing what is going on in terms of  central bank strategies.

• Face-to-face lectures

Lecture notes, slides and videos represent the teaching material, which is already on the website of the course.

Individual written exam, in person on student’s personal PCs, with open-ended questions. It’s a closed book examination. No calculator. No scratch papers. The exam is worth 30/30. Duration: sixty minutes. The exam is composed of three open-ended questions. Answer all questions. Each 2 question is worth 10 points. Only truly outstanding exams deserves laude (1 point). You must always motivate your answers, using principles and concepts drawn from our lecture notes and slides, that shall be explained and described: exams verify knowledge, not memory. Answers without explanation will not be evaluated (zero points). You must answer only with words; equations and graphs are not needed. Equations can be used to strengthen words, but not to substitute them. Any kind of mistake and/or omission is an error, that worth at least 1 point.

Lecture notes, slides and videos represent the teaching material, which will be available on the website of the course.

OTHER (NON COMPULSORY) REFERENCES                

              Articles:

• Masciandaro D. (2021), Central Bank Governance in Monetary Policy Economics (1981-2020),  Bocconi University, Baffi Carefin Working Paper Series, forthcoming.

·       Masciandaro D. and Quintyn M. (2015). The Governance of Financial Supervision: Recent Developments,  Journal of Economic Surveys, Vol.29 , 1-25.

·       Masciandaro  D. and Romelli D. (2015). Ups and Downs. Central Bank Independence from the Great Inflation to the Great Recession, Financial History Review, December, 1-31.