International Finance II

Class 1. Introduction to the course Part A: Banking and sovereign debt crises Class A1. Overview of economic and financial crises Class A2. Banking crisis: bank run Class A3. Too big to fail problem Class A4. Sovereign debt crisis Class A5. Twin and Triple crises: global financial crisis Class A6: International financial system and globalization Part B: Currency and BOP crises Class B1. Empirical facts on currency attacks and sudden stops Class B2. Introduction to the 1st generation models Class B3. Overview of the 2nd generation models Class B4. A two-good small-open economy (SOE) model of a sudden stop Class B5. A two-good SOE model with a collateral constraint Class B6. Pecuniary externality and policy intervention (subject to change) Class 14. Final exam

Lecture (discussions encouraged)

Class participation and exams

No textbook

Mark Aguiar and Manuel Amador, 2021, The Economics of Sovereign Debt and Default (Princeton University Press). Stijn Claessens, M. Ayhan Kose, Luc Laeven, and Fabian Valencia ed., 2014, Financial Crisis: Causes, Consequences, and Policy Response (IMF). Maurice Obstfeld and Ken Rogoff 1996, Foundation of International Macroconomics (MIT Press). Martin Uribe and Stephanie Schmitt-Grohé, 2017, Open Economy Macroeconomics (Princeton University Press). Carlos A. Vegh, 2013, Open Economy Macroeconomics in Developing Countries (MIT Press).

Basic understanding of micro and macroeconomics as well as statistical methods / econometrics are necessary. A prerequisite is Macroeconomics for Public Policy (or its equivalent). Strongly recommended to have taken or to take International Financial Policy.