Money and Banking - ECO00076M

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  • Department: Economics and Related Studies
  • Module co-ordinator: Prof. Zaifu Yang
  • Credit value: 10 credits
  • Credit level: M
  • Academic year of delivery: 2019-20

Module summary

The module aims to provide students with an in-depth understanding of (global) banking systems, and their roles in the financial markets and current critical issues. We cover topics on management of commercial and investment banks, central banking and monetary policies, international banking, shadow banking and banking regulations and supervisions. This module also addresses fundamental banking issues, such as bank run, credit freeze, bubbles, and debt pricing.

Module will run

Occurrence Teaching cycle
A Spring Term 2019-20

Module aims

The first part of this module draws a big picture of the banking systems and introduces how the key players interact with the financial markets. Specifically, we cover topics on management of commercial and investment banks, central banking and monetary policies, international banking, shadow banking and banking regulations and supervisions. The second part of this module is more theoretical and focuses on several fundamental topics on banking and money. This modules aims at bringing students to the frontier research that address latest issues, such as bank run, credit freeze, bubbles, and debt pricing. We hope to enable students to have an in-depth understanding of critical banking issues.

Module learning outcomes

On completing the module, we expect the students to be capable of

  1. Understanding the general functioning of the banking systems;
  2. Evaluating the impacts of monetary policies and regulations;
  3. Mastering the principles and basic tools of banking management; and
  4. Having a bird-view of some frontier research concerning money and banking.

Assessment

Task Length % of module mark
University - closed examination
Money and Banking
2 hours 100

Special assessment rules

None

Reassessment

Task Length % of module mark
University - closed examination
Money and Banking
2 hours 100

Module feedback

Students will receive feedback following the work covered in the seminar and practical sessions.

Feedback will be given on the summative assessment within the time stated in the University's feedback policy.  Feedback will come in the form of a mark.  Students will also receive cohort feedback on the assessment and will have the opportunity to view their examination script at supervised sessions following release of the mark.

Indicative reading

Bebchuk Lucian and Itay Goldsterin (2011). ``Self-Fulfilling Credit Market Freezes,” Review of Financial Studies 24(11),  3519-3555.

Diamond, Douglas W. and Philip H. Dybvig (1983). "Bank Runs, Deposit Insurance, and Liquidity," Journal of Political Economy 91(3), 401-419.

Freixas, X and Rochet, Jean-Charles.  Microeconomics of Banking, MIT Press, 2008.

Gertler, Mark and Kiyotaki, Nobuhiro (2012). ``Banking, liquidity and bank runs in an infinite horizon economy.”

Goldstein, Itay and Ady Pauzner (2005). "Demand-Deposit Contracts and the Probability of Bank Runs," The Journal of Finance 60(3), 1293-1327.

Goldstein, Itay, Emre Ozdenoren and Kathy Yuan (2011). "Learning and Complementarities in Speculative Attacks," The Review of Economic Studies 78(1), 263-292.

Kindleberger, Charles and Robert Aliber.  Manias, Panics, and Crashes, Palgrave Macmillan, 2011.

Kiyotaki, N and Moore John (1997). ``Credit Cycles,”  Journal of Political Economy 105, 211-248.

 

Kiyotaki, Nobuhiro and Randall Wright (1989). ``On money as a medium of exchange,” Journal of Political Economy 97(4), 927-954.

 

Mishkin, Frederic S., Economics of Money, Banking and Financial Markets, Pearson, 2010.                                                 

Morris Stephen and Shin Hyun Song (1998).``Unique Equilibrium in a Model of Self-Fulfilling Attacks ,” American Economic Review 88, 587-597.

Morris Stephen and Shin Hyun Song (2004). ``Coordination Risk and the Price of Debt, European Economic Review 48, 133-153.

Reinhart Carmen and Kenneth Rogoff.  This Time Is Different: Eight Centuries of Financial Folly, PUP, 2009.

Stiglitz Joseph and A. Weiss (1981). ``Credit rationing in markets with imperfect information,” American Economic Review 71, 393-410.



The information on this page is indicative of the module that is currently on offer. The University is constantly exploring ways to enhance and improve its degree programmes and therefore reserves the right to make variations to the content and method of delivery of modules, and to discontinue modules, if such action is reasonably considered to be necessary by the University. Where appropriate, the University will notify and consult with affected students in advance about any changes that are required in line with the University's policy on the Approval of Modifications to Existing Taught Programmes of Study.