MONETARY ECONOMICS
ECO4MNE
Not currently offered
Credit points: 15
Subject outline
In this subject, students will examine the effects of monetary variables on the macroeconomy and develop an understanding of the theoretical basis for the conduct of monetary policy, at an advanced undergraduate level. Topics in this unit include the determinants of money supply, theories of the demand for money and the transmission mechanism of monetary policy. The conduct and design of optimal monetary policies in closed and open economies will also be discussed together with the problem of time inconsistency in the implementation of monetary policy and the associated "rules versus discretion" debate.
School: La Trobe Business School
Credit points: 15
Subject Co-ordinator: Darren Henry
Available to Study Abroad Students: Yes
Subject year level: Year Level 4 - UG/Hons/1st Yr PG
Exchange Students: Yes
Subject particulars
Subject rules
Prerequisites: ECO3EGS OR ECO3MAA
Co-requisites: N/A
Incompatible subjects: N/A
Equivalent subjects: N/A
Special conditions: N/A
Learning resources
Readings
| Resource Type | Title | Resource Requirement | Author and Year | Publisher |
|---|---|---|---|---|
| Readings | The economics of money, banking and financial markets. | Prescribed | Mishkin, F. | PEARSON EDDISON WESLEY, 2013 |
Graduate capabilities & intended learning outcomes
01. 1. Write concise explanations of the theories relevant to monetary economics, including the use of mathematical expressions where appropriate; use TÂ]accounts and mathematical expressions/ derivations to explain the money supply process.
- Activities:
- TBE
02. Describe, discuss and critically evaluate, in writing, the conduct of monetary policy (including goal setting, the use of tools, strategies and tactics) and the policy transmission mechanisms using graphical and mathematical techniques, where appropriate.
- Activities:
- TBE
03. Identify and apply appropriate models/ concepts to analyse issues, assess policy choices and solve computational problems in monetary economics using mathematical and graphical techniques.
- Activities:
- TBE
04. Analyse the possible causes and dynamics of financial crises; discuss how the behaviour of financial institutions in balancing profit maximisation and risk mitigation/management can affect the stability of financial as well as the real sectors.
- Activities:
- TBE
05. Write concise explanations of how the concept of asymmetric information shapes the structure of financial systems and creates the need for financial regulation and the provision of government safety nets.
- Activities:
- TBE