Money and Banking

Focusing on the financial system and monetary policy, this course looks at key issues in the theory and practice of financial markets, banking, monetary policy and importantly their interaction and how this impacts the real world. The course will relate this to recent economic events which have reverberated worldwide. It is particularly suitable for students wishing to enter careers in financial markets or further study in this area.

The Money and Banking course will look at some key issues in the theory and practice of financial markets, monetary policy and banking and how their interactions affect the real world.

The financial system has undergone many changes since the credit crunch and the Central Banks have had the unenviable task of stimulating the economy, encouraging lending, managing inflation and exchange rates. This course will focus on the financial system and monetary policy in countries around the world and present an opportunity to discuss the financial institutions and monetary policies of different nations, evaluating their relative success in recovering from the financial crisis.

Course Outline #

The focus of the course will be the theory and practice of monetary policy institutions. Within this, the interaction between the financial system (in terms of its institutions and instruments) and the macroeconomy will be examined and there will be a strong practical and policy related element to the course. The course will present an opportunity to discuss the financial institutions and monetary policies of different nations and evaluate their relative success in recovering from the financial crisis. A broad range of topics will be analysed, including how bank runs develop and a discussion of the financial crises in the US and the Eurozone and their different experiences. The course will also introduce the students to some of the state of the art methods applied in modern macroeconomics such as the new Keynesian models. The following list includes the topics that will be covered:

• Money supply and the role of the banking sector
• Interest rates and rates of return
• The stock market and financial market efficiency
• Monetary policy and monetary rules
• New Keynesian macroeconomic models
• Financial crises and regulation
• The 2008’s financial crisis and monetary policy responses

Course Aims #

This course aims to draw on recent financial events from across the world and provide students with a detailed understanding of the economic theory behind the way in which monetary policy can be designed and implemented. By focussing on the interactions between monetary policy, banking and financial markets, this course will give students the tools they need to understand and evaluate these links and apply their findings to real world applications in a variety of countries. Students taking this course will gain a greater awareness of the key elements of the financial system and the roles played by different financial assets. The course aims to give students greater awareness of the monetary transmission mechanism and how we can use modern empirical methods to understand it.

There are important economic lessons to be learnt from the financial crisis and this course will aim to relate relevant economic theory and applications to recent events which have reverberated worldwide. With the aim of developing students’ knowledge and understanding of the complex interactions between monetary policy, financial markets, banks and the economic situation, this course will be ideal for anyone looking to further their knowledge in monetary and financial economics, perhaps with an aim of pursuing a career in this field or undertaking postgraduate study. It will therefore aim to provide students with a rare opportunity to combine academic theory with their interest in a future career in such a direct manner.

Learning Outcomes By the end of this module, students should be able to:

• Understand the main elements of the financial system.
• Apply both micro and macro theory to real-world situations in the areas of money and banking.
• Outline and give a detailed justification of the main goals of monetary policy.
• Assess the relative merits of different countries’ monetary policy institutions.
• Critically discuss and debate a range of current monetary issues.
• Express their views about pertinent monetary and fiscal issues and evaluate the effectiveness of such policies.
• Present clearly and methodically in their own words, also using equations and diagrams.

Course Structure #

For this course, there will be 4 hours of teaching on most weekdays, comprised of lectures and small group teaching. The structure will be:

3 hours of lectures. A 1 hour seminar in small groups. Students will also be given time each day for independent study. Towards the end of the third week, students will also be provided with time for revision.

Due to the intensive nature of the Warwick Summer School, students are expected to attend all timetabled teaching activity, to engage with the teaching material and to spend an average of 2-3 hours per day in self-guided study.

Students registered for Warwick Summer School must attain a minimum of 75% authorised attendance of the timetabled teaching activity. If students fall short of this threshold, they will not be awarded a certificate of completion and they will not be able to sit the exam/submit final assessment.

Authorised attendance includes any sickness absence during the course of the programme that has been properly notified and recorded. An attendance register will be taken at the beginning of teaching session so students need to ensure they arrive on time in order to be marked as attended.

Course Assessment The module will be assessed via a 2-hour examination. It should be noted that the exam is not compulsory. Everyone who completes the course – whether or not they sit the exam - will receive a certificate of attendance.

Students who choose to sit the final exam will receive a transcript of results. The transcript of results will state the name of the student, the course studied, the exam mark and the grade. Transcripts are automatically sent to students via email by the middle of September.  You should keep this safe in case you need it for credit transfer approval or for future reference. If you would like us to email a copy of your transcript directly to someone at your University who deals with credit transfer please let us know.

The Summer School does not offer re-takes of examinations, whatever your result in the original examination.

Entry Requirements #

This course is open to students who are studying or have previously studied Economics at University level. You should attach your most recent transcript or provide a screenshot of your modules from your student portal as evidence when you apply. Students should also meet our standard entry requirements and must be aged 18 or over by the time the Summer School commences and have a good understanding of the English language.

Alumni #

“I rate the course very highly, in terms of academic rigour, quality of teaching and of course, it was extremely well organised. I would definitely recommend it.”

Caroline Wayman (United Kingdom)

Lecturers #

• Fatih Kansoy - Module Leader
• Professor Vicky Pryce - Module Lecturer
• Arthur Galichère - Module Lecturer
• Andrea Guerrieri D’Amati - Graduate Teaching Assistant