Managers, especially those working in the finance sector, are bombarded by macroeconomics and financial news from around the world. Since almost all decisions in this increasingly interconnected world depend on both macro and foreign developments, it is important for managers to understand how to integrate this information into a coherent framework.
In the Understanding Global Macroeconomics course the participants will be introduced to various aspects of macroeconomics and will get acquainted with the main concepts and policy debates. In the two days, we will look into theoretical foundations of the macro economy: aggregate demand, aggregate supply, fiscal policy, as well as monetary policy. We will equally examine the international economy, exchange rates, trade policy and optimal currency areas. After each theoretical introduction we will look into practical applications: from Brexit to climate change policy, from inequality to central bank independence, and from the Big Mac Index to the current wave of protectionism. The focus will be about 25% on theory and 75% on real-world applications.
How you will benefit
- Be able to interpret high level articles about economics, the main national and international policy discussions
- Construct logical relationships between all major macroeconomic variables and entities: technology, productivity, economic growth, demographics, interest rates, income distribution, exchange rates, domestic politics, international institutions
- Engage in topical policy debates
- Tie business decisions to macroeconomic policy debates
|Day 1||09:00 – 17:30|
|Day 2||09:00 – 17:30|
Aggregate Supply and Demand
IS-LM Model: Applying Shocks to the Economy
Solow Growth Model: the Role of Demographics and Technology on Economic Growth
- Robert Gordon: why is growth structurally slowing down in the West?
- From industrial revolution to secular stagnation
- Sources of economic slowdown and potential remedies
- Implications for monetary policy and fiscal policy
- Brief history of inequality
- Inequality measures: absolute deprivation to Gini coefficient (or Gini index)
- Case studies: from Piketty to Branko Milanovic and the rise of populism
- Central bank independence
- The role of central banks in the recent financial crisis – in their buildup as well as in the resolution
- Commodity prices and their role in the macro economy: from demand shock to supply shock and the impact on monetary policy
- Monetary policy in a low inflation environment – the liquidity trap
- The politicizing of monetary policy
Adding the Rest of the World: Capital Flows, Exchange Rates and the Current Account
- Current account crises and their resolution
- Purchasing power parities: uses and limitations, Big Mac Index
The Open Economy: Mundell Fleming Model (MFM)
Optimal Currency Areas: Mundell
- Is the European Monetary Union an optimal currency area?
- Is there still scope for new currency areas + implications for sovereignty?
- Case study: the Eurozone crisis
- The impossible trilemma of globalization, national sovereignty and democratic politics
- Case study: Brexit and US trade policy under Trump
- From international rankings to power politics
- Climate change policy – from measures to international policy coordination
- The role of politics in national and international economics
Understanding Global Macroeconomics is applicable to any business professional, coming from a broad range of disciplines in finance, corporate and strategic planning, advisory work and financial regulatory bodies.