COURSE INFORMATION Course Title: MONETARY THEORY AND POLICY II

Code	Course Type	Regular Semester	Theory	Practice	Lab	Credits	ECTS
ECO 332	B	6	3	0	0	3	6

Academic staff member responsible for the design of the course syllabus (name, surname, academic title/scientific degree, email address and signature)	Dr. Chrysanthi Balomenou cbalomenou@epoka.edu.al
Main Course Lecturer (name, surname, academic title/scientific degree, email address and signature) and Office Hours:	Dr. Chrysanthi Balomenou cbalomenou@epoka.edu.al , Friday 11:00-13:00
Second Course Lecturer(s) (name, surname, academic title/scientific degree, email address and signature) and Office Hours:	NA
Language:	English
Compulsory/Elective:	Compulsory
Study program: (the study for which this course is offered)	Bachelor in Economics (3 years)
Classroom and Meeting Time:	E211 at 12:45-15:30
Teaching Assistant(s) and Office Hours:	NA
Code of Ethics:	Code of Ethics of EPOKA University Regulation of EPOKA University "On Student Discipline"
Attendance Requirement:	A minimum rate of 75% is required for the student to enter the final examination.
Course Description:	Monetary Theory and Policy II: Determining, implementing, and evaluating monetary and fiscal policy; effect on the economy, monetary targets and indicators; role of interest rates in understanding monetary policy, the effects of monetary policy on different sectors; role of fiscal policy in the economy.
Course Objectives:	The aim of this Thematic Subject is mainly to provide the students a clear understanding of the following concepts and mechanisms: -The economic significance, the definitions and the types of money, the quantity and the value of money as well as the determinants which affect the demand and the supply of money. - The operation of the financial system both within a closed as well as in open economy.

BASIC CONCEPTS OF THE COURSE

1	Money (Functions, qualities, theoretical and empirical definitions)
2	Money supply
3	Money Demand and relevant theories
4	IS-LM curve and Taylor Rule
5	International Economic Policy and Foreign Exchange Markets
6	Optimum currency areas
7	Regulatory framework of international banking
8	Markets in Financial Instruments Directive
9	Money Laundering
10	Basel Capital Accords

COURSE OUTLINE

Week	Topics
1	Introduction of the syllabus, academic writing rules (a refreshment of the already taught in the first-year key elements of the academic writing well-adjusted to the needs of the comparative banking course) and discussion on the indicative project topics. More specifically we are going to analyze the key parts of the syllabus and afterwards we will be based on the way that we are going to proceed with the elaboration of the team working projects. In order the students to be facilitated more, during this introductory lecture it will be presented some indicative topics or in a broader way reliable scientific areas of the examining field, which could be chosen purely by the students or they can be based on them in order to form their own topic.
2	Money (Functions, qualities, theoretical and empirical definitions) – In this chapter the concept of money will be explained together with some reasons why people do need and save money. Then the qualities of money will be pinpointed. Afterwards, three types of money classification will be mentioned (M1, M2 and M3) (pg. 414-424).
3	Money supply – In this chapter the money supply will be thoroughly explain by starting to mention firstly the primary and secondary money and central bank balance sheets. Additionally, the role of money in monetary policy, how money is created and how it is supplied will be elaborated (pg. 424-444)
4	IS-LM curve and Taylor Rule (1st part) – In this lecture the IS-LM model in a closed economy will be presented firstly together with the implementation in the monetary policy and economy. Moreover, the liquidity trap will be explained presenting also the inflation and its effects. In addition, the reasons that lie behind the creation of inflation as well as some fiscal policies will be discussed (pg. 434-450).
5	IS-LM curve and Taylor Rule (2nd part) – This chapter begins by highlighting some monetary and targeting policies. Moreover, the Taylor Rule will be presented with each of its versions. Lastly, some monetary policies for the Eurosystem will be mentioned (pg. 451-461).
6	Revision. We are recapping all the already taught subjects, by pinpointing the highlights of them concentrating on those that are needing, due to their nature, more attention in terms of critical analysis and combination of different reliable topics.
7	Midterm Exam
8	Money demand (1st part) – In this lecture the main objectives are as follows: to describe Friedman’s modern quantity theory of money, to describe the classical quantity theory, to describe Keynes’s liquidity preference theory and its improvements and to contrast the modern quantity theory with the liquidity preference theory (pg. 420-433).
9	Money demand (2nd part) - In this lecture the main objectives are as follows: to describe Friedman’s modern quantity theory of money, to describe the classical quantity theory, to describe Keynes’s liquidity preference theory and its improvements and to contrast the modern quantity theory with the liquidity preference theory (pg. 420-433).
10	International Economic Policy and Foreign Exchange Markets (1st part) - In this section firstly an explanation will be made for exchange rates and cross rates accordingly. Later, the balance of payments together with its components will be pinpointed accordingly (pg. 534-547).
11	International Economic Policy and Foreign Exchange Markets (2nd part) - In this section firstly an explanation will be made for exchange rates and cross rates accordingly. Later, the balance of payments together with its components will be pinpointed accordingly (pg. 534-547).
12	Optimum Currency Areas - In this lecture the rates will be explained (fixed and floating) together with key features of each of them. Then, the PPP (Purchasing Power Parity) will be analyzed in detail. Also, some international policy guidelines will be presented (pg. 450-469; pg. 681-720). Additionally, the monetary policy in the Euro system will be highlighted including target policy and target inflation as well. Afterwards, the open market operations in the ECB will be discussed (pg. 340-353).
13	Revision. We are summing up all the already taught subjects, by pinpointing the highlights of them concentrating on those that are needing, due to their nature, more attention in terms of critical analysis and combination of different reliable topics.
14	Final Exam

Prerequisite(s):
Textbook(s):	Principles of money, banking and financial systems, Edward T. Merkel (2009)-International Economics: Theory and Policy, 11th Edition, Paul R. Krugman,Maurice Obstfeld, Marc J. Melitz, 2018 -Finance, Banking and Money, V.2.0, 2012
Additional Literature:	The principles of banking, Moorad Choudhry (2012)-Principles of banking law, 3rd edition, Ross Cranston, Emilios Avgouleas, Kristin van Zwieten, Christopher Hare, Theodor van Sante and Teaching Notes and reliable Power Points prepared by the Lecturer of the Course Dr. Chrysanthi Balomenou
Laboratory Work:	NA
Computer Usage:	NA
Others:	No

COURSE LEARNING OUTCOMES

1	Explain the definition and role of money in an economy and describe in detail the different types of money.
2	Review and analyze the main factors and theories determining and governing demand for money and money supply in a modern economy.
3	Assess and critically compare local and international money and capital markets as well as intermediation in these markets.
4	Articulate and discuss the way in which the monetary system and financial institutions are controlled and supervised.
5	Analyze the structural characteristics of the financial system, as well as the instruments of monetary policy.
6	Discuss the merits of the alternative exchange rate systems and how they affect the implementation and effectiveness of monetary policy.
7	Illustrate the fundamental role and the criterion in order for a currency area to be characterized as an optimum one.
8	Present the work of Basel Committee on Banking Supervision (Basel I, II, III).
9	Identify the importance of the balance of payments accounts and how they interfere with the domestic monetary processes.
10	Discuss the merits of the alternative exchange rate systems and how they affect the implementation and effectiveness of monetary policy. Analyze the characteristics case of optimum currency areas.

COURSE CONTRIBUTION TO... PROGRAM COMPETENCIES (Blank : no contribution, 1: least contribution ... 5: highest contribution)

No	Program Competencies	Cont.
Bachelor in Economics (3 years) Program
1	Students define the fundamental problems of economics	5
2	Students describe key economic theories	5
3	Students critically discuss current developments in economics	5
4	Students appropriately use software for data analysis	5
5	Students critically contextualize the selection of an economic problem for research within scholarly literature and theory on the topic	5
6	Students apply appropriate analytical methods to address economic problems	5
7	Students use effective communication skills in a variety of academic and professional contexts	5
8	Students effectively contribute to group work	5
9	Students conduct independent research under academic supervision	5
10	Students uphold ethical values in data collection, interpretation, and dissemination	5
11	Students critically engage with interdisciplinary innovations in social sciences	5
12	Student explain how their research has a broader social benefit	5

COURSE EVALUATION METHOD

Method	Quantity	Percentage
Midterm Exam(s)	1	40
Final Exam	1	50
Attendance		5
Other	1	5
	Total Percent:	100%

ECTS (ALLOCATED BASED ON STUDENT WORKLOAD)

Activities	Quantity	Duration(Hours)	Total Workload(Hours)
Course Duration (Including the exam week: 16x Total course hours)	16	3	48
Hours for off-the-classroom study (Pre-study, practice)	16	3	48
Mid-terms	1	16	16
Assignments	1	12	12
Final examination	1	16	16
Other	1	10	10
Total Work Load:			150
Total Work Load/25(h):			6
ECTS Credit of the Course:			6

CONCLUDING REMARKS BY THE COURSE LECTURER

All the expected course learning outcomes were met successfully. The course contributed to the enrichment of students' knowledge since the examined topics had combined the theoretical grounds of the taught scientific field with the needs of the relevant industry.