Models and Methods of International Macroeconomics

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O.S. Mariev, A.A. Pushkarev
Models and Methods of
International Macroeconomics
Yekaterinburg,
2019

2. Pushkarev Andrey Alexandrovich

a.a.pushkarev@urfu.ru
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3. Contents of the course

Intro Objectives, Project and Milestones
Lecture 1 Basic concepts of exchange rate
Lecture 2 Interest rate parities
Lecture 3 Purchase power parity
Lecture 4 Efficiency of financial markets and its econometric
testing
Lecture 5 Econometric testing of interest rates parity and PPP
Lecture 6 Basic demand-supply model for currency markets
Lecture 7 Monetary model of the exchange rate with flexible
prices
Lecture 8 Dornbush model (Overshooting model)
Lecture 9 Mundell-Fleming model IS-LM-BP model
Project work
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4. Course Objectives

• Provide information on how exchange rate is
formed
• Explore relations of the exchange rate an
other macroeconomic indicators
• Cover how these relations can be empirically
observed and tested
• Cover implications on macroeconomic policy
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5. The Course Evaluation Milestones

• Lectures
• Seminars – Problem solving
• Group Project:
– Analysis of the scientific paper
– Peer review
– Presentation of the analysis
– End of the semester test
• Final exam
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6. The Project. Paper analysis

• 15-20 pages, may be done in the groups of two or
• Topics:
– PPP
– Exchange rate dynamics
– Bank crises
– Interest rate parities
– Currency markets
• Published scientific paper not older than two years
• Paper should contain economic model (Only econometrics is not ideal, but
may be sufficient in some cases)
• Analysis should propose some kind of modification for the described
model
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7. The Project. Peer review

5-15 pages
Highlight strengths and weakness
Outline the marking system
If there are mistakes – correct them
If there is no modification in the reviewed
analysis – propose it
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8.

The Project. Presentation
• 15 minutes + 5 minutes for questions
• Present key points of the article and your
analysis
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9. Expected Results

• You will know what is:
– FOREX
– RER
– PPP
– Interest rates
• You will be able to:
– analyse exchange rate dynamics
– Forecast exchange rate dynamics
– propose implications of the exchange rate polices on the
macroeconomic indicators
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