1. Topics in International Economics Seminar Universidad de Navarra April 3, 2008

2. Agenda Today Topics in International Economics: A Bird’s Eye View What are you required to do Groups

3. Topics in International Economics Monetary Policy Strategies for Open Economies

4. Topics in International Economics Monetary Policy Strategies for Open Economies –Monetary Policy Key to Fine-Tune any Economy

5. Topics in International Economics Monetary Policy Strategies for Open Economies –Monetary Policy Key to Fine-Tune any Economy –Monetary Policy in an Open Economy brings up additional and important dimensions with respect to Closed Economies

6. Topics in International Economics Monetary Policy Strategies for Open Economies –Monetary Policy Key to Fine-Tune any Economy –Monetary Policy in an Open Economy brings up additional and important dimensions with respect to Closed Economies –Exchange Rate Key variable in these economies

7. Topics in International Economics Monetary Policy Strategies for Open Economies –Monetary Policy Key to Fine-Tune any Economy –Monetary Policy in an Open Economy brings up additional and important dimensions with respect to Closed Economies –Exchange Rate Key variable in these economies –Why so many small and emerging open economies fix their exchange rate?

8. Topics in International Economics Monetary Policy Strategies for Open Economies –Monetary Policy Key to Fine-Tune any Economy –Monetary Policy in an Open Economy brings up additional and important dimensions with respect to Closed Economies –Exchange Rate Key variable in these economies –Why so many small and emerging open economies fix their exchange rate? –Is inflation targeting appropriate for these economies?

9. Topics in International Economics The future of the European Monetary Union (EMU)

10. Topics in International Economics The future of the European Monetary Union (EMU) –EMU: Amazing story… but real

11. Topics in International Economics The future of the European Monetary Union (EMU) –EMU: Amazing story… but real –Monetary Policy in the EMU context not an easy task!

12. Topics in International Economics The future of the European Monetary Union (EMU) –EMU: Amazing story… but real –Monetary Policy in the EMU context not an easy task! –Will the business cycle be ever synchronized among different countries such as Finland and Spain?

13. Topics in International Economics The future of the European Monetary Union (EMU) –EMU: Amazing story… but real –Monetary Policy in the EMU context not an easy task! –Will the business cycle be ever synchronized among different countries such as Finland and Spain? –Will countries be tempted to leave the euro?

14. Topics in International Economics The future of the European Monetary Union (EMU) –EMU: Amazing story… but real –Monetary Policy in the EMU context not an easy task! –Will the business cycle be ever synchronized among different countries such as Finland and Spain? –Will countries be tempted to leave the euro? –Will the euro become more important than the dollar in the foreign exchange markets?

15. Topics in International Economics Emerging Market Economy Dynamics

16. Topics in International Economics Emerging Market Economy Dynamics –A fact: Up to now, most of the world economic growth has been concentrated in three areas: Western Europe, North America and Japan (less than 20% of the world population)

17. Topics in International Economics Emerging Market Economy Dynamics –A fact: Up to now, most of the world economic growth has been concentrated in three areas: Western Europe, North America and Japan (less than 25% of the world population) –India and China’s growth: How will affect the distribution of wealth across countries and across individuals?

18. Topics in International Economics Emerging Market Economy Dynamics –A fact: Up to now, most of the world economic growth has been concentrated in three areas: Western Europe, North America and Japan (less than 25% of the world population) –India and China’s growth: How will affect the distribution of wealth across countries and across individuals? –Is their growth sustainable? Will they ever converge to standard free-market economies?

19. Topics in International Economics Emerging Market Economy Dynamics –A fact: Up to now, most of the world economic growth has been concentrated in three areas: Western Europe, North America and Japan (less than 25% of the world population) –India and China’s growth: How will affect the distribution of wealth across countries and across individuals? –Is their growth sustainable? Will they ever converge to standard free-market economies? –What are their challenges ahead?

20. Topics in International Economics Capital Flows and Economic Growth

21. Topics in International Economics Capital Flows and Economic Growth –Big question: Are capital flows good for the receiving country? And for the investor country?

22. Topics in International Economics Capital Flows and Economic Growth –Big question: Are capital flows good for the receiving country? And for the investor country? –What kinds of flows are good? Short-run v/s Long-run. Capital flows/ Portfolio Flows v/s FDI

23. Topics in International Economics Capital Flows and Economic Growth –Big question: Are capital flows good for the receiving country? And for the investor country? –What kinds of flows are good? Short-run v/s Long-run capital flows/ Portfolio Flows v/s FDI –How should a developing country open their capital account? What should the timing be?

24. Topics in International Economics Capital Flows and Economic Growth –Big question: Are capital flows good for the receiving country? And for the investor country? –What kinds of flows are good? Short-run v/s Long-run capital flows/ Portfolio Flows v/s FDI –How should a developing country open their capital account? What should the timing be? –Capital controls: Theory and evidence

25. Topics in International Economics Capital Flows and Economic Growth –Big question: Are capital flows good for the receiving country? And for the investor country? –What kinds of flows are good? Short-run v/s Long-run capital flows/ Portfolio Flows v/s FDI –How should a developing country open their capital account? What should the timing be? –Capital controls: Theory and evidence –Positive Spillover Effects of Capital Flows for the receiving country

26. Topics in International Economics Global Imbalances

27. Topics in International Economics Global Imbalances –Are Large and Lasting Current Account Deficits Sustainable?

28. Topics in International Economics Global Imbalances –Are Large and Lasting Current Account Deficits Sustainable? –The US Current Account Deficit: Causes and Consequences

29. Topics in International Economics Global Imbalances –Are Large and Lasting Current Account Deficits Sustainable? –The US Current Account Deficit: Causes and Consequences –The adjustment through the exchange rate. Was the depreciation of the dollar expected?

30. Topics in International Economics Global Imbalances –Are Large and Lasting Current Account Deficits Sustainable? –The US Current Account Deficit: Causes and Consequences –The adjustment through the exchange rate. Was the depreciation of the dollar expected? –Do Current Account Deficits lead to recessions? The Case of Spain

31. Topics in International Economics Global Imbalances –Are Large and Lasting Current Account Deficits Sustainable? –The US Current Account Deficit: Causes and Consequences –The adjustment through the exchange rate. Was the depreciation of the dollar expected? –Do Current Account Deficits lead to recessions? The Case of Spain –Surplus in Current Accounts and International Reserve Accummulation

32. Topics in International Economics Balance of Payments Crises

33. Topics in International Economics Balance of Payments Crises –Fixed exchange rates and Speculative Attacks… against a currency

34. Topics in International Economics Balance of Payments Crises –Fixed exchange rates and Speculative Attacks… against a currency –Fiscal policy and Speculative Attacks

35. Topics in International Economics Balance of Payments Crises –Fixed exchange rates and Speculative Attacks… against a currency –Fiscal policy and Speculative Attacks –Opening the Capital Account and Speculative Attacks

36. Topics in International Economics Balance of Payments Crises –Fixed exchange rates and Speculative Attacks… against a currency –Fiscal policy and Speculative Attacks –Opening the Capital Account and Speculative Attacks –Banks’ Balance Sheets and Speculative Attacks

37. Topics in International Economics Balance of Payments Crises –Fixed exchange rates and Speculative Attacks… against a currency –Fiscal policy and Speculative Attacks –Opening the Capital Account and Speculative Attacks –Banks’ Balance Sheets and Speculative Attacks –Predicting Balance of Payments Crises

38. Topics in International Economics Recent Banking Crises

39. Topics in International Economics Recent Banking Crises –Banking Regulation

40. Topics in International Economics Recent Banking Crises –Banking Regulation –The sub-prime crises, so different from others?

41. Topics in International Economics Recent Banking Crises –Banking Regulation –The sub-prime crises, so different from others? –Anatomy of a standard banking crises

42. Topics in International Economics Recent Banking Crises –Banking Regulation –The sub-prime crises, so different from others? –Anatomy of a standard banking crises –Relation Between Banking Crises and Balance of Payments Crises

43. Topics in International Economics International Trade Issues

44. Topics in International Economics International Trade Issues –Bilateralism v/s Multilateralism

45. Topics in International Economics International Trade Issues –Bilateralism v/s Multilateralism –Trade Areas: Building Blocks or Stumbling Blocks?

46. Topics in International Economics International Trade Issues –Bilateralism v/s Multilateralism –Trade Areas: Building Blocks or Stumbling Blocks? –Tariff Reduction Schemes

47. Topics in International Economics International Trade Issues –Bilateralism v/s Multilateralism –Trade Areas: Building Blocks or Stumbling Blocks? –Tariff Reduction Schemes –Trade and Poor Countries

48. What do you have to do?

49. Nothing! What do you have to do?

50. Nothing! Just kidding… What do you have to do?

51. Prepare a Power-Point Presentation of one of the papers suggested in the syllabus What do you have to do?

52. Prepare a Power-Point Presentation of one of the papers suggested in the syllabus A 30 mins (aprox.) presentation What do you have to do?

53. Prepare One Power-Point Presentation of one of the papers suggested in the syllabus Do A 30 mins (aprox.) presentation It will be discussed here in front of Faculty and students What do you have to do?

54. Prepare a Power-Point Presentation of one of the papers suggested in the syllabus A 30-35 mins (aprox.) presentation It will be discussed here in front of Faculty and students You will be working in groups What do you have to do?

55. How should the presentation be? What do you have to do?

56. How should the presentation be? –Informed Really learn the topic and paper you are presenting. You can look up other papers, ask us… ask questions What do you have to do?

57. How should the presentation be? –Informed Really learn the topic and paper you are presenting. You can look up other papers, ask us… ask questions –Clear! Talk loud Do not write many things per power-point overhead Graphs, we love graphs What do you have to do?

58. How should the presentation be? –Informed Really learn the topic and paper you are presenting. You can look up other papers, ask us… ask questions –Clear! Talk loud Do not write many things per power-point overhead Graphs, we love graphs –Structure Motivation: Why is this topic important? Summary of the paper: Main Points, Message Strong Points of the paper Your own critique of the paper What do you have to do?

59. You have to attend every session What do you have to do?

60. You have to attend every session You are encouraged to actively participate in the discussions What do you have to do?

61. Margarita Pérez López Laura Riba Marta Goñi Mercedes Robles Galder del Campo Josu Rodríguez Sedano Rubén Romera Mercedes Erdozáin Rita Ruiz de Alda Jaime Piñeiro Groups

62. Bernard Paternina Meilssa Padilla Juana Galíndez Fermín Alarcón Rafael Mata Julián Bermúdez Mayte Serraclara Javier Olábarri Raúl Bajo Groups

63. Claudia González Javier López Julián Bermúdez Fahey Sheble Christine Cramblit Claudia González Javier López Carlos Eugui Bo-Yun Liu Groups