Business School UWA Business School

Unit Outline

Rise of the Global Economy ECON1105

SEM-1, 2012 Campus: Crawley Unit Coordinator: Associate Professor Paul Crompton
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Unit Details
Unit title Unit code Availability Location Rise of the Global Economy ECON1105 SEM-1, 2012 (27/02/2012 - 23/06/2012) Crawley Credit points Mode 6 On-campus

Contact Details
Faculty School School website Unit coordinator Unit coordinator email Unit coordinator telephone number Consultation hours Lecturers

Business School UWA Business School http://www.business.uwa.edu.au/

Associate Professor Paul Crompton paul.crompton@uwa.edu.au 08 6488 2929

By appointment
Name Position Email Telephone Number A/Professor Paul Crompton Associate Professor paul.crompton@uwa.edu.au 64882929 Candyce Ross

Tutors Unit contact hours For standard teaching period: lectures: 2 hrs per week; tutorials: 1 hr per week For Lecture times please check: http://www.timetable.uwa.edu.au For Tutorial times please check: http://www.olcr.uwa.edu.au We strongly advise students to regularly access their student email accounts. Important information regarding the unit is often communicated by email and will not be automatically forwarded to private email addresses. Online handbook Unit website

http://units.handbooks.uwa.edu.au/units/ECON/ECON1105 http://www.lms.uwa.edu.au

Unit Rules
Incompatibility

ECON2105 Rise of the Global Economy

Unit Description
Description
This unit examines the evolution of the financial and economic environment in which modern businesses operate and current global economic and financial issues. This involves an examination of issues such as the development of cross-border financial and economic linkages, the rise of global financial markets and institutions, foreign exchange markets, the Global Financial Crisis, asset markets and prices such as the stock market and housing prices, global imbalances, currency unions and the future of the global economic and financial system.

Introduction
The global integration of economies and financial markets in recent decades has fundamentally changed the way that the global economy functions and the potential problems that such integration can create. Today, the US and UK economies are in recession, debt levels (both government and households) in many countries are at historically high levels, sovereign debt crises are threatening Europe. In Australia, we have come through the global financial crisis well, but we still face risks imposed on us by other parts of the world. The operation of the global economy is complex, however, it is important for anybody entering the field of business to understand how the global economy operates and how problems within the global economy can affect both individuals and businesses within Australia.

Unit content
This unit is a first-year course that uses the tools of macroeconomic and international finance to examine the current state of the global economy. The first section of the course covers the basic economics and finance necessary to help you understand the world of economics and finance as it is today. The remainder of the course focuses on the operation and issues associated with the global economic and financial system. We will study exchange rates, international financial flows, global financial markets, the global financial crisis, currency crises, asset bubbles, optimal currency areas, and financial institutions around the world. Equally importantly, we will consider whether a large global financial crisis is looming in the coming years.

Unit goals
The goal of this unit is to develop a solid understanding of global economic and financial framework, and appreciate the issues that face the global economy in the coming decade.

Educational principles and graduate attributes

In this unit, you will be encouraged and facilitated to develop the ability and desire to: master the subject matter, concepts and techniques of their chosen discipline(s) at internationally-recognized levels and standards; adapt acquired knowledge to new situations; think and reason logically and creatively;

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undertake problem identification, analysis and solution; question accepted wisdom and be open to new ideas and possibilities.

Learning outcomes
# 1 2 3 4 Outcomes Describe the operation of the global economy and global financial markets Demonstrate how global political, financial and economic events affect the Australian economy Read and critically evaluate the financial press as it relates to the global economy Assess how government policies and changing macroeconomic conditions affect the global economy

Unit schedule
Week 1 Lecture Topic Global Economic and Financial Issues (I) Required reading: Money, prices and the Reserve Bank (TB); Debt and deleveraging; Rebalancing growth in Asia; Sustaining a global recovery Economic Fundamentals (II) Required reading: What is gross domestic product?; What is a recession?; What is inflation?; What is monetary policy?; What is fiscal policy? Global Financial Markets (III) Required reading: Financial instruments, financial markets, and financial insts (TB); Bonds, bond prices and the determination of interest rates (TB) Global Financial Markets (III) Required reading: The risk and term structure of interest rates (TB) Exchange Rates (IV) Required reading: Foreign exchange and the international monetary system (TB); Exchange rate regimes; Why real exchange rates? Global Financial Flows (V) Required reading: The balance of payments (TB); Global imbalances: A savings and investment perspective; Do current account deficits matter? Study break The International Monetary System (VI) Required reading: The international monetary system and exchange rate arrangements (TB); The International Monetary Fund: doctor or witch doctor? (TB) Financial Crises (VII) Required reading: Financial crises, panics, and macroeconomic policy (TB) Asset Markets and Rationality (VIII) Required reading: Asset price booms The housing bubble (TB) Housing prices: more room to fall? The Global Financial Crisis (IX) Required reading: The perfect storm; What is securitisation? The Global Financial Crisis (IX) Required reading: Causes of the financial crisis; The global financial crises The Future of the Global Economic System (X) Required reading: TBA Course Review (XI) Required reading: TBA

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Teaching and Learning Responsibilities

Teaching and learning strategies
Success in this unit requires that you understand all of the lecture, tutorial, textbook and reading materials. Lectures and tutorials will cover both the theoretical material covered in the textbooks and readings, as well as practical examples and case studies.

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Teaching and learning evaluation

You may be asked to complete two evaluations during this unit. The Student Perception of Teaching (SPOT) and the Students Unit Reflective Feedback (SURF). The SPOT is optional and is an evaluation of the lecturer and the unit. The SURF is completed online and is a university wide survey and deals only with the unit. You will receive an email from the SURF office inviting you to complete the SURF when it is activated. We encourage you to complete the forms as your feedback is extremely important and can be used to make changes to the unit or lecturing style when appropriate.

Attendance
Participation in class, whether it be listening to a lecture or getting involved in other activities, is an important part of the learning process. It is therefore important that you attend classes. More formally, the University regulations state that to complete a course or unit students shall attend prescribed classes, lectures, seminars and tutorials.

Charter of student rights and responsibilities

The Charter of Student Rights and Responsibilities outlines the fundamental rights and responsibilities of students who undertake their education at UWA (see http://www.aps.uwa.edu.au/home/policies/charter)

Student Guild contact details

Phone: (+61 8) 6488 2295 Facsimile: (+61 8) 6488 1041 Email: enquiries@guild.uwa.edu.au Website: http://www.guild.uwa.edu.au

Assessment
Assessment overview
Supplementary assessment is not available in this unit except in the case of a bachelor's pass degree student who has obtained a mark of 45 to 49 and is currently enrolled in this unit, and it is the only remaining unit that the student must pass in order to complete their course.

The purpose of assessment

There are a number of reasons for having assessable tasks as part of an academic program. The assessable tasks are designed to encourage you to explore and understand the subject more fully. The fact that we grade your work provides you an indication of how much you have achieved. Providing feedback on your work also serves as part of the learning process.

Assessment mechanism
# 1 2 3 Component Tutorial participation Mid semester exam (will cover topics I to IV) Final exam (will cover topics III to X) Note 1: Results may be subject to scaling and standardisation under faculty policy and are not necessarily the sum of the component parts. Note 2: Your assessed work may also be used for quality assurance purposes, such as to assess the level of achievement of learning outcomes as required for accreditation and audit purposes. The findings may be used to inform changes aimed at improving the quality of Business School programs. All material used for such processes will be treated as confidential, and the outcome will not affect your grade for the unit. Weight 10% 30% 60% Due Date Week 7 TBA

Assessment items
Item Title Tutorial mark (10%) Description This mark will be based upon your attendance and participation in discussions in the tutorials. We expect active participation in group discussions by all students. Tutors have been advised to award the entire range of marks between 0/10 and 10/10. Your ability to present your answers and opinions to the tutorial group will also contribute to your final mark. If you are absent without a medical certificate you will be given a mark of zero for that particular tutorial which will reduce your average. If you do not make a contribution to tutorial discussions then you will be awarded a mark of 0/10. In other words, students who do not talk and contribute in tutorials will be throwing away 10% of their final grade for the unit. The exact date, time and venue of the mid semester exam will announced during the semester. The mid semester exam will cover Topics I to IV. Writing time is one hour and ten minutes. The exam will consist of multiple choice and short answer questions. The exam will comprise a total of 30 marks. The final exam will cover Topics III to X. The final exam will be two hours and consist of two sections: Section A: 2 Short Answers (choice of three) 20 marks Section B: 2 Essays (choice of three) 40 marks Total 60 marks

Mid Semester Exam (30%) Final Exam (60%)

Appeals against academic assessment

The University provides the opportunity for students to lodge an appeal against assessment results and/or progress status (refer http://www.secretariat.uwa.edu.au/home/policies/appeals).

Textbooks and Resources

Recommended texts Required Texts:
Title: Rise of the Global Economy UWA Custom Publisher: McGraw-Hill, Australia

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Edition: 2nd Author: Cecchetti/Crompton IBN: 9781121419421

Title: Rise of the Global Economy: Readings Publisher: UWA Author: Associate Professor Paul Crompton

Additional resources and reading

Unit website https://www.lms.uwa.edu.au A course reader is available for purchase through the UWA bookshop.

Other Important Information

This Unit Outline should be read in conjunction with the Business School Unit Outline Supplement available on the Current Students web site http://www.business.uwa.edu.au/students

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