Module Catalogues, Xi'an Jiaotong-Liverpool University   
Module Code: ECO305
Module Title: Monetary Economics
Module Level: Level 3
Module Credits: 5.00
Academic Year: 2017/18
Semester: SEM1
Originating Department: International Business School
Pre-requisites: N/A
This is an advanced-level course on the theories of money and central banking that aims to provide tools and techniques necessary to understand current issues in monetary policy analysis. In particular, the main objectives of the course are to analyse macroeconomic behaviour and the scope for stabilization policies under different assumptions about
(i) the way the public forms expectations,

(ii) price flexibility, and

(iii) information.
Learning outcomes 
Learning outcomes

Students completing the module successfully should:

A Have a working knowledge of key macroeconomic models and understand the role of money in modern economies

B Understand the Rational Expectations Hypothesis (REH) and policy neutrality

C Have knowledge of the New Keynesian framework and its micro-foundation

D Understand the transmission mechanisms of monetary policy

E Understand the conduct of optimal monetary policy and the issues of Central Bank independence
Method of teaching and learning 
The module will be delivered by a combination of lectures and tutorials. Lectures are designed to introduce students to the basic tools and concepts of monetary economics, and to discuss key research papers related to central issues in monetary economics. Tutorials are delivered to supplement the lectures, discuss selected topics in detail, and help prepare students to conduct their own research on the assigned essay.
• Theory of money; the classical heritage of monetary economics

• Keynesian theory of money, the IS-LM analysis, and the Phillips curve

• The financial market structure and the determination of the interest rate and the term structure

• Asymmetric information and financial intermediaries

• Rational expectations, the Lucas critique, and the New Classical Economics

• The Lucas Island model and the theory of policy ineffectiveness

• The New Keynesian approach to monetary economics

• Central bank and the money supply process

• Conventional tools and transmission of monetary policy

• Unconventional tools and transmission of monetary policy

• Rules vs. discretion; the time inconsistency of optimal plans

• Central bank credibility and the design of monetary policy

Delivery Hours  
Lectures Seminars Tutorials Lab/Prcaticals Fieldwork / Placement Other(Private study) Total
Hours/Semester 26     12      112  150 


Sequence Method % of Final Mark
1 Individual Coursework 20.00
2 Group Projects 10.00
3 Final Exam 70.00

Module Catalogue generated from SITS CUT-OFF: 10/22/2017 9:29:17 PM