International Business

This course brings together topics in macroeconomics, international economics, and finance to look at central banks which are often dominant players in financial markets and provide a framework for understanding their actions. You will gain an overview of the key issues that confront all central banks. Then you will spend time seeing how the Federal Reserve, the Bank of Japan, and the European Central Bank resolve these issues. We contrast their approaches with those taken by central banks in other industrialized countries and in developing countries. We also study how central banks actions interact with asset markets. There will be two guest speakers who are prominent members of world's central banking community.

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You will develop an understanding of issues in international macroeconomics that are important for managers operating in the global marketplace. The course covers theories of the determination of exchange rates and interest rates, the management of foreign exchange risk, international capital flows, debt and currency crises, international monetary and exchange rate regimes, the roles of the international financial institutions in developing countries, and other characteristics of international financial markets.

Despite the unprecedented rise of emerging markets, the threat of financial and political crises continues to haunt global entrepreneurs. What guidelines does financial theory provide to entrepreneurs investing in emerging markets? How can one value and manage the risks and uncertainties that characterize emerging markets? The course begins by assessing how we should modify traditional financial tools to cope with the particular risks of emerging markets. We discuss pitfalls in some of the common industry prescriptions, and present a unified methodology for evaluating emerging market investments based on theoretical foundations. A central message of the first half of this course is that emerging market risks are often large enough to make most investments seem unviable. This leads us into the second half of the course that stresses the importance of enhancing investment value by managing these risks appropriately.The course uses a number of real world examples from such places as China, South Asia, Africa and Latin America.

Why is the United States the wealthiest country in the world? How can we understand the emergence of China and India in the last two decades? What explains growth disasters of countries such as Venezuela and Sub-Saharan Africa? Why has Brazil not emerged as a growth miracle despite its enormous potential? This course is designed to provide students with an analytical framework to answer these questions. We will develop models that explore the role of financial markets, labor market regulations, corruption, and trade policy in understanding a country's growth experience