Advanced Macroeconomics
AdvancedMacroeconomics
Peking University HSBC Business School 2013Fall
This course is about Macroeconomics and Finance. It introduces many topics in modern financeandmacroeconomics.Wewillespeciallypay attention to the Subprime Mortgage Crisis, European Debt Crisis, Chinese Economic and Financial system, as well as other modern macroeconomics and finance topics. Thefirst part of this course is taught by me and the second part is mainly about presentation. The presentation will be rather demanding and challenging, which will be more specified later during the class.
Contact Information: Chunyang Wang Room: C320
Email: cywang@phbs.pku.edu.cn
Office Hours: Thursday 2:00-4:00PM
Teaching Assistant: Wei Chen
Email: clairechen@sz.pku.edu.cn
Prerequisite:
Mankiw, Gregory “Principle of Macroeconomics” 5thEdition
Assessment:
Presentation(50%): The qualityof presentation will be judgedby various standards, such as the difficulty level ofthe paper, and presentation time (latter presenters will have more experience fromthe class.) There will be a specific guideline on how to present a paper.
Enrollment (10%): You will find your absence or not paying attention in class will leave your presentation very bad. Only the school official notice for absence is recognized.
Class Participation (10%): Class discussion will be strongly encouraged and sometimes will be required. For example, you names willbe called randomly. If you are absent, you will lose both your enrollment score and participation score.
You will automatically fail theclass if you miss three classes.
Final report (20%): The final report will bean extension of any presentation by you or others which you find interesting. It can focus on some specific topic, or some continuation, or some recent news update of the paper.
Teaching Schedule: (I will teach inthe following order. But the exact time will depend on the proceeding of the class.)
Guidelines for Presentation
1. Every presentation should have a Key Sentence,whichshouldappearinoneof the first three slides. Thepurpose is for audience not to be lost, and with this key sentence, they can better understandyour motivation slides and others.
2. Do not try to confuse people to make you appear knowledgeable. If I cannot figure out what you aretalking about,I will randomly callanother student or ask you to pick any student in the classroom to see whether he/she understands or not. Your work should be easily understood by your grandma, just like Poet JuyiBairead poemto old women to check whether they understand the poemor not. So if a professor with a PhD cannot understand what you are saying, your presentation is failing.
3. Do not show too many words in one side. People cannot read so much in such short time, and they cannot concentrate to listen to you when they are reading.
4. Asymmetry. You have already known the materials very well. Presentersoften ignore the fact that for most oftime, the audience has no idea of the topic. So it’s better for you to think in the position of audience when you present.
5. If there is any figure, please first tell the audiencewhat x and y axis indicate, especially the y axis.
6. Respond in a professional way to rude questions. Responding in a rude way does not make yourself win but lose. The audience can judge who
Peking University HSBC Business School 2013Fall
This course is about Macroeconomics and Finance. It introduces many topics in modern financeandmacroeconomics.Wewillespeciallypay attention to the Subprime Mortgage Crisis, European Debt Crisis, Chinese Economic and Financial system, as well as other modern macroeconomics and finance topics. Thefirst part of this course is taught by me and the second part is mainly about presentation. The presentation will be rather demanding and challenging, which will be more specified later during the class.
Contact Information: Chunyang Wang Room: C320
Email: cywang@phbs.pku.edu.cn
Office Hours: Thursday 2:00-4:00PM
Teaching Assistant: Wei Chen
Email: clairechen@sz.pku.edu.cn
Prerequisite:
Mankiw, Gregory “Principle of Macroeconomics” 5thEdition
Assessment:
Presentation(50%): The qualityof presentation will be judgedby various standards, such as the difficulty level ofthe paper, and presentation time (latter presenters will have more experience fromthe class.) There will be a specific guideline on how to present a paper.
Enrollment (10%): You will find your absence or not paying attention in class will leave your presentation very bad. Only the school official notice for absence is recognized.
Class Participation (10%): Class discussion will be strongly encouraged and sometimes will be required. For example, you names willbe called randomly. If you are absent, you will lose both your enrollment score and participation score.
You will automatically fail theclass if you miss three classes.
Final report (20%): The final report will bean extension of any presentation by you or others which you find interesting. It can focus on some specific topic, or some continuation, or some recent news update of the paper.
Teaching Schedule: (I will teach inthe following order. But the exact time will depend on the proceeding of the class.)
DWDiamond, PH Dybvig (1983) “Bank runs, deposit insurance, and liquidity” The journal of political economy
RaghuramG. Rajan, 2005. "Has financial development made the world riskier?," Proceedings, Federal Reserve Bank ofKansas City, issue Aug, pages 313-369
Paul Goldsmith-Pinkham · TanjuYorulmazer2010. “Liquidity, Bank Runs, and Bailouts: Spillover Effects
During the Northern Rock Episode” Journal of Financial Services Research
Carmen M. Reinhart Kenneth S. Rogoff2008 “This Time is Different: A Panoramic
View of Eight Centuries ofFinancial Crises” NBER
Franklin Allen, Jun "QJ" Qian, MeijunQian and Mengxin Zhao 2008 “A Review of
China's Financial System and Initiatives for the Future” Wharton Finance Working paper
Paper for Presentation: (The selection of the paper hasthe “first come, first serve” policy. The TA will coordinate with you on group formation and topic selection.)(Threestudents will forma group. Each group has about1 hour to present. These papers will bedistributed by the TA)
T. Hoshi, A. Kashyap 2011 “Why Did Japan StopGrowing?”National Institute for
Research Advancement
Barry Bosworth and Susan M. Collins 2008 “Accounting for Growth: Comparing China and India” Journal of Economic Perspectives
Markus K. Brunnermeier 2009 “Deciphering the Liquidity and Credit Crunch 2007–
2008” Journal of Economic Perspectives
Ben S. Bernanke, Carol Bertaut, Laurie Pounder DeMarco, and Steven Kamin 2011, “International Capital Flows and the Returnsto Safe Assets in the United States, 2003-
2007” Board of Governors of the Federal Reserve SystemInternational Finance
Discussion Papers Number 1014
Justin Yifu Lin 1995 “The Needham Puzzle:Why the Industrial Revolution Did Not
Originate in China” Economic Development and Cultural Change, Vol. 43, No. 2
AshvinAhuja, Lillian Cheung, Gaofeng Han, Nathan Porter and Wenlang Zhan 2010 “ARE HOUSE PRICES RISING TOO FAST IN CHINA?” Research Department of Hong Kong Monetary Authority Asia-Pacific Department of International Monetary Fund
Olivier J. Blanchard 2008 “THE STATE OF MACRO” NBER WORKING PAPER SERIES
RaghuramG. Rajan, 2005. "Has financial development made the world riskier?," Proceedings, Federal Reserve Bank ofKansas City, issue Aug, pages 313-369
Paul Goldsmith-Pinkham · TanjuYorulmazer2010. “Liquidity, Bank Runs, and Bailouts: Spillover Effects
During the Northern Rock Episode” Journal of Financial Services Research
Carmen M. Reinhart Kenneth S. Rogoff2008 “This Time is Different: A Panoramic
View of Eight Centuries ofFinancial Crises” NBER
Franklin Allen, Jun "QJ" Qian, MeijunQian and Mengxin Zhao 2008 “A Review of
China's Financial System and Initiatives for the Future” Wharton Finance Working paper
Paper for Presentation: (The selection of the paper hasthe “first come, first serve” policy. The TA will coordinate with you on group formation and topic selection.)(Threestudents will forma group. Each group has about1 hour to present. These papers will bedistributed by the TA)
T. Hoshi, A. Kashyap 2011 “Why Did Japan StopGrowing?”National Institute for
Research Advancement
Barry Bosworth and Susan M. Collins 2008 “Accounting for Growth: Comparing China and India” Journal of Economic Perspectives
Markus K. Brunnermeier 2009 “Deciphering the Liquidity and Credit Crunch 2007–
2008” Journal of Economic Perspectives
Ben S. Bernanke, Carol Bertaut, Laurie Pounder DeMarco, and Steven Kamin 2011, “International Capital Flows and the Returnsto Safe Assets in the United States, 2003-
2007” Board of Governors of the Federal Reserve SystemInternational Finance
Discussion Papers Number 1014
Justin Yifu Lin 1995 “The Needham Puzzle:Why the Industrial Revolution Did Not
Originate in China” Economic Development and Cultural Change, Vol. 43, No. 2
AshvinAhuja, Lillian Cheung, Gaofeng Han, Nathan Porter and Wenlang Zhan 2010 “ARE HOUSE PRICES RISING TOO FAST IN CHINA?” Research Department of Hong Kong Monetary Authority Asia-Pacific Department of International Monetary Fund
Olivier J. Blanchard 2008 “THE STATE OF MACRO” NBER WORKING PAPER SERIES
Burton G. Malkiel 2003 “The Efficient MarketHypothesis and Its Critics” The Journal of
Economic Perspectives, Vol. 17, No. 1
Justin Lin, Fang Cai, Zhou Li 2003 “The China Miracle: Development Strategy and
Economic Reform” The Chinese UniversityPress; Rev Sub edition (July 11, 2003)
Lee E. Ohanian 2010 “The Economic Crisis froma Neoclassical Perspective” Journal of
Economic Perspectives: Vol. 24 No. 4
Dennis Tao Yang 2012 “Aggregate Savings and External Imbalances in China” Journal of Economic Perspectives—Volume26, Number 4
Kazuo Ueda 2012 “Deleveraging and MonetaryPolicy: Japan since the 1990s and the
United States since 2007” Journal of Economic Perspectives—Volume 26, Number 3
Arvind Krishnamurthy 2010 “How Debt Markets Have Malfunctioned in the Crisis” Journal of Economic Perspectives—Volume 24, Number 1
Yasheng Huang 2012 “How Did China Take Off?” Journal of Economic Perspectives— Volume 26, Number 4
Philip R. Lane 2012 “The European Sovereign Debt Crisis” Journal of Economic
Perspectives—Volume 26, Number 3
Darrell Duffie 2010 “The Failure Mechanics of Dealer Banks” Journal of Economic
Perspectives—Volume 24, Number 1
Gordon H. Hanson 2012 “The Rise of Middle Kingdoms: Emerging Economies in Global
Trade” Journal of Economic Perspectives—Volume 26, Number 2
Xiaodong Zhu 2012 “Understanding China’s Growth: Past, Present, and Future” Journal of Economic Perspectives—Volume26, Number 4
Robert E. Hall 2010 “Why Does the Economy Fallto Pieces after a Financial Crisis?” Journal of Economic Perspectives—Volume 24, Number 4
Filipe R. Campante and DavinChor 2010 “Why Does the Economy Fall to Pieces
Economic Perspectives, Vol. 17, No. 1
Justin Lin, Fang Cai, Zhou Li 2003 “The China Miracle: Development Strategy and
Economic Reform” The Chinese UniversityPress; Rev Sub edition (July 11, 2003)
Lee E. Ohanian 2010 “The Economic Crisis froma Neoclassical Perspective” Journal of
Economic Perspectives: Vol. 24 No. 4
Dennis Tao Yang 2012 “Aggregate Savings and External Imbalances in China” Journal of Economic Perspectives—Volume26, Number 4
Kazuo Ueda 2012 “Deleveraging and MonetaryPolicy: Japan since the 1990s and the
United States since 2007” Journal of Economic Perspectives—Volume 26, Number 3
Arvind Krishnamurthy 2010 “How Debt Markets Have Malfunctioned in the Crisis” Journal of Economic Perspectives—Volume 24, Number 1
Yasheng Huang 2012 “How Did China Take Off?” Journal of Economic Perspectives— Volume 26, Number 4
Philip R. Lane 2012 “The European Sovereign Debt Crisis” Journal of Economic
Perspectives—Volume 26, Number 3
Darrell Duffie 2010 “The Failure Mechanics of Dealer Banks” Journal of Economic
Perspectives—Volume 24, Number 1
Gordon H. Hanson 2012 “The Rise of Middle Kingdoms: Emerging Economies in Global
Trade” Journal of Economic Perspectives—Volume 26, Number 2
Xiaodong Zhu 2012 “Understanding China’s Growth: Past, Present, and Future” Journal of Economic Perspectives—Volume26, Number 4
Robert E. Hall 2010 “Why Does the Economy Fallto Pieces after a Financial Crisis?” Journal of Economic Perspectives—Volume 24, Number 4
Filipe R. Campante and DavinChor 2010 “Why Does the Economy Fall to Pieces
after a Financial Crisis?”Journal ofEconomic Perspectives—Volume 24, Number 4
Gary Gortonand Andrew Metrick2012 “Getting Up to Speed on the Financial Crisis: A One-Weekend-Reader's Guide” Journal ofEconomic Literature: Vol. 50 No. 1
ChenggangXu 2011 “The Fundamental Institutions of China's Reforms and
Development” Journal of Economic Literature 2011, 49:4, 1076–1151 (Four People)
Ashok Kotwal, Bharat Ramaswami, andWilimaWadhwa2011“Economic
Liberalization and Indian Economic Growth: What's the Evidence?” Journal of Economic
Literature 2011, 49:4, 1152–1199
Deng, Yongheng, Randall Morck, Jing Wu, and Bernard Yeung. 2011. “Monetary
and Fiscal Stimuli, Ownership Structure, and China's Housing Market." NBER Working
Paper No.16871.
Franklin Allen, Jun “QJ” Qian, Chenying Zhang, Mengxin Zhao 2012 “CHINA’S FINANCIAL SYSTEM:OPPORTUNITIESAND CHALLENGES” NBER WORKING PAPERSERIES
Greenwood, Robin, and David Scharfstein. 2013. "The Growth of Finance." Journal of Economic Perspectives, 27(2): 3-28.
Thomas Philippon and AriellReshef.2012 Wages and Human Capital in the U.S. Financial Industry: 1909-2006, Quarterly Journal of Economics, November, (lead article)
Fernández-Villaverde, Jesús, Luis Garicano, and Tano Santos. 2013. "Political Credit Cycles: The Case of the Eurozone." Journal of Economic Perspectives, 27(3): 145-66.
Loren Brandt and Xiaodong Zhu 2000 Redistribution in a Decentralized Economy: Growth and Inflation in China under Reform, Journal of Political Economy.
Loren Brandt, Debin Ma, Thomas G. Rawski 2013 From Divergence to Convergence: Re-evaluating the History Behind China’s Economic Boom, Journal of Economic Literature, forthcoming
Kehoe, Timothy J., and Kim J. Ruhl. 2010. "Why Have Economic Reforms in Mexico Not Generated Growth?" Journal of Economic Literature, 48(4): 1005-27.(Actually a comparison with China.)
Shiue, Carol H., and Wolfgang Keller. 2007. "Markets in China and Europe on the Eve of the Industrial Revolution." American Economic Review, 97(4): 1189-1216.
Kay Giesecke, Francis A. Longstaff, Stephen Schaefer, IlyaStrebulaev 2013 “Macroeconomic effects of corporate default crisis: A long-term perspective”Journal of Financial Economicsforthcoming
Joseph D. Piotroski, Tianyu Zhang, 2013 “Politicians and the IPO decision: The impact of impending political promotions on IPO activity in China”, Journal of Financial Economics,Available online 26 October 2013, ISSN 0304-405X
Craig Doidge, G. Andrew Karolyi, René M. Stulz, 2013 “The U.S. left behind? Financial globalization and the rise of IPOs outside the U.S.,”Journal of Financial Economics, Volume 110, Issue 3, December 2013, Pages 546-573
Gary Gortonand Andrew Metrick2012 “Getting Up to Speed on the Financial Crisis: A One-Weekend-Reader's Guide” Journal ofEconomic Literature: Vol. 50 No. 1
ChenggangXu 2011 “The Fundamental Institutions of China's Reforms and
Development” Journal of Economic Literature 2011, 49:4, 1076–1151 (Four People)
Ashok Kotwal, Bharat Ramaswami, andWilimaWadhwa2011“Economic
Liberalization and Indian Economic Growth: What's the Evidence?” Journal of Economic
Literature 2011, 49:4, 1152–1199
Deng, Yongheng, Randall Morck, Jing Wu, and Bernard Yeung. 2011. “Monetary
and Fiscal Stimuli, Ownership Structure, and China's Housing Market." NBER Working
Paper No.16871.
Franklin Allen, Jun “QJ” Qian, Chenying Zhang, Mengxin Zhao 2012 “CHINA’S FINANCIAL SYSTEM:OPPORTUNITIESAND CHALLENGES” NBER WORKING PAPERSERIES
Greenwood, Robin, and David Scharfstein. 2013. "The Growth of Finance." Journal of Economic Perspectives, 27(2): 3-28.
Thomas Philippon and AriellReshef.2012 Wages and Human Capital in the U.S. Financial Industry: 1909-2006, Quarterly Journal of Economics, November, (lead article)
Fernández-Villaverde, Jesús, Luis Garicano, and Tano Santos. 2013. "Political Credit Cycles: The Case of the Eurozone." Journal of Economic Perspectives, 27(3): 145-66.
Loren Brandt and Xiaodong Zhu 2000 Redistribution in a Decentralized Economy: Growth and Inflation in China under Reform, Journal of Political Economy.
Loren Brandt, Debin Ma, Thomas G. Rawski 2013 From Divergence to Convergence: Re-evaluating the History Behind China’s Economic Boom, Journal of Economic Literature, forthcoming
Kehoe, Timothy J., and Kim J. Ruhl. 2010. "Why Have Economic Reforms in Mexico Not Generated Growth?" Journal of Economic Literature, 48(4): 1005-27.(Actually a comparison with China.)
Shiue, Carol H., and Wolfgang Keller. 2007. "Markets in China and Europe on the Eve of the Industrial Revolution." American Economic Review, 97(4): 1189-1216.
Kay Giesecke, Francis A. Longstaff, Stephen Schaefer, IlyaStrebulaev 2013 “Macroeconomic effects of corporate default crisis: A long-term perspective”Journal of Financial Economicsforthcoming
Joseph D. Piotroski, Tianyu Zhang, 2013 “Politicians and the IPO decision: The impact of impending political promotions on IPO activity in China”, Journal of Financial Economics,Available online 26 October 2013, ISSN 0304-405X
Craig Doidge, G. Andrew Karolyi, René M. Stulz, 2013 “The U.S. left behind? Financial globalization and the rise of IPOs outside the U.S.,”Journal of Financial Economics, Volume 110, Issue 3, December 2013, Pages 546-573
Guidelines for Presentation
1. Every presentation should have a Key Sentence,whichshouldappearinoneof the first three slides. Thepurpose is for audience not to be lost, and with this key sentence, they can better understandyour motivation slides and others.
2. Do not try to confuse people to make you appear knowledgeable. If I cannot figure out what you aretalking about,I will randomly callanother student or ask you to pick any student in the classroom to see whether he/she understands or not. Your work should be easily understood by your grandma, just like Poet JuyiBairead poemto old women to check whether they understand the poemor not. So if a professor with a PhD cannot understand what you are saying, your presentation is failing.
3. Do not show too many words in one side. People cannot read so much in such short time, and they cannot concentrate to listen to you when they are reading.
4. Asymmetry. You have already known the materials very well. Presentersoften ignore the fact that for most oftime, the audience has no idea of the topic. So it’s better for you to think in the position of audience when you present.
5. If there is any figure, please first tell the audiencewhat x and y axis indicate, especially the y axis.
6. Respond in a professional way to rude questions. Responding in a rude way does not make yourself win but lose. The audience can judge who