GINS 2010 Lecture Notes - Lecture 8: Financial Institution, Aggregate Demand, Money Supply
Document Summary
Introduction to open economy macroeconomics international financial crises. By the end of this lecture, you should be able to understand; Principles of open macroeconomy: balance of payment, current account, capital account, financial account. What policies governments need to use to move their economies to a balanced position; i. e. how to reduce the financial debt, in other words, how to pay for the current financial deficit. How the deficit or surplus of balance of payment affects a country"s fiscal and monetary policy. How governments use fiscal and monetary policy to regulate their economies and currencies. The nature of international financial crises, and policies that governments can use to address them. If we consume more imported than nationally produced goods, our country"s imports grow. If we prefer to consume more locally-produced goods that also others demand abroad, our exports might decrease. The values of domestic currencies and financial markets.