Instructor: Yanis Varoufakis
|Day & Time:||T 6:00 pm -9:00 pm|
“The economic health of every country is a proper matter of concern to all its neighbours, near and far.” FDR, 1944, at the opening of the Bretton Woods conference. Since FDR uttered these famous words, the global economy has become integrated to an extent that banking crises, debt crises, trade imbalances, rapid capital flows, currency ‘wars’, etc. can only be understood, and addressed, at a global level.
This course will focus on central macroeconomic issues of a global reach. A list of topics to be presented and discussed, with indicative readings, follows:
Week 1. Can public debt be too low (or too high)?
Reading: Tony Aspromourgos (2013). ‘Keynes, Lerner and Public Debt’, mimeo, University of Sydney
Week 2. Did the Fed cause the 2008 global financial crisis?
Reading: Yanis Varoufakis (2013). ‘United States Monetary Policy in the post-Bretton Woods Era: Did it cause the Crash of 2008?’, mimeo, University of Texas at Austin
Week 3: Inflation targeting versus permanently zero real interest rates
Reading: Tony Aspromourgos (2013). ‘Can (and should) monetary policy pursue a zero real interest rate, permanently?’, mimeo, University of Sydney
Week 4: Has Western Capitalism fallen into the trap of secular stagnation?
Reading/video: Lawrence Summers IMF presentation, click here for the transcript; Martin Wolf’s FT article; Mario Seccareccia on “Larry Summers, secular stagnation and the crisis of the new consensus model”, click here; and Carmen M. Reinhart and Kenneth S. Rogoff, December 2013 IMF paper entitled “Financial and Sovereign Debt Crises: Some Lessons Learned and Those Forgotten”
Week 5: Debt and Income Dynamics
Reading: Jan Toporowski (2013). ‘Two principles of debt and national income dynamics in a pure credit economy’, mimeo, SOAS, University of London
Week 6: The Third World Debt Crisis: 1970s and beyond
Reading: Eric Toussaint and Damien Millet (2010). Debt, the IMF and the World Bank, New York: Monthly Review Press; Chapters 2,3,4,5,6,7&9
Week 7: The Dollar’s Extraordinary Privilege
Reading: Barry Eichengreen (2011). Exorbitant Privilege: The rise and fall of the dollar, Oxford UP
Week 8: The macroeconomics of NAFTA
Reading: To be advised
Week 9: The macroeconomics of ASEAN
Reading: To be advised
Week 10: Inequality and its effects on macroeconomic stability
Reading: James Galbraith (2013). Inequality and instability, Oxford University Press
Week 11: Bitcoin and the dream of apolitical money
Reading: Yanis Varoufakis (2013). ‘Bitcoin and the dangerous fantasy of apolitical money’, mimeo, University of Texas; plus the ECB paper entitled ‘Virtual Currency Schemes’
Students will be graded for their presentation (20%), a long essay (40%) and a take home examination (40%).
Important note on Academic Integrity
Students are expected to respect the LBJ School’s standards regarding academic dishonesty. You owe it to yourself, your fellow students, and the institution to maintain the highest standards of integrity and ethical behavior. A discussion of academic integrity, including definitions of plagiarism and unauthorized collaboration, as well as helpful information on citations, note taking, and paraphrasing, can be found at the web page of the:
- Office of the Dean of Students (http://deanofstudents.utexas.edu/sjs/acint_student.php)
- Office of Graduate Studies (http://www.utexas.edu/ogs/ethics/transcripts/academic.html).
The University has also established disciplinary procedures and penalty guidelines for academic dishonesty, especially Sec. 11.304 in Appendix C of the Institutional Rules on Student Services and Activities section in UT’s General Information Catalog.