This seminar provides an overview of some of the most important issues in monetary and macro prudential policymaking, such as monetary policy transmission mechanism, instruments, rules, regimes, the problem of time inconsistency and the issues of financial stability. The goal is to enable students to apply the skills of economic analysis to the conduct of central banks and to the processes underlying the monetary transmission mechanism.
At the end of this course, among other things the students should be able to:
Identify the main components of the monetary policy transmission mechanism and the issues associated with monetary policy implementation.
Explain what monetary policy instruments and targets are, how they work and how they are used by central banks.
Explain the essence of most important monetary policy rules, their implementation and the crux of the debate on rules vs. discretion in monetary policy.
Explain the link between macroprudential regulation and traditional monetary policy.