Central Banking and Financial Regulation

Number of Lectures: 6-12
Total Hours: 24 Marking: MCT – 30%; Final Exam – 70%

This module covers the study of monetary policy both at conventional and unconventional level. It explores the powers of central banks over the economy. The unit covers traditional central banking tools such as the discount window, central bank reserves and open market transactions, but also unconventional and informal policy tools. The inability of standard economics theories to either explain macroeconomic performance or banking system instability is explored. The module makes use of empirically-based analysis to demonstrate the flaws with current approaches to economics and central banking. The lectures cover the impact of unconventional monetary policies (zero-lower bound interest rates, quantitative easing) on the economic performance of a country. The module also provides insights in the potential impact of theorised new financial instruments for stimulating economic growth such as the implementation of cryptocurrency, the “war on cash”, the effects of a pure e-economy and “helicopter money”. On the financial regulation side, the course investigates the impact and validity of capital regulations (the Basel Accords) on the banking system.