Module
Monetary Unions and Global Business

Type
Core GBM module (30 hours)

ECTS
5

UoW credits
10

Coordinator
Pawel Mlodkowski, PhD

Overall Aims and Purpose

The course builds on knowledge gained in International Economics, and expands on issues related to business within monetary union and monetary integration implications for the global financial markets.

Course Content

I. Introduction – OCA theory: Mundell, Kennen, McKinnon, De Grauwe
II. History and operations of monetary unions in the global economy:
• Eastern Caribbean Curency Union,
• Common Monetary Area – CMA,
• West African Economic and Monetary Union,
• Central African Economic and Moneatry Community,
• Semi-currency union - dollarization
• Planned monetary unions: Persian Gulf, Yen Currency Area
III. Fiscal convergence in monetary unions. The need to impose restrictions on national fiscal authorities when monetary policy autonomy lacks
IV. Balance of Payments of a monetary union, foreign exchange restrictions, bi-exchange rates regimes.
V. Foreign exchange reserves management by common central banks and the stability of the global financial system
VI. Monetary union implications for production, trade and investment.
VII. Costs and benefits (micro&macro-level) of a monetary union for all agents in the union’s economy

Reading list

Essential
1. De Grauve P.,2004, “Economics of monetary integration, 2th ed. Oxford University Press
2. Macroeconomics / N. Gregory Mankiw. - 5th edition. - New York : Worth Publishers, 2003
3. International economics / Dominick Salvatore. - 8th edition. - New York : John Wiley and Sons, 2004

Suggested

1. Mlodkowski P., 2005, “Fiscal policy flexibility in monetary union member countries, Karvina University
2. Mlodkowski P., 2005, “Transaction costs liquidation in new Euro Area member states, Bielsko-Biala, WSBiF
3. IMF Working Papers & Country Reports on monetary unions