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Course Outlines

ECON 3510 - International Finance III

North Terrace Campus - Semester 1 - 2014

This course deals with the analysis of two important and related macroeconomics issues in open economies: the exchange rate and the capital flows. The objectives of the course are two-fold: to introduce the main concepts, principles and models in the theory and empirical works in those two key areas of International Finance; to apply analytical tools to understand the relevant policy issues in the global markets. Based on additional reading materials, discussions on relevant current events from various parts of the globe will be carried out.

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  • General Course Information
    Course Details
    Course Code ECON 3510
    Course International Finance III
    Coordinating Unit Economics
    Term Semester 1
    Level Undergraduate
    Location/s North Terrace Campus
    Units 3
    Contact Up to 3 hours per week
    Prerequisites ECON 2506 & ECON 2507
    Incompatible ECON 3032
    Assessment Typically tutorial work, mid-semester test & final exam
    Course Staff

    Course Coordinator: Dr Raul Barreto

    Office location: Nexus 10, Level 4, Room 4.26
    Telephone:       8313 3240

    Course Timetable

    The full timetable of all activities for this course can be accessed from .

  • Learning Outcomes
    Course Learning Outcomes
    On successful completion of this course students will be able to:
    1 understand, at the level of formal analysis, the major models of international trade and be able to distinguish between them in terms of their assumptions and economic implications
    2 understand the principle of comparative advantage and its formal expression and interpretation within different theoretical models
    3 be able to apply partial equilibrium and (where required) general equilibrium models in analysing the economic effects of (a) trade policy instruments such as tariffs, quotas, export subsidies, (b) retaliatory measures such as anti-dumping duties and countervailing duties and (c) the creation of regional trading arrangements such as free trade areas, customs unions and common markets
    4 be familiar with, and be able to critically analyse the main arguments for protection and conversely be able to critically evaluate the relevance and realism of arguments for free trade, taking into account the costs and benefits of trade policy measures on different sections of the community and the implications for the formulation of trade policy
    5 be familiar with the major recent developments in the world trading system, and be able to critically analyse key issues raised both by the current round of WTO negotiations and by the spread of regional trading arrangements
    6 develop communications skills through the presentation of your work, interactions during tutorial sessions, and appropriate use of the discussion board
    University Graduate Attributes

    This course will provide students with an opportunity to develop the Graduate Attribute(s) specified below:

    University Graduate Attribute Course Learning Outcome(s)
    Knowledge and understanding of the content and techniques of a chosen discipline at advanced levels that are internationally recognised. 1-6
    The ability to locate, analyse, evaluate and synthesise information from a wide variety of sources in a planned and timely manner. 1-6
    An ability to apply effective, creative and innovative solutions, both independently and cooperatively, to current and future problems. 1-6
    Skills of a high order in interpersonal understanding, teamwork and communication. 1-6
    A proficiency in the appropriate use of contemporary technologies. 1-6
    A commitment to continuous learning and the capacity to maintain intellectual curiosity throughout life. 1-6
    A commitment to the highest standards of professional endeavour and the ability to take a leadership role in the community. 1-6
    An awareness of ethical, social and cultural issues within a global context and their importance in the exercise of professional skills and responsibilities. 1-6
  • Learning Resources
    Required Resources
    Exchange Rates and International Finance, (4th or 5th Edition) Laurence Copeland, Prentice Hall/Financial Times (Pearson Education), 2005/8
    Recommended Resources

    There are several other texts which could have been used on this course. None are recommended here as substitutes to Copeland, since the different texts use a variety of approaches to the models to be discussed, and this can be a source of confusion. Nevertheless

    One supplementary text which is of value to course participants is An Introduction to International Money and Foreign Exchange Markets, by Charles Van Marrewijk. It provides particularly good discussions of purchasing power parity and interest rate parity.

    It is available at  

    Online Learning
    MyUni -  

    Othe