Central banking and monetary economics 2600-MSFRz2buBCPP
The course outline:
1. The Evolution of Money and Monetary Systems
The history of money, its functions, and characteristics, types of monetary systems: commodity money, paper commodity-backed money, fiat (fiduciary) money, modern forms of money including cash, deposit money, electronic money, central bank digital currency (CBDC), cryptocurrencies, and stablecoins.
2. Functions of the Central Bank and Monetary Policy Instruments
Core functions of the central bank, a two-tier banking system, governance of the central bank (case studies: Poland, the eurozone, the USA, and other countries), balance sheet and income statement of the central bank, objectives of monetary policy, conventional and unconventional monetary policy instruments, transmission channels of monetary policy, the money market and the price of money in the interbank market, exchange rate policy, the trilemma (or "impossible trinity") of Jeffrey Frankel, financial stability, the financial safety net, and financial supervision
3. Money Supply and Demand for Money
High-powered money and monetary aggregates. the mechanism of money creation and the money multiplier, open market operations, the propensity to hold cash, absorption of excess liquidity, sterilisation of money, participants in the money circulation, motives for holding money, Keynesianism versus monetarism, the demand for money function, the equation of money circulation, velocity of money, monetisation index of the economy, the status of cash as legal tender
4. Inflation
Sources of inflation (demand-pull and cost-push), measuring inflation (core inflation, CPI, PPI, GDP deflator), inflation expectations, the direct inflation target, and the relationship between inflation, unemployment, and economic growth, the Phillips curve, equilibrium in goods and services markets and monetary markets (general equilibrium, IS-LM model), the policy mix of monetary and fiscal policies
5. Exchange Rates and the Balance of Payments
Exchange rate regimes (fixed and floating), convergence criteria for Poland's accession to the European Monetary Union, capital flows, international trade, trade balance, balance of payments, terms of trade, international competition in the context of rapid technological development
6. Payment Systems and Post-Trade Financial Market Infrastructure
Architecture of the payment system, payment systems, payment instruments, payment services, the institutional structure of the Polish payment system and the post-transaction infrastructure of the financial market, clearing and settlement securities systems, instant payments
Type of course
Mode
Learning outcomes
Student after completing the course:
Knowledge:
• Has a deep understanding of the terminology related to central banking and monetary policy within the disciplines of economics, finance, management and quality sciences, and legal studies. (K_W01)
• Has a thorough understanding of the principles, procedures, and practices related to central banking and monetary policy. (K_W02)
• Understands in-depth economic theories and models pertaining to central banking and monetary policy. (K_W03)
• Is well-versed in the legal regulations concerning central banking and monetary policy. (K_W04)
• Comprehends complex technological, social, political, legal, economic, and ecological processes and phenomena, and their impact on central banking and monetary policy. (K_W05)
Skills:
• Is able to accurately interpret complex technological, social, political, legal, economic, and ecological processes and phenomena, as well as their influence on central banking and monetary policy, using appropriate sources. (K_U02)
• Can independently and collaboratively prepare analyses, diagnoses, and reports on complex and atypical problems related to central banking and monetary policy, presenting them effectively, including in English, utilising information and communication technologies. (K_U03)
• Can plan, organise, and lead teamwork effectively. (K_U04)
• Demonstrates the ability for self-directed learning, enhancing acquired qualifications, and supporting others in this area. (K_U05)
Social Competencies:
• Is ready to evaluate and critically approach complex situations and phenomena related to central banking and monetary policy. (K_K01)
Assessment criteria
Interactive lecture supported by multimedia, discussion, clarification of key terms, student presentations and essays based on group work
Bibliography
Górka J. Mocna Polska to silna gospodarka (3 diamenty gospodarki: ekonomia wartości, umiaru i oszczędności) „Obserwator Finansowy”, nr 14, 3/2023, s. 6–9 i online
Górka J. Silna polska gospodarka. Transformacja oszczędności w inwestycje, „Obserwator Finansowy”, nr 15, 4/2023, s. 26-29 i online
Górka J. Kierunki rozwoju systemu płatniczego w Polsce, Obserwator Finansowy NBP, online, 3 kwietnia 2024
Górski M. Materiały do studiowania polityki pieniężnej, Wydawnictwo Naukowe Wydziału Zarządzania Uniwersytetu Warszawskiego, Warszawa, 2014
Kaźmierczak A. Polityka pieniężna w gospodarce otwartej¸ Wydawnictwo naukowe PWN, Warszawa 2021
Rösl G., Seitz, F., Tödter K-H., Doing away with cash? The welfare costs of abolishing cash. Institute for Monetary and Financial Stability, Goethe University Frankfurt, Working Paper Series No. 112, 2017
Rösl G., A present value concept for measuring welfare, Institute for Monetary and Financial Stability, Goethe University Frankfurt, Working Paper Series No.203, 2024
Seitz F., Godschalk H., Krüger M. The digital euro from a consumer, retailer and industry perspective, Study commissioned by the National Association of German Cooperative Banks (BVR), PaySys Consultancy GmbH, August 2024
Additional information
Additional information (registration calendar, class conductors, localization and schedules of classes), might be available in the USOSweb system: