The course instructs students about stylised facts on the origins and causes of financial crises; their link to public finances; explores the role and capability of the government to manage effectively the private and public financial sectors in crisis and normal times. The role of regulation of financial sectors will be studied.

10 x 2 hour lectures

1 x 1 hour revision lecture.

Please refer to MyCampus for timetable.

None.

None.

1. Written assignment, including essay; Individual; 1250 words; 30%; ILOs 4-5.
2. Degree exam: in-person; Individual; 120 minutes; 70%; ILOs 1-3.

The main aims of this course are to cover the following broad areas:

■ Stylised facts on the origins and causes of financial crises and their link to the public finances.

■ Develop benchmark theoretical and empirical models building on historical record.

■ Policy responses - how governments, in their roles as guardians of public finance, cope with the fallout of financial crises - both in the short run and over the long run, via regulation of the private and public financial sectors.

■ Micro prudential regulation, macro prudential regulation, corporate governance.

By the end of this course students will:

 1. display knowledge of the historical record of financial crises and their impact on the wider economy and public sector balance sheets.

2. display knowledge of the theoretical models that can explain issues relating to financial crises, the role of public finance and empirical studies which complement these issues.

3. be able to carry out critical analysis using the theoretical and empirical analyses found in the literature.

4. be able to identify problems with the effectiveness of existing public and regulatory policies.

5. carry out independent research to critically evaluate, using academic literature, data and historical examples, the ability of governments to face and prevent financial crises using the public finances and other policies.