The financial market is pivotal in driving economic efficiency, growth, and development across many nations. Yet, increasing economic volatility linked to financial market activities underscores the critical role of central banks, particularly in shaping monetary policy and overseeing banking systems and
financial markets.
This course is divided into two core segments. The first provides a concise yet thorough review of monetary theory in macroeconomics. It begins by exploring the significance of interest rates and their role in the IS curve, alongside money market equilibrium. We then construct the dynamic AD-AS model,
offering insights into macroeconomic policies aimed at stabilizing the economy. Through this, students will gain a clear understanding of how central banks influence economic outcomes.
The second segment delves deeper into macroeconomic policies, with a focus on monetary policy and the pivotal role of central banks. Building on foundational concepts from the first part, students will explore the frameworks, strategies, and tools central banks use to implement monetary policy. This includes an in-depth look at the money supply process, policy instruments, transmission mechanisms, and the interplay with exchange rate policies. Students will also examine the complexities and challenges central banks face in executing effective monetary policy.
Through SMU-X’s experiential learning approach, students will tackle real-world challenges faced by the Central Bank of Vietnam. These projects allow students to apply theoretical knowledge to practical problems, such as selecting appropriate policy tools, modernizing monetary frameworks, strengthening financial market oversight, and calibrating exchange rate flexibility. These tasks require interdisciplinary knowledge, fostering critical thinking, problem-solving, and collaboration skills. Students will also hone their ability to communicate ideas effectively to stakeholders.
As an SMU-XO course, this program includes an immersive experience in Vietnam. Students will engage with the country’s culture and economy through guest lectures, interactions with local students, and business visits. This cross-cultural exposure enhances global awareness and cultural competence, fulfilling the Global Exposure requirement and enriching students’ perspectives.
Teamwork is a cornerstone of the course, accounting for 50% of the final grade. Students will develop collaboration, communication, and leadership skills while working under time constraints to complete challenging group tasks. Peer evaluations ensure fair participation and recognize exceptional contributions.
This course aims to help students:
- Understand the key theories and strategies in Monetary Policy and Financial Markets Management, especially from the Central Bank's point of view.
- Solve real-world problems with a project partner (related to Monetary Policy or Financial Markets) and learn how to work in a project group.
- Gain insight into financial markets as well as the business environment and culture in Vietnam through mini cultural activities and Vietnam theme presentations.
- Develop potential networking, and other life skills through the study mission and by interacting with business leaders in Vietnam (through guest speaker sessions) as well as local students.
