D_TRMP Theory and Application of Monetary Policy

University of Finance and Administration
Winter 2022
Extent and Intensity
2/0/0. 10 credit(s). Type of Completion: DZk (doctoral examination).
Guaranteed by
prof. Dr. Ing. Jan Frait
Department of Finance - Departments - University of Finance and Administration
Contact Person: Lenka Pokorná
Prerequisites
none
Course Enrolment Limitations
The course is offered to students of any study field.
Course objectives
The course links theoretical study of monetary policy and conceptual issues in its implementation. It therefore focuses on selected problem areas of theory that have relevance to the policies and decisions of central banks in the monetary field. Its aim is to update the principles, context and directions of monetary theory and the establishment of a poznatkového background for interpretation of trends and problems of monetary policy.
Learning outcomes
At the end of the course the student will be able to understand theoretical and model underpinnings of monetary policy making of key central banks as well as central banks in small open economies. He or she will get insight into the ways of conduct of monetary policies following the global financial crisis and the potential impacts and side effects of such monetetary policies. Student will understand the links between monetary policy and macroprudential policy and will be able to assess the effects of changes in monetary policy tools on business and financial cycles. He or she will understand the limitations of current models of central banks based on the DSGE approaches.
Syllabus
  • Course Content Characteristics of modern monetary policy: - Functions, goals and effectiveness of monetary policy - Developmental stage of monetary policy - Institutional arrangements and operating monetary policy - Reaction function of the central bank - Central bank independence Theoretical background of monetary policy: - Basic currents of modern economic thought - Monetarist transmission mechanism, money exogeneity - The transmission mechanism of interest rates, the theory of endogenous money - Other transmission channels - Rules and discretion in monetary policy - The time inconsistency in monetary policy Monetary policy strategy (monetary policy regimes) - Targeting selected variables in practice of central banks - The quantity theory of money as a theoretical base money targeting - Targeting the exchange rate - Theoretical targeting the exchange rate: the theory of purchasing power parity - Inflation targeting, strict versus flexible inflation targeting - Inflation targeting in the context of economic theory: new neoclassical synthesis - DSGE models Inflation targeting: monetary policy strategy CNB - Prerequisites for the effectiveness of inflation targeting - Specification of inflation targets - Compliance with inflation targets - Macroeconomic Forecasts - Communication of monetary policy
Literature
    required literature
  • Frait, J., Komárek, L, Komárková, Z. (2011): Monetary Policy in a Small Economy after the Tsunami: A New Consensus on the Horizon? Czech Journal of Economics and Finance 61, No. 1, pp. 5-33
  • Bain, K., Howells, P. (2003): Monetary economics. Policy and its theoretical basis. Palgrave
    recommended literature
  • Williams, R. ed. (2020): Monetary policy handbook. RNBZ
  • Cecioni, M., Ferrero, G., Secchi, A. (2021): Unconventional Monetary Policy in Theory and in Practice. In: Innovative Federal Reserve Policies During the Great Financial Crisis
  • Revenda, Z., a kol., Peněžní ekonomie a bankovnictví, Praha, Management Press 2014.
  • Mandel, M., Tomšík,V., Monetární ekonomie v období konvergence a krize, Praha, Management Press, 2018.
  • Pavlát, V., Centrální bankovnictví, VŠFS, Praha 2004.
  • Walsh, C. (2010): Monetary Theory and Policy. The MIT Press
  • Hrnčíř, M., Měnová teorie a politika, VŠFS, Eupress, 2010.
  • Friedman, B., Hahn, F., Woodford, M. (2021): Handbook of Monetary Economics, 3 volumes. Elsevier
Teaching methods
lectures
Assessment methods
seminar paper
Language of instruction
Czech
Further comments (probably available only in Czech)
The course can also be completed outside the examination period.
General note: Předmět doktorského studia.
Information on the extent and intensity of the course: 12 hodin KS/semestr.
Teacher's information
The list of recommended reading for individual themes, presentations of individual lectures, literature relating to issues of seminar papers and selected research and analysis designed especially for combined studies are the integral part of this syllabus (see the study materials).
The course is also listed under the following terms Winter 2010, Winter 2011, Winter 2012, Winter 2013, Winter 2014, Winter 2015, Winter 2016, Winter 2017, Winter 2018, Winter 2019, Winter 2020, Winter 2021.
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