Shidler College of Business University of Hawai i at Manoa Summer Bus 313 Economic & Financial Environment of Global Business

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1 Shidler College of Business University of Hawai i at Manoa Summer 2018 Bus 313 Economic & Financial Environment of Global Business Instructor: Alex Hittle Office Hours: By Arrangement aahittle@hawaii.edu MTWTF: 10:30-11:45 am Location: Shidler C101 Course Description: BUS 313 The Economic & Financial Environment of Global Business introduces students to the theory of trade and international finance. Using that theoretical foundation, the course will examine a number of global regions and particular case studies. The objective of the course is to: 1. Review how we got here. 2. Discuss where we are now (i.e. what does here look like) 3. Consider what the future holds during your career span 4. Give you the language and tools to make that analysis Textbook and Materials: Textbook: International Economics, 6 th Edition, James Gerber, Pearson. Grading Structure: Midterm one: 20% Midterm two: 20% Final: 30% Issue Briefing 20% (Pass/Fail) Attendance: 10% The midterms will be on the material from the topics presented in Part I and then Part II of the course. The final will be cumulative. Exams will include quantitative problems with point answers as well as short answer problems. Calculators will be permitted. Exams will be curved at my discretion. THE TWO MIDTERMS AND THE FINAL WILL BE THE MOST IMPORTANT ELEMENTS IN DETERMINING YOUR FINAL LETTER GRADE. The issue briefing will require the student to make a concise oral background presentation to the class (2-3 minutes) and a short (1-2 page) written briefing document. It is meant to simulate the sort of work one would do in a

2 business/government environment. Ideally, the written briefing could serve as writing sample in a job application. This whole project will be graded as pass/fail. Please be aware of two things about this project: 1. You and most of your peers will Pass this project. Therefore, while it will be important to complete the project in order to pass the course, completing it will have little or no impact on what letter grade you get for the course. 2. While I overwhelmingly give a strait pass mark to students, I will deduct points at my discretion for gross failure to complete parts of the assignment in timely and responsible fashion (e.g. taking an unexcused absence on a day when you are scheduled to present.) I believe that attendance is important. My lectures use the book as a starting point, but branch off into new material from there. I draw heavily from what I discuss in lectures to develop my exams and have found a consistent relationship between poor attendance and poor grades. I take attendance sporadically and may call on you to prepare an issue briefing or an update on your issue. If I call out your name and you are not there, it looks bad. If you do poorly on the midterms and I see that you have not been attending class much, I will not be very sympathetic. I also understand that things come up in life, as a courtesy, I encourage you to you alert me ahead of time that you can t make a class a brief will do. NOTE THAT OTHER STUDENTS USUALLY SHOW UP, SO CONSISTENT ATTENDANCE IS UNLIKELY TO DIRECTLY BOOST YOUR GRADE, BUT A LARGE NUMBER OF UNEXCUSED ABSENCES MAY HURT YOU. Make-up exams can only be made under unusual circumstances. If there is a reason you cannot take an exam, you must make arrangements before the exam. Unless approved in advance, no make-up exam will be given. Academic Dishonesty: It is not worth it! It is much easier to simply learn the material rather than cheat. So don t do it. Instances of academic dishonesty, as defined by the University Student Conduct Code: ( will not be tolerated and may result in a grade of F.

3 Bus 313 Economic & Financial Environment of Global Business PART 1: Introduction and the Microeconomic Analysis of Trade Class: Date: Topic(s): Reading: 1 5/21 Introduction: None - Course structure - Main themes 2 5/22 Globalization and the Disasters: Chapter 1 - Review of Supply and Demand Curves - Edwardian Europe and the gold standard - Depression and Wars 3 5/23 After the Disasters: Chapter 2 - Review of Monetary and Fiscal Policy - The Bretton Woods System - The World Bank - The IMF - The GATT 4 5/24 Trade - Microeconomic Approaches: Chapter 3 Adam Smith Absolute Advantage David Ricardo Comparative Advantage 5 5/25 Gains from Trade: Chapter 4 Heckscher-Ohlin 5/28 Day Off Memorial Day 6 5/29 Winners and Losers: Chapter 4 Stolper-Samuelson A Game! 7 5/30 Beyond Comparative Advantage: Chapter 5 - Economies of Scale - Economic Clusters - Industrial Policy 8 5/31 Theory of Trade Barriers: Chapter 6 - Tariffs - Quotas 9 6/1 Commercial Policy: Chapter 7 - Justifying tariffs and quotas - Problem/Study sheet #1 handed out 10 6/4 Review of Problem/Study sheet #1 Chapter /5 Labor and Environmental Standards: 12 6/6 MIDTERM #1

4 PART 2: International Finance: Macroeconomic Theory, Trade, and Financial Flows Class: Date: Topic(s): Reading: 13 6/7 Balance of Trade and Payments: Chapter 9 - Balance of Trade - Balance of Payments - Fixed vs. floating rates 14 6/8 Exchange Rates: Chapter 10 - Supply/Demand Model - Long term: Purchasing power parity - Medium-term: Differing growth rates - Short-term: Interest arbitrage 6/11 Day off: Kamehameha Day 15 6/12 Walkthrough of Midterm #1 16 6/13 Open Economy Macroeconomics: Chapter 11 - Keynesian Multiplier and Leakages - Fiscal Policy Review - Monetary Policy Review 17 6/14 Open Economy Macroeconomics II: Chapter 11 - Fiscal Policy and Current Account - Monetary Policy and Current Account - Mundell-Fleming Trilemma 18 6/15 Financial Crashes in International Context: Chapter 12 - Bank crashes - Currency Crashes - Debt Crashes - Problem/Study Sheet #2 handed out 19 6/18 Discussion of Problem/Study Sheet # 2 Chapter 12 pp PART 3: Applying Theory Global Geography 20 6/19 Japan: Population: The most advanced collapse on earth. 21 6/20 Midterm #2 (on Part 2 only) 22 6/21 The United States: Robotic & IT Job Destruction: 23 6/22 The European Union: Globalization and integration: From Coal and Steel to the Euro Chapter 13 Chapter 14

5 Class: Date: Topic(s): Reading: 24 6/25 Walkthrough of Midterm #2 25 6/26 The BRICs #1 China Chapter 17 - The greatest economic miracle of all time 26 6/27 - Capstone Class Ethical Issues in the TBD Global Economy 27 6/28 - Review and Class Summary 28 6/29 Final Exam: