JCU Logo
JOHN CABOT UNIVERSITY

COURSE CODE: "EC 480"
COURSE NAME: "Senior Seminar in Economics and Finance"
SEMESTER & YEAR: Fall 2016
SYLLABUS

INSTRUCTOR: Mary Merva
EMAIL: [email protected]
 HOURS: T 6:00PM 8:45PM
TOTAL NO. OF CONTACT HOURS: 45
CREDITS: 3
PREREQUISITES: Prerequisites: EC 301, EC 302 or EC 316, FIN 301, EC 360 or MA 209 (as of Fall 23)
OFFICE HOURS:
COURSE DESCRIPTION:
Designed to be a capstone course, emphasis is placed on both theoretical and quantitative methods in the fields of economics and finance. Basic tools of economics and statistics are used to analyze a variety of contemporary economic problems and policy issues. Students read through major papers and may undertake research on specific topics so as to develop their understanding of economics and finance. Papers and topics cover the current issues of interest in the areas of microeconomics, macroeconomics, econometrics, and finance to include the CFA Professional Code of Ethics and Standards of Professional Conduct. Students may be expected to present and write about their research topics as well as demonstrate an ability to work with quantitative information. The course is structured into modules/sections taught by a group of faculty members.
SUMMARY OF COURSE CONTENT:
This course aims at enhancing quantitative and mathematical reasoning skills, as well as developing the ability to communicate effectively in written, spoken, and graphical form. It also aims at enhancing knowledge in the field of Economics and Finance. Designed to be a capstone course, emphasis will be put on both theoretical and quantitative methods. Basic tools and methods of economics and statistics are used to understand and analyze a variety of contemporary economic problems and policy issues chosen by the instructors.
LEARNING OUTCOMES:

LOS 1:  Build a solid understanding of and knowledge base in microeconomics, macroeconomics, and finance.            

LOS 2:  Development of critical-thinking skills and learn to apply economic analysis to understand economic events and everyday problems.

LOS 3:  Learn how to us empirical evidence in evaluating economic problems and theories, and to evaluate strategic business and policy proposals.

LOS 4:  Mastering research methods in the field and develop the ability to gather research data, conduct basic statistical analysis and interpret results. 

LOS 5:  Develop adequate training in mathematical methods to develop problem-solving skills, perform proofs and prepare for further graduate studies in the areas of economics and finance.

LOS 6:  Master solid communication skills that enable students to formulate a well-organized argument and communicate effectively in written, spoken, and graphical form about specific economic and financial issues.

LOS 7:  Gain awareness of the CFA Code of Ethics and Standards of Professional Conduct.

 
TEXTBOOK:
NONE
REQUIRED RESERVED READING:
NONE

RECOMMENDED RESERVED READING:
NONE
GRADING POLICY
-ASSESSMENT METHODS:
AssignmentGuidelinesWeight
Equity Research ReportStudents prepare an equity research report on a selected stock. Guidelines are in the Frohring Library Research Guides for EC 480.15%
White Paper on Sovereign DebtGuidelines are in the Frohring Library Research Guides for EC 48020%
CFA Ethics and Professional Standards TestIn class multiple choice exam.10%
Seminar DiscussionsIn class discussions on assigned papers and/or topics on the syllabus. Students are expected to participate, contribute, and lead discussions demonstrating competency in the assigned work.15%
Microeconomics Research Paper and PresentationGuidelines are posted on MyJCU.40%

-ASSESSMENT CRITERIA:
AWork of this quality directly addresses the question or problem raised and provides a coherent argument displaying an extensive knowledge of relevant information or content. This type of work demonstrates the ability to critically evaluate concepts and theory and has an element of novelty and originality. There is clear evidence of a significant amount of reading beyond that required for the course. 93-100: A 90-92.99: A-
BThis is highly competent level of performance and directly addresses the question or problem raised.There is a demonstration of some ability to critically evaluatetheory and concepts and relate them to practice. Discussions reflect the student’s own arguments and are not simply a repetition of standard lecture andreference material. The work does not suffer from any major errors or omissions and provides evidence of reading beyond the required assignments. 86-89.99: B+ 83-85.99: B 80-82.99: B-
CThis is an acceptable level of performance and provides answers that are clear but limited, reflecting the information offered in the lectures and reference readings. 75-79.99: C+ 70-74.99: C 65-69.99: C-
DThis level of performances demonstrates that the student lacks a coherent grasp of the material.Important information is omitted and irrelevant points included.In effect, the student has barely done enough to persuade the instructor that s/he should not fail. 60-64.99: D+ 55-59.99: D 50-54.99: D-
FThis work fails to show any knowledge or understanding of the issues raised in the question. Most of the material in the answer is irrelevant. Below 50
-ATTENDANCE REQUIREMENTS:

ATTENDANCE REQUIREMENTS AND EXAMINATION POLICY





You cannot make-up a major exam (midterm or final) without the permission of the Dean’s Office. The Dean’s Office will grant such permission only when the absence was caused by a serious impediment, such as a documented illness, hospitalization or death in the immediate family (in which you must attend the funeral) or other situations of similar gravity. Absences due to other meaningful conflicts, such as job interviews, family celebrations, travel difficulties, student misunderstandings or personal convenience, will not be excused. Students who will be absent from a major exam must notify the Dean’s Office prior to that exam. Absences from class due to the observance of a religious holiday will normally be excused. Individual students who will have to miss class to observe a religious holiday should notify the instructor by the end of the Add/Drop period to make prior arrangements for making up any work that will be missed.

Attendance is mandatory.

 
ACADEMIC HONESTY
As stated in the university catalog, any student who commits an act of academic dishonesty will receive a failing grade on the work in which the dishonesty occurred. In addition, acts of academic dishonesty, irrespective of the weight of the assignment, may result in the student receiving a failing grade in the course. Instances of academic dishonesty will be reported to the Dean of Academic Affairs. A student who is reported twice for academic dishonesty is subject to summary dismissal from the University. In such a case, the Academic Council will then make a recommendation to the President, who will make the final decision.
STUDENTS WITH LEARNING OR OTHER DISABILITIES
John Cabot University does not discriminate on the basis of disability or handicap. Students with approved accommodations must inform their professors at the beginning of the term. Please see the website for the complete policy.
SCHEDULE

Week 1 August 30 Financial Assets: valuation and risk (Professor Merva)

Researching economics and finance: summarizing information for policy and decision-makers: Information resources and writing: the White Paper and the Position Paper.  Library Information Session.

Begin Assignment 1 (20%): Prepare an equity research report and presentation for one selected stock.  Guidelines on the Frohring Library website: http://johncabot.libguides.com/EC480/equity-research-report

Report and presentation due Week 3.  The presentation should last 20 minutes.

Begin Assignment 2 (20%) White Paper:  You have been asked by your employer, a pension fund, to provide a review the ratings of a specific country’s sovereign debt.  You must provide a 4 to 5-page White Paper for your client and give a 20-minute summary report with 3 to 10 power point slides maximum.

Presentations in Week 4; final paper due at the beginning of class Week 5.

See the guidelines on the Frohring Library website for White Papers: http://johncabot.libguides.com/EC480/white-papers

Background Readings to prepare for Week 2:

 The Economics and Law of Sovereign Debt and Default Author(s) Ugo Panizza, Federico Sturzenegger and Jeromin Zettelmeyer, Journal of Economic Literature, Vol. 47, No. 3 (Sep., 2009), pp. 651-698,

To Judge Leviathan: Sovereign Credit Ratings, National Law, and the World Economy Author(s): Christopher M. Bruner and Rawi Abdelal, Journal of Public Policy, Vol. 25, No. 2 (May - Aug., 2005), pp. 191-217.

The European Sovereign Debt Crisis Author: Philip R. Lane, Journal of Economic Perspectives, Vol. 26, No. 3 (Summer 2012), pp. 49-67.

Toward A Bottom-Up Approach to Assessing Sovereign Default Risk: An Update

Edward I. Altman, New York University Stern School of Business, Herbert Rijken, Vrije University

Investment valuation: tools and techniques for determining the value of any asset / Aswath Damodaran, John Wiley, c2002.

Aswath Damodaran, Professor of Finance at the Stern School of Business at New York University:  Spreadsheet Programs: http://people.stern.nyu.edu/adamodar/

Week 2 September 6 (Professor Merva)

In class discussion on sovereign bonds based on assigned discussion questions.

Students present their valuation models for discussion and review in preparation for their Equity Research Report

Week 3 September 13 (Professor Merva)

Assignment 1 Equity Research Reports due at the beginning of class.

Presentation of Equity Research Reports; Brief presentations of debt presentation (first run through)

Lecture on CFA Code of Ethics and Professional Conduct

Week 4 Tuesday September 20 (Professor Merva)

Assignment 2: Student Presentations on Sovereign Debt

In class test on the CFA Code of Ethics and Standards of Professional Conduct.

Friday September 23 (Professor Merva)

Information Cascades

 Classroom Games: Information Cascades by Lisa Anderson and Charles Holt, The Journal of Economic Perspectives, Vol. 10, No. 4 (Autumn, 1996)  http://www.jstor.org/stable/2138561

 Learning from the Behavior of Others: Conformity, Fads, and Informational Cascades by Sushil Bikhchandani and David Hirshleifer, The Journal of Economic Perspectives, Vol. 12, No. 3 (Summer, 1998) http://www.jstore.org/stable/2647037

Week 5 September 27 (Professor Merva)

Assignment 2 White Papers on Sovereign Debt due at the beginning of class. 

Seminar Discussion on Macroeconomics of Unbalanced Growth: The Anatomy of Urban Crisis Author(s): William J. Baumol Source: The American Economic Review, Vol. 57, No. 3 (Jun., 1967), pp. 415-426 Published by: American Economic Association – students should read the article in advance and be prepared to respond and contribute to discussion questions.

Week 6 October 4 (Professor Stoian)

 Microeconomics: Private information, adverse selection and market failure (based on Akerlof`s paper). George A. Akerlof, “The market for “lemons”: quality uncertainty and the market mechanism”, The Quarterly Journal of Economics 84, 488-500, 1970.

 Week 7 October 11 (Professor Stoian)

Microeconomics: education and labor market signaling:

M. Spence, “Job Market Signaling”, The Quarterly Journal of Economics 87, 355-374, 1973.

 Week 8 October 18 (Professor Stoian)

 Imperfect information and credit rationing (based on Stiglitz, and A. Weiss` paper). J. E. Stiglitz, and A. Weiss, “Credit rationing in markets with imperfect information”, The American Economic Review 71, 393-410, 1981.

 Week 9 October 25 (Professor Stoian)

Prospect Theory

Kahneman, D., and A. Tversky. 1979. "Prospect Theory: An Analysis of Decision Under Risk." Econometrica 47(2):263-292.

Week 10: NO CLASS

 Week 11:  November 8 (Professor Stoian)

 Compensation

Lazear, E., and S. Rosen. 1981. “Rank-Order Tournaments as Optimal Labor Contracts.” Journal of Political Economy 89(5):841–64.

 Week 12 November 15 (Professor Merva)

Wage Discrimination – Seminar Discussion on assigned questions.

Bayesian Bigot? Statistical Discrimination, Stereotypes, and Employer Decision Making Author(s): Devah Pager and Diana Karafin Source:  Annals of the American Academy of Political and Social Science, Vol. 621, The Moynihan Report Revisited: Lessons and Reflections after Four Decades (Jan., 2009), pp. 70-93 Published by:  in association with the Sage Publications, Inc. American Academy of Political and Social Science Stable URL:  http://www.jstor.org/stable/40375833 Accessed: 19-04-2015 10:11 UTC

Are Emily and Greg More Employable than Lakisha and Jamal? A Field Experiment on Labor Market Discrimination Author(s): Marianne Bertrand and Sendhil Mullainathan Source:   The American Economic Review, Vol. 94, No. 4 (Sep., 2004), pp. 991-1013 Published by:  American Economic Association Stable URL:  http://www.jstor.org/stable/3592802 Accessed: 19-04-2015 09:58 UTC

Male Female Wage Discrimination in Urban Labor Markets, Author: Ronald Oaxaca, International Economic Review, Volume 14, Issue 3, October 1973 (693-709)

Week 13 November 22 (Professor Merva)

Seminar Reading and Discussion

Collective Action and the Evolution of Social Norms, Author: Elinor Ostrom, Journal of Economic Perspectives, Volume 14, No. 3, Summer 2000 (137-158)

Week 14 November 29 (Professors Stoian and Merva)

Final Presentations of microeconomics research paper

Week 15 December Final Exam Date (Professors Stoian and Merva)

Microeconomic Research Papers due at the beginning of class.

Final Presentations of microeconomics research paper