Angewandte Wirtschaftsforschung 4: Advanced Topics in Empirical Macroeconomics: Systemic Risk and Shadow Banking
Shadow banking, in particular securitization of US subprime mortgage loans, has played a crucial role in the creation of the Great Financial Crisis. At this time, financial market participants, blinded by supposedly good credit ratings, neglected essential parts of risk that arose from non-traditional banking \citep{Gennaioli2012}. This relates to the question about an optimal degree of diversification, as diversification can decrease the idiosyncratic risk for a single entity, but increase the (underestimated) systemic risk through stronger connectivity \citep{Wagner2010}. The objective of this seminar is to give information about systemic risks and shadow banking. Students will learn these concepts with the aide of a reference paper. In a first part of their seminar paper, they should reflect the essential statements in the reference paper in their own words, present its contributions to the literature and identify strengths and weaknesses in the methodology applied. In a second part of the paper, students will compare the dynamics described in the reference paper with recent empirical findings of an economy of their choice. As a basis for the latter can serve financial market stability reports from central banks. After successful completion of the course, students should be able to approach the related academic literature as well as current policy debates.
Shadow banking, in particular securitization of US subprime mortgage loans, has played a crucial role in the creation of the Great Financial Crisis. At this time, financial market participants, blinded by supposedly good credit ratings, neglected essential parts of risk that arose from non-traditional banking \citep{Gennaioli2012}. This relates to the question about an optimal degree of diversification, as diversification can decrease the idiosyncratic risk for a single entity, but increase the (underestimated) systemic risk through stronger connectivity \citep{Wagner2010}. The objective of this seminar is to give information about systemic risks and shadow banking. Students will learn these concepts with the aide of a reference paper. In a first part of their seminar paper, they should reflect the essential statements in the reference paper in their own words, present its contributions to the literature and identify strengths and weaknesses in the methodology applied. In a second part of the paper, students will compare the dynamics described in the reference paper with recent empirical findings of an economy of their choice. As a basis for the latter can serve financial market stability reports from central banks. After successful completion of the course, students should be able to approach the related academic literature as well as current policy debates.
- Moderator/in: Thomas Theobald
Semester: 2019/20 Wintersemester
Angewandte VWL: Übung zu Growth, Development and Sustainability
- Moderator/in: Juan Carlos Peña
Semester: 2019/20 Wintersemester
(V) Angewandte VWL: Growth, Development and Sustainability
Why do some countries or regions reach very high levels of per capita incomewhile others stay miserably poor? Why did per capita income in todays’ richcountries remain low for thousands of years before starting an impressive growthspurt around the Industrial Revolution? Not least due to intensive research in thelast decades we continue to learn more on these issues as well as on the crucialquestions, which policy choices are relevant for a dynamic process of economicdevelopment, and which policies may lead to a sustainable development path.
The course is intended to give students an introduction into theories
and stylized facts of long-term economic growth and sustainability.
Models of various schools of economic thought will be discussed and
compared to each other. The relation of growth, environmental issues and
inequality will be explored. After successful completion of the course,
students should be able to approach the related academic literature as
well as current policy debates. Knowledge of basic concepts of
macroeconomics and microeconomics is required. Students should have
completed the respective introductory courses.
- Moderator/in: Sebastian Gechert
Semester: 2019/20 Wintersemester