MONEY AND BANKING

Credit Hours: 3 · Undergraduate Upper-Level

Micro-foundations of monetary, fiscal and financial theory. Examines the unique roles of money and of banking in providing the transactions mechanism and in the functioning of financial markets. Explains the use of valued fiat, unbacked money which appears to violate basic microeconomics, in the context of Samuelson's overlapping generations model, including the implications for monetary and fiscal policy and for inflation. Discusses bank runs and financial instability.