FIN30260 History of Financial Crises

Academic Year 2019/2020

This module provides a detailed historical account of financial crises. Finance has a long history, with some forms of financial contracts dating back 7,000 years. The module tracks the development of financial markets and the associated financial crises over a relatively shorter time span, from the early 17th century. The events of 2007/08 have led to considerable economic and financial upheaval. A regular question is whether the 2007/08 crisis was different? We will answer this question, but only after evaluating the most significant financial crises over the last 400 years, starting with the tulipmania of 1636. Within each crisis, we will examine the causes and in particular the common elements associated with each crisis. For each case we examine the implications and in particular the implications for modern global financial markets.

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Curricular information is subject to change

What will I learn?

Learning Outcomes:

1. Have a comprehensive appreciation of the key issues that shape modern finance.
2. Understand the common causes of historical financial crises.
3. Demonstrate a knowledge of the common precursors associated with financial crises.
4. Be able to explain in detail a likely time line of events in relation to a likely financial crisis.
5. Have an appreciation of the role of economic policy and regulation in relation to a financial crisis.
6. Recognise the cultural implications.

Indicative Module Content:

Introduction
The Anatomy of Financial Crises
History of Financial Innovation
Bubbles: The Economics
Bubbles: The Manias
Modern Banking Crises
The 1929 Crash
2008 Financial Crisis. This Time it's Different?

How will I learn?

Student Effort Type	Hours
Lectures	24
Autonomous Student Learning	100
Total	124

Am I eligible to take this module?

Requirements, Exclusions and Recommendations

Learning Requirements:

FIN20010 Principles of Finance
or
FIN10670 Introduction to Finance

and

Principles of Macroeconomics (ECON10020) or equivalent introductory level economics module.

Module Requisites and Incompatibles

Incompatibles:
ECON30380 - Economics of Financial Crisis

How will I be assessed?

Assessment Strategy

Description	Timing	Open Book Exam	Component Scale	Must Pass Component	% of Final Grade
Continuous Assessment: Weekly Class Quiz	Varies over the Trimester	n/a	Other	No	10
Presentation: Article Review Project Presentation	Week 12	n/a	Graded	No	10
Project: Article Review Project	Varies over the Trimester	n/a	Graded	No	10
Examination: Closed Book Winter Exam	2 hour End of Trimester Exam	No	Graded	No	70

Carry forward of passed components
Yes

What happens if I fail?

Resit In	Terminal Exam
Spring	Yes - 2 Hour

Assessment feedback

Feedback Strategy/Strategies

• Group/class feedback, post-assessment

How will my Feedback be Delivered?

Not yet recorded.

Reading List

R.Z. Aliber and C.P. Kindleberger (2015), Manias, Panics and Crashes: A History of Financial Crises, 7th Edition, Palgrave.

Peter M. Garber (2001), Famous First Bubbles: The Fundamentals of Early Manias, MIT press.

Larry Neal (2015), A Concise History of International Finance: From Babylon to Bernanke, Cambridge University Press.

David Chambers and Elroy Dimson (Eds.) (2016), Financial Market History: Reflections on the Past for Investors Today, CFA Institute.

Carmen Reinhart and Kenneth Rogoff (2009), This Time is Different, Princeton University Press.

Helen Paul (2011), The South Sea Bubble, Routledge.

Niall Ferguson (2009), The Ascent of Money, Penguin.

Robert Shiller (2016), Irrational Exuberance, 4 Edition, Princeton.

Keith Cuthbertson and Dirk Nitzsche (2004), Quantitative Financial Economics, Wiley.

Frederic Mishkin (2016), Economics of Money, Banking and Financial Markets, Global Edition, 11th edition, Pearson.