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EVGENIA PASSARI - Assistant Professor, Université Paris - Dauphine

Course objectives

The aim of this module is to provide a thorough foundation of the key concepts in international finance with a focus on exchange rate economics. The module begins with an overview of the institutional characteristics of the foreign exchange market and subsequently examines the fundamental determinants of exchange-rate dynamics. By the end of the course, the students will be familiar with both the theoretical models and the empirical evidence regarding exchange-rate behavior. Emphasis will be given to the implications of these outcomes for exchange rate forecasting, international diversification, and investment decisions

Course outline

WEEK 1: FX Market Structure

WEEKS 2 & 3: FXMarket Efficiency

WEEKS 4 & 5: Real Exchange Rate and Purchasing Power Parity

WEEK 6: Balance of Payments

WEEKS 7 & 8: Exchange RateDetermination


Bekaert, G. and R.J. Hodrick(2009). International Financial Management. New Jersey: Pearson Education.

Sarno, L. and M.P. Taylor, (2005), The Economics of Exchange Rates, CambridgeUniversity Press


Final Exam