Course Syllabus

Comparative Economics: Global Risk and European Responses

 

Semester & Location:	Fall 2021 - DIS Stockholm
Type & Credits:	Core Course - 3 credits
Core Course Study Tours:	Sweden & Athens
Major Disciplines:	Economics, Finance, and Political Science
Prerequisite:	One course in intermediate or advanced microeconomics at university level.
Faculty Member:	Steve Turner - vaxholmsteve@gmail.com Greger Wahlstedt - greger.wahlstedt@gmail.com Stylianos Papaioannou - stylianos@disstockholm.se
Program Director:	Susanne Goul Hovmand - sgh@dis.dk
Academic Coordinator:	academics@disstockholm.se
Time & Place:	Mondays and Thursdays 14.50-16.10, 1D-508

Course Description

The capitalist economic system has proven to be without any serious competition in its capacity to generate both astounding wealth and unprecedented individual freedom. But the creative destruction that drives capitalism also generates a wide range of social ills, including vast inequality, chronic insecurity, and massive environmental destruction.

In a democratic society, elected officials and policy makers therefore face a dual challenge.  How to maintain the dynamic qualities of capitalism – marked by technological innovation and unending economic growth – while at the same time limiting the many undesirable side-effects.

In an attempt to meet this challenge, policymakers have devised a wide array of tools that are designed to “manage the economy” by reshaping the incentives faced by firms and consumers. The policy outcomes have been mixed, at best. After an extended period of stable growth, modest unemployment, and low inflation, pundits were led to believe that cumulative advances in economic theory virtually guaranteed stable economic progress. But the global economic crisis of 2008 shattered that illusion and revealed systemic shortcomings in the policymakers’ toolkit.  

In this course, we focus on both the similarities and differences in how selected western European nations have sought to manage their economies through a combination of fiscal and monetary policies, including not least, the establishment of an extensive welfare state and the adoption of a common European currency. We focus, in particular, on Sweden, which managed the 2008 crisis remarkably well and Greece, which was plunged into a fierce and protracted economic contraction. Our overarching objective is to assess the strengths, weaknesses, and deficiencies in the different toolkits of economic policy makers.

Learning Objectives

By the end of this course, students are expected to understand:

• The complex relations between capitalist economics and democratic politics
• The theoretical foundations and practical applications of fiscal and monetary policy
• The structure and dynamics of the welfare state 
• The structure and performance of the Swedish economy
• The foundations and basic operation of the European Union and the European Monetary Union
• The roots of the 2008 Financial Crisis and the divergent policy responses to the crisis
• The genesis of crisis in the Greek economy and the EU policy response
• To further develop essential skills – in analytical thinking and in both oral and written presentation - that are vital not only in navigating academic studies, but in flourishing in the game of life.

Faculty

Greger Wahlstedt

MBA (Finance, Manchester Business School) and CEFA (Certified European Financial Analyst) from Stockholm School of Economics. Greger has been working for more than 30 years in the financial markets. He has a solid experience as head of large asset management units; 14 years as head of Handelsbanken's fixed income fund management and asset allocation, as well as heading the investment division at the Swedish central bank (Riksbanken) in charge of the management of the gold and foreign exchange reserves. Originally, an economist, but he has also worked as quant analyst as well as senior sales in structured derivatives and Private Banking at Handelsbanken. He is an appreciated teacher in economics, bond markets and interest rate products, among other things. Since 2010 he is a subconsultant to Finanskompetens and educates Investment advisors in finance, financial markets and portfolio theory for the SwedSec license. Examples of such employees who need that licence can be investment advisors, brokers, managers, analysts, compliance officers, risk managers and management. Greger has been a member of the Credit Market group in The Swedish Society of Financial Analysts (SFF) for 20 years. With DIS Stockholm since 2017.

 

Steve Turner

M.A. in Political Sociology, Harvard University.  Extensive teaching experience in comparative politics, multiculturalism, globalization, welfare state policy and positive psychology. Works as a Leadership Consultant, bringing the lessons from modern psychology and neuroscience to the world of business. Also an avid squash player and kayaker. With DIS since 2016.

 

Stylianos Papaioannou

Ph.D  in International Entrepreneurship, Uppsala University, 2020.  M.S. in  International Business Strategy, Linnaeus University, 2012, with double-awarded Thesis on Social Corporate Responsibility of Small and Medium Size Exporting firms. B.S. in Economic and Regional Development, Panteion University, 2010.  Associated Researcher of Uppsala University, granted with Johan & Jakob Stiftelse Research Grant, published research in peer-reviewed international scientific journals: Journal of International Marketing, International Marketing Review, Thunderbird International Business Review, International Marketing Review, and others. Co-author of Handbook on International Alliance and Network Research.  Stylianos' interests include theater, opera, space exploration, amateur astronomy, gardening, cooking, baking, and parenting. 

 

Readings

• Online Text:  The Core Team - The Economy
  • https://www.core-econ.org/the-economy/book/text/0-3-contents.html
• Blanchard, Olivier. (2019) "Public Debt and Low Interest Rates." American Economic Review, 109 (4): 1197-1229.
• Blyth, M. and Matthijs, M. (2017) "When Is It Rational to Learn the Wrong Lessons? Technocratic Authority, Social Learning and Euro Fragility
• Dahlgren, G. (2014) Why Public Health Service? International Journal of Health Services, Volume 44, Number 3. pages 507–524
• Feldstein, M. (2012) "The Failure of the Euro". Foreign Affairs, Volume 91, Number 1
• Friedman, B. (2007) "Capitalism, Economic Growth, and Democracy". Daedalus 136:3
• Furman, J. and Summers, L.  (27 January, 2019) "Who's Afraid of Budget Deficits?" Foreign Affairs
• Goodman, J. and Loveman, G.  (Nov – Dec 1991) “Does Privatization Serve the Public Interest?” Harvard Business Review
• Henrekson, M. and Wennström. J. (2018) “Post-Truth” Schooling and Marketized Education"  Working Paper 1228, Research Institute of Industrial Economics 
• Konjunkturinstitutet. 2020. "The Swedish Economy"
• Mallaby, S. (2020)  "The Age of Magic Money".  Foreign Affairs.  Volume 99. Number 4
• OECD. 2020. "Economic Surveys: Sweden"
• Roser, M.  "What is Economic Growth and Why is it so Important?"  Our World in Data.https://ourworldindata.org/what-is-economic-growth
• Schumacher, J. and Weder Di Mauro, B. (2015) "Greek Debt Sustainability and Official Crisis Lending" Brookings Papers on Economic Activity
• Stiglitz, J. Tucker, T. and Zucman, G. (January/February 2020) "The Starving State - Why Capitalism's Salvation Depends on Taxation"  Foreign Affairs Vol 99 Number 1.
•  Varoufakis, Y.  (2013)  "From Contagion to Incoherence"
• Additional readings TBA

Field Studies

For our first field study, we will meet with a well known Swedish economist to discuss the current state of the economy. For our second field study, we will visit a "private"  Swedish high school to experience a key element of the modern Swedish welfare state. 

Study Tours

- The short study tour takes us to the northern coastal city of Sundsvall, which served historically as the hub for the Swedish timber and paper industries. The focus for our tour is to examine how local government and companies are working to meet ambitious environmental objectives.

- The long study tour takes us to Athens, where we will have an opportunity to carry out an in-depth examination of the genesis and key features of the ongoing Greek economic crisis and the policy initiatives that have been employed to reverse long term economic stagnation.  

Approach to Teaching

Our approach to teaching is based on a core assumption: Learning is a collective endeavour in which the contribution of each individual has an impact on how much is learned overall. Lectures can serve a valuable purpose both in providing useful information and in stimulating creative thought. But genuine learning takes place only when the student takes an active role –in reading carefully, thinking critically, in raising questions and objections, and in listening to others. It is only through engaged dialogue that we have the capacity to enrich our understanding of the world. Our expectation is that students will actively engage in the learning process, both inside and outside the classroom.   

The course utilizes a variety of pedagogical methods, including lectures, discussions, student presentations, and study visits. There is a strong emphasis on discussion and student participation. Everyone is expected to not only complete the readings for each class, but to come to class well prepared to engage in discussion.

Attendance at all lectures and field studies is mandatory. If you are unable to attend class, it is your responsibility to contact your teacher and take responsibility for anything you have missed.

Note that it is important to check your e-mail and DIS Canvas regularly since outlines, exam info etc. will be distributed here.

Expectations of the Students

Students are expected to have done the readings and come prepared with relevant questions and notes for each class. This will give us material to generate conversation. When responding to questions in class, make reference to the readings to support the points you are making. Students are expected to challenge themselves and their worldviews with an open mindset and genuine intellectual curiosity. 

Note on COVID-19:

We all have a collective responsibility to avoid the spread of COVID-19 at DIS. Throughout this semester, please monitor yourself carefully for symptoms of COVID-19 (dry cough, high temperature, breathing difficulties, sore throat, headache, muscle pain, loss of smell/taste). If you experience any of these symptoms, please stay home and contact the DIS emergency phone. The respondent will coordinate with Academics at DIS Stockholm, who will in turn contact your individual faculty. If you are otherwise well but isolating due to possible exposure or mild symptoms, it is your responsibility to keep up with your coursework - we will organize hybrid classes for you to join via Zoom. If you are unwell due to COVID-19 and unable to attend class or study, your absence will be excused. Your faculty will work with you to ensure you are able to make up missed course content due to illness. You are still responsible for completing any missed work. 

 

Grading

Assignment	Percent
Attendance/Class Participation	20%
Pre-Class Quizzes	30%
Midterm Take Home Examination	20%
Presentation: Lessons from Greece	10%
Final Take-home Examinaton	20%

 

Attendance/Class Participation (20%):

Your participation grade reflects the importance of being active in this course, which relies in great part on the reflections, discussions, and exercises in class.

Attending class earns a grade of 80; Raising questions and engaging in discussions earns additional points

Pre-class Prep (30%):

Prior to many class sessions, you will complete a short Canvas quiz based on the readings and concepts addressed in class. 

Mid-term Take Home Exam (20%)

There will be a take-home exam covering the theories and concepts that have been discussed so far in the course.

Presentation: Lessons from Greece. (10%)

Final Take-home Exam (20%)

Note on Use of Electronic Devices in the Classroom

An extensive body of research has shown that the use of laptops in the classroom leads to sub-optimal learning outcomes.  For this reason, computers will only occasionally be used. The use of other electronic devices such as mobile phones is prohibited. 

Academic Regulations  

Please make sure to read the Academic Regulations on the DIS website. There you will find regulations on: 

• Course Enrollment and Grading  
• Academic Expectations and Honor Code 

 

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