Syllabus

A list of topics by session is given in the calendar below.

Course Meeting Times

Lectures: 2 sessions / week, 1.5 hours / session

Description

This course gives a historical perspective on financial panics. Topics include the growth of the industrial world, the Great Depression and surrounding events, and more recent topics such as the first oil crisis, Japanese stagnation, and conditions following the financial crisis of 2008.

If you want to keep up with financial developments as they happen, take 14.05 Intermediate Applied Microeconomics or read Paul Krugman in The New York Times.

Prerequisites

The prerequisites for this course are 14.01 Principles of Microeconomics and 14.02 Principles of Macroeconomics.

Textbooks

We will read most to all of these books:

Buy at Amazon Koo, Richard C. The Holy Grail of Macroeconomics: Lessons from Japan's Great Recession. Rev. ed. New York, NY: Norton, 2009. ISBN: 9780470824948.

Buy at Amazon Morris, Charles R. The Two Trillion Dollar Meltdown: Easy Money, High Rollers, and the Great Credit Crash. New York, NY: Public Affairs, 2009. ISBN: 9781586486914.

Buy at Amazon Taylor, John B. Getting off Track: How Government Actions and Interventions Caused, Prolonged, and Worsened the Financial Crisis. Stanford, CA: Hoover Institution Press, 2009. ISBN: 9780817949716.

Buy at MIT Press Buy at Amazon Temin, Peter. Lessons from the Great Depression. Cambridge, MA: MIT Press, 1991. ISBN: 9780262700443.

Selected chapters will be chosen from these books:

Buy at Amazon Bartels, Larry M. Unequal Democracy: The Political Economy of the New Gilded Age. Princeton, NJ: Princeton University Press, 2008. ISBN: 9780691136639.

Buy at Amazon Crafts, Nicholas, and Gianni Toniolo. Economic Growth in Europe since 1945. New York, NY: Cambridge University Press, 1996. ISBN: 9780521499644.

Buy at Amazon Goldin, Claudia, and Lawrence F. Katz. The Race between Education and Technology. Cambridge, MA: Harvard University Press, 2008. ISBN: 9780674028678.

Buy at Amazon Kindleberger, Charles P., and Jean-Pierre Laffargue. Financial Crises: Theory, History, and Policy. New York, NY: Cambridge University Press, 1982. ISBN: 9780521243803.

Course Requirements

You will be expected to complete three problem sets, to read the required material before class, and to participate actively in class discussion.

Grading

ACTIVITIES PERCENTAGES
Problem set 1 30%
Problem set 2 30%
Problem set 3 40%

Calendar

SES # TOPICS KEY DATES
Part I: Growth, wars, and the great depression
1 Introduction  
2-3 Crises and industrialization  
4-5 Early modern crises  
6-7 World War I and depression  
8-9 Recovery and World War II Problem set 1 due in Ses #9
Part II: Post-war stability and crises
10-11 The Golden Age  
12-13 Income inequality  
14-15 Oil crises of the 1970s  
16-17 Japanese growth and stagnation Problem set 2 due in Ses #17
Part III: Recent crises
18-19 Small crises and imbalance  
20-21 2008  
22-23 2009 Problem set 3 due in Ses #23