Integrating Financial Crises into the Finance or Economics Curriculum

Abstract

Economic and finance courses tend to rely upon rational expectation models. These models do not explain excessive speculation and subsequent financial crashes, yet these crises shape our financial institutions. In order to address this gap in the curriculum, I integrate the study of financial crises into a Financial Markets and Institutions class. Specifically, I identify 10 books related to money and financial crises that are thematically related, but which differ by historical period and economic perspective. I assign each student a book to read and define a set of deliverables that are spaced out over the semester. These deliverables include a book review, thesis statement, article/literature review, chart or figure, draft paper, and final paper, and culminate in a final presentation to the class. The project serves several purposes. First, the students improve their writing and presentation skills. Second, the students gain an appreciation for the historical context of different financial crises. Lastly, the students develop critical thinking skills.

Keywords: Financial Crisis, Financial Institutions, Financial Markets, Financial Instability, Pedagogy, Manias, Panics

JEL Classification: A20, E44, G01, G20, N00