Systemic Risk Modeling

During the past several years (2008-2013) the world has experienced one of the most devastating financial crises. Along with the crisis came significant volatility of the global financial markets, business closures, layoffs of thousands of highly educated and qualified employees across disciplines, and substantial loss in productivity and economic output. The FED kept the interest rates to virtually zero level where they will probably stay for unforeseeable time period until the economic growth convincingly changes course.
Referring to the evidence well reported in the scientific literature, you need to prepare analysis of the world’s financial system evaluating the factors that contributed to the current situation, and offering solutions to the crisis.
You need to write a scientific paper offering a model for global systemic risk organized as follows:
Title, Author (and your affiliation), Keywords, Abstract, Introduction, Several easily identified, labeled sections based on your research, Data Analysis (source required), graphic representation of the data (figures and tables), Analysis of the Results, Discussion, References (extremely important – need to be inserted in the paper where appropriate, and listed at the end of the paper), supplementary material.
In your paper you are required to:
1. Describe the problem to be solved or questions to be answered
2. Explain the concepts needed to understand this problem
3. Pull in and cite existing research having direct relation to your study (at least 15-20 citations need to be included in your paper)
4. Offer explanations of significant reason(s) for the latest financial crisis
5. Describe the effect of the crisis on many faucets of the society
6. Analyze important data for the last 20 years (1994 – 2013) such as relevant macroeconomic indicators (GDP growth, GDP as a percentage of Sovereign Debt, exports, imports, inflation, interest rates, etc.) for different countries, financial market data for these countries (major stock indices), currency trends, etc. (you need to comparatively analyze at least 3 countries)
7. Represent the analyzed data graphically, organize them in tables and plots and offer your own interpretation of the results
8. Perform statistical analysis of the data to show dependencies and/or causalities among different macroeconomic indicators. Use regression analysis with GDP growth as dependent variable and GDP as a percentage of Sovereign Debt, exports, imports, inflation, interest rates as independent variables to test the explanatory power and statistical significance of the independent variables for GDP growth.
The papers should not exceed 15 pages, double spaced.
The paper is to be prepared using the APA writing style and guideline for references format. They must contain a bibliography and all direct quotations and data sources must be properly cited. . The Department uses the APA style as it lends itself well to both reading the paper and understanding references without being cumbersome as some of the other styles are (such as Chicago or MLA). Students can download the student style guide from the American Psychological Association http://www.apastyle.org/elecref.html) web site or you can purchase the APA style guide from the book store. There is even a help disk that can be purchased for about $ 40 (http://www.apa.org/software/ ) that will work the student through the process as you write you paper if you desire a more “personal assistance”.
Papers are to be RESEARCH PAPERS. Remember that work that you use from other authors MUST be referenced. Since it is assumed that you are not an authority on the topic that you are writing on it is expected that this paper is an overview of many different sources of information.