Economics

The following modules are available to incoming Study Abroad students interested in Economics.

Alternatively you may return to the complete list of Study Abroad Subject Areas.

ECON207: Managerial Economics

  • Terms Taught: Michaelmas term
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites: Introductory Micro and Macroeconomics.

Course Description

This course covers aspects of microeconomics of relevance to general management. Industrial behaviour and study of the business environment are stressed throughout. Techniques and tools of applied analysis are emphasised alongside the relevant theory.

Educational Aims

This course is designed to introduce students to those aspects of the firm and its environment which are of particular relevance to management. The topics selected aim to bridge the gap between the traditional approach to managerial economics and the more modern study of the organization.  By the end of the module students should have the ability to understand, interpret and extend both traditional and modern approaches to the theory of the firm.

Outline Syllabus

Indicative content:

CONSUMER BEHAVIOUR

  • Preferences.
  • Indifference curves and the budget constraint.
  • Comparative statics of changes in income and price.
  • Income and substitution effects.

PRODUCTION  COSTS

  • Short and long-run decisions
  • Measuring productivity.
  • The production function.
  • Isoquants and isocost lines.
  • Short and long run costs.
  • Economies of scale and scope.

MONOPOLY

  • Sources of monopoly power.
  • Pricing under monopoly.
  • Multi-plant monopoly.
  • Entry barriers.
  • Deadweight loss.

MONOPOLISTIC COMPETITION  ADVERTISING

  • Conditions for monopolistic competition.
  • Profit maximization and long-run equilibrium.
  • Product differentiation.
  • Advertising.

OLIGOPOLY

  • Strategic interaction.
  • The kinked demand curve.
  • Sweezy, Cournot, Stackelberg and Bertrand models of oligopoly.
  • Commitment and incentives to cheat.
  • Contestable markets.

GAME THEORY

  • Definitions
  • Dominant Strategy Equilibrium  Prisoners Dilemma
  • Backwards Induction
  • Nash Equilibrium
  • Subgame Perfect Nash-Equilibrium
  • Mixed Strategies

INFORMATION ECONOMICS (2 lectures)

  • Asymmetric/Incomplete Information
  • Adverse Selection
  • Moral Hazard
  • Signalling,
  • Screening.

AUCTIONS

  • Major types of Auction
  • Optimal Bidding Strategy
  • Expected Revenues

BUSINESS STRATEGY

  • Limit pricing
  • Predatory pricing
  • Raising rivals costs
  • Network effects

EXTERNALITIES, PUBLIC GOODS AND RENT SEEKING

  • Externalities
  • Public goods
  • Incomplete information
  • Rent seeking
  • Government policy and international markets

Assessment Proportions

  • Coursework: 40%
  • Exam: 60%

ECON208: Business and International Macroeconomics

  • Terms Taught: Lent / Summer Terms only.  
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS credits
  • Pre-requisites: Introductory Micro and Macroeconomics.

Course Description

This course covers aspects of macroeconomics, which are of relevance to general management, with particular emphasis on the financial sector and the effects of fiscal and monetary policy. It seeks to explain the implications of macroeconomic policy changes for the international business environment.

Educational Aims

Business activities are affected by national economic policies through their influence on inflation, interest rates, exchange rates and aggregate demand. This course examines the main channels of influence from the international business perspective.

The object of the course is therefore to develop an understanding of the workings of macroeconomic policy and to familiarise participants with the interpretation of macroeconomic and monetary data. Students are encouraged to use their knowledge of macroeconomic theory to gain a better understanding of current macroeconomic events and issues. Weekly classes will consolidate the understanding and interpretation of macroeconomic data.

Outline Syllabus

Indicative content:

  • National accounting and the macroeconomic balances. International financial flows, Asian saving, Western consumption and the global credit crisis.
  • Productivity and the sources of economic growth in the long run.
  • Equilibrium in the goods and money markets.
  • Aggregate demand and aggregate supply.
  • Unemployment, inflation and monetary policy.
  • The balance of payments and exchange rates. The IS-LM-BP model.
  • The IS-LM-BP model.
  • Time and aggregate demand. Policy implications of optimisation in consumption and business investment decisions.
  • The governments budget constraint and public debt accumulation with emphasis on the world credit crisis. When are fiscal deficits justified?
  • Transmission mechanisms of monetary policy. Inflation targeting, asset markets and the yield curve. Crisis management and unconventional monetary measures.

Assessment Proportions

  • Coursework: 40%
  • Exam: 60%

ECON212: Introduction to Econometrics

  • Terms Taught: Lent / Summer Terms only.  
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites: Introductory statistics.

Course Description

This course provides an introduction to the fundamental theoretical concepts and applications of econometrics. Econometric techniques taught in the course include bivariate regression, multiple regression and two stage least squares. The importance and relevance of statistical and diagnostic testing is emphasised in the context of econometrics applications. You will learn the statistical package SPSS, the understanding of which is an integral part of the course.

Educational Aims

This half unit course aims to provide an introduction to the fundamental theoretical concepts and applications of econometrics.  On successful completion of this course the student should carry the following transferable skills:

  • computer literacy (the use of computer, Word, SPSS and internet),
  • data manipulation and analysis,
  • analytical skills,
  • problem solving,
  • planning,
  • independent thinking.

Outline Syllabus

Indicative content:

  • Introduction to regression analysis: Simple linear   regression; multiple regression; least squares estimation; explanatory power.
  • Least squares assumptions; Gauss-Markov Theorem;   Hypotheses testing: t-test, p-value, confidence interval
  • Hypotheses testing: F test; Multicollinearity.       
  • Introduction to time series analysis. LMSC test; Granger Causality; Dickey-Fuller Test; Cointegration.       
  • Specification, omitted and irrelevant variables, Ramsey's RESET test, Akaike Information Criterion, Schwarz Criterion, Jarque-Bera test     
  • Specification, choosing a functional form, log forms, dummy variables     
  • Consequences of Serial Correlation, Durbin Watson test,  Remedies for Serial Correlation
  • Consequences of Heteroscedastic errors; White test; Remedies for Heteroscedasticity  
  • Simultaneous equation models; structural and reduced-form   equations; identification; two stage least squares 

Assessment Proportions

  • Coursework: 40%
  • Exam: 60%

ECON220: Intermediate Microeconomics I

  • Terms Taught: Michaelmas Term only.
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites:
    • Introductory Microeconomics and Mathematics. 
    • NB This course cannot be taken with ECON 207.

Course Description

This course introduces you to the fundamental theoretical tools required to study microeconomics. The course requires algebra, elementary calculus, logical thinking and problem-solving ability. Topics include consumer choice, theory of demand, production and cost functions and analysis of competitive markets.

Educational Aims

By the end of this course, students should have a knowledge and understanding of:

  • Analytical methods, both theory and model based
  • The relevance of different theoretical approaches to public policy and business problems

Outline Syllabus

  • Theory of Demand: The axioms of choice and rational behaviour; the concept of a utility function; the relationship between utility and preference; the preference map and the indifference curve; income and substitution effects; derivation of demand from the indifference curve; revealed preference. 
  • Risk and Uncertainty: Expected utility; risk aversion; adverse selection and moral hazard; the market for lemons; the demand for insurance.
  • Theory of Production and the Demand for Factors of Production: the short and long run production function; total, marginal and average concepts; output elasticity; concepts of marginal revenue product and the link with the demand for factors of production; demand for factors under perfect and imperfect competition.
  • Cost Theory: Derivation of cost curves from short and long run production functions; the relationship between output and cost elasticity; the implications of returns to scale for the firm's cost curves; the supply curve of the firm.

  • Introduction to market structure: The short run and long run; Perfect Competition; Monopoly; introduction to Oligopoly

  • Information economics: Asymmetric Information; Adverse Selection; Signalling; Screening; Pooling and Separating Equilibria; Principal-Agent problem; Moral Hazard

Assessment Proportions

  • Coursework: 40%
  • Exam: 60%

ECON221: Intermediate Microeconomics II

  • Terms Taught: Lent / Summer Terms only.
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites:
    • ECON 220 or equivalent.
    • NB: this course cannot be taken with ECON 207.

Course Description

This course is the natural successor to ECON 220 and continues the development of intermediate microeconomic analysis. Topics include analysis of monopoly behaviour and regulation, price and quantity setting in duopoly markets, introduction to game theory and strategic behaviour by firms, auctions (including a study of eBay) and general equilibrium and welfare economics. This course is normally taken in conjunction with ECON 220.

Educational Aims

This course is designed to extend the knowledge of the principles of microeconomics which students acquired in their first year. Although the main focus of the course is on microeconomic theory, this is taught within the context of applications and policy analysis.

Outline Syllabus

Indicative content:

  • Inter-temporal Consumption and Production.  Preferences and the budget constraint; inflation and present value.
  • Game Theory and Oligopoly: noncooperative oligopoly; Cournot, Bertrand and Stackelberg; normal and extensive form games; dominated strategies; Nash equilibrium and applications.
  • Game Theory and Oligopoly: cooperative oligopoly; cartels and tacit collusion; stability.
  • Introduction to welfare economics: general equilibrium theory and resource allocation;  the Edgeworth Box; Pareto efficiency; aggregation of preferences; social welfare functions
  • Market failures: social and private costs; social and private benefits; externalities, public goods and welfare maximisation.
  • Natural monopoly; consumer surplus; producer surplus; price discrimination; regulation

Assessment Proportions

  • Coursework: 40%
  • Exam: 60%

ECON222a: Intermediate Macroeconomics I

  • Terms Taught: Michaelmas Term only.
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites:
    • Introductory Macroeconomics and Mathematics.
    • NB: this course cannot be taken with ECON 208.

Course Description

This course is designed to extend the knowledge of the principles of macroeconomics which students acquired in their first year. Although the main focus of the course is on macroeconomic theory, this is taught within the context of current events in the international macroeconomic environment. Considerable emphasis is placed on the use of analytical tools for gaining a better understanding of the workings of the macro-economy and the ways in which policy makers respond to macroeconomic problems. Students are encouraged to use their knowledge of macroeconomic theory to gain a better understanding of current macroeconomic events and issues. Note that some of the topics covered in the course require basic knowledge of calculus and algebra.

Educational Aims

By the end of this course, students should have a knowledge and understanding of:

  • Analytical methods, both theory and model based
  • The relevance of different theoretical approaches to public policy and business problems
  • The international economic environment in the UK and the impact of external factors on macro economic performance and policy with particular reference to the UK economy 

Outline Syllabus

Indicative Content

  • The economy in the long run: the classical model of the macro-economy
  • The macro-economy in the short run. Flexible wages and prices, and the Aggregate demand/Aggregate Supply
  • The budget constraint and the effectiveness of macro-policy
  • Monetary policy with special reference to the UK
  • The Open Economy. Theories of exchange rate determination

Assessment Proportions

  • Coursework: 40%
  • Exam: 60%

ECON222b: Intermediate Macroeconomics I

  • Terms Taught: Lent / Summer Terms only.
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites:
    • Introductory Macroeconomics and Mathematics.
    • NB: this course cannot be taken with ECON 208.

Course Description

This course is designed to extend the knowledge of the principles of macroeconomics. Although the main focus of the course is on macroeconomic theory, this is taught within the context of current events in the international macroeconomic environment. You are encouraged to use your knowledge of macroeconomic theory to gain a better understanding of current macroeconomic events and issues. Topics include: classical and Keynesian views; the role of money; real balance and wealth effects; the government budget constraint; monetary policy in the UK; models of exchange rate determination.

Educational Aims

By the end of this course, students should have a knowledge and understanding of:

  • Analytical methods, both theory and model based
  • The relevance of different theoretical approaches to public policy and business problems
  • The international economic environment in the UK and the impact of external factors on macro economic performance and policy with particular reference to the UK economy 

Outline Syllabus

Indicative Content

  • The economy in the long run: the classical model of the macro-economy
  • The macro-economy in the short run. Flexible wages and prices, and the Aggregate demand/Aggregate Supply
  • Monetary policy with special reference to the UK
  • The budget constraint and the effectiveness of macro-policy
  • The Open Economy. Theories of exchange rate determination

Assessment Proportions

  • Coursework: 40%
  • Exam: 60%

ECON223: Intermediate Macroeconomics II

  • Terms Taught: Lent / Summer Terms only.
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites:
    • Prerequisites: ECON 222A/B or equivalent.
    • NB: this course cannot be taken with ECON 208.

Course Description

This course emphasises the application of macroeconomic theory to current policy issues. Considerable emphasis is placed on the use of analytical tools for gaining a better understanding of the workings of the macro-economy and the ways in which policy makers respond to macroeconomic problems. Topics include: unemployment and inflation; adaptive and rational expectations; policy effectiveness under rational expectations; the economics of independent central bank; growth theory. This course is normally taken in conjunction with ECON 222.

Educational Aims

By the end of this course, students should have a knowledge and understanding of:

  • Analytical methods, both theory and model based.
  • The relevance of different theoretical approaches to public policy and business problems.
  • The international economic environment in the UK and the impact of external factors on macro economic performance and policy with particular reference to the UK economy. 

Outline Syllabus

Indicative content

  • Expectation Formation and Unemployment and Inflation. The Phillips curve
  • An Introduction to dynamic Analysis: Solving First and Second Order linear. Difference Equations.
  • The Economics of Independent Central Banks.
  • The economy in the long run: the neoclassical theory of economic growth and endogenous growth theory

Assessment Proportions

  • Coursework: 40%
  • Exam: 60%

ECON224: Introduction to Economics for Managers

  • Terms Taught: Michaelmas Term only.
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites:
    • high school mathematics.
    • NB: this course is only available to students with no prior background in Economics.

Course Description

The course introduces microeconomic issues relating to markets and firms, and macroeconomic issues relating to money, banking and monetary policy.

Educational Aims

  • Course objectives: To provide an introduction to the analysis of economic issues from a business perspective, primarily for business major students. The course demonstrates the relevance of economic concepts and principles to business issues through teaching and application of introductory economic theory to a range of issues affecting economic aspects of the business environment.
  • Key skills: To provide appropriate theoretical and analytical tools to facilitate a broad understanding of Microeconomics, with particular emphasis on interpreting the economic behaviour of individuals and firms.

Outline Syllabus

Indicative Content

  • Introduction to Microeconomics - Specialisation & Exchange. 
  • Markets: Demand & Supply Curves.
  • Markets: Demand & Supply Elasticities.
  • The Theory of the Firm: Production.
  • The Theory of the Firm: Costs, Revenue & Profit.
  • Market Structure & Competition: Perfect & Imperfect Competition. (monopolistic) competition.
  • Market Structure & Competition: Monopoly & Oligopoly. 
  • Externalities & Public Goods. 
  • Governments & Control.
  • The Market for Labour.

Assessment Proportions

  • Coursework: 33%
  • Exam: 67%

ECON225: Further Topics in Economics for Managers

  • Terms Taught: Lent / Summer Terms only.  
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites:
    • ECON 224 or equivalent.
    • NB: this course is only available to students with no prior background in Economics other than ECON 224.

Course Description

The course further develops microeconomic issues relating to monopolies, public goods and strategic decision-making; and macroeconomic issues relating to employment, inflation, exchange rates and aggregate demand management.

Educational Aims

By the end of this course students will be able to use appropriate theoretical and analytical tools to aid understanding of economic problems and issues.

Outline Syllabus

  • The Money Economy and the State
  • Money and Banking
  • PSB, the National Debt and the value of Sterling
  • Interest Rate Determination
  • Money and Inflation: Phillips curves
  • Money and Inflation: Monetarism
  • Monetary Policy
  • The Balance of Payments and Currency Exchange Rates
  • Investment and Capital
  • Inter-temporal prices

Assessment Proportions

  • Coursework: 33%
  • Exam: 67%

ECON228: Game Theory

  • Terms Taught: Michaelmas Term only.
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites: Introductory Economics.

Course Description

Economic problems are modelled and analysed using game theory. This course aims to provide students with the knowledge, understanding and skills required to set up and  solve models as a means of analysing economic problems.

Educational Aims

On successful completion of this module, students should have a knowledge and understanding of how to:

  • model different games
  • apply game theoretic solution concepts to find appropriate predictions in games
  • address economic problems using relevant techniques
  • apply game theory methods to analyse the behaviour of economic agents and the interactions within the economic system
  • interpret the results of the modelling process in the context of economic problems

Outline Syllabus

  • Overview and Introduction to Game Theory
  • Basic Models (Simultaneously played games)
  • Basic Models (Sequentially played games)  
  • Pure Strategy Nash Equilibrium
  • Mixed Strategy Nash Equilibrium
  • Refinements (Trembling hand perfect equilibrium, Rollback equilibrium)
  • Repeated Games
  • Bayesian games and simple applications
  • Correlation
  • Introduction to Bargaining and Auctions

Assessment Proportions

  • Coursework: 33%
  • Exam: 67%

ECON229: Applied Economics

  • Terms Taught: Michaelmas Term only
  • US Credits: 4 Semester Credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites: Introductory Economics.

Course Description

The course aims at enhancing the ability for logical and structured problem analysis, the ability to present clearly technical subjects, and their ability to assess real-life economic issues relating to their studies. Topics include poverty and inequality, the economics of crime and the financial crisis.

Educational Aims

On successful completion of this module students will be able to apply basic economic theory and statistical techniques to issues in applied economics.

Outline Syllabus

  • The Economics of Food Security: Is there a world food shortage or is there a distribution problem? How can production increase to meet the rising demand for food (and water). What changes can occur on the supply side and what are the impediments to doing so; food security and conflict.
  • Economics of Crime: Standard micro models of crime as rational choice. The effect of deterrence and policing on crime, economic conditions and crime; The great crime moderation;  Cyber crime.
  • The Transatlantic Financial Crisis  Causes, Consequences and the Future of Macroeconomics: What caused the GFC; what was the effect; the great recession; is this different from previous downturns; should economists have predicted it?
  • Poverty and Inequality: Theory, measurement and causes  skill-biased technological change, etc. Policy implications? Should we care about inequality?

Assessment Proportions

  • Coursework: 33%
  • Exam: 67%

ECON230: Economic Policy

  • Terms Taught: Lent / Summer Terms only.
  • US Credits: 4 Semester Credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites: Introductory Economics.

Course Description

The purpose of this course is to provide an understanding of the basic concepts related to the role of governments in the economy, and the findings of economic theory with regards to the limitations and ways in which governments may intervene. Students will learn to understand the basic tools to assess the viability and convenience of a given economic policy and understand how the current Competition, Trade and Environmental policies relate with the findings of academic research in Economics, and critically assess their impact in terms of efficiency and feasibility

Educational Aims

On successful completion of this module students will be able to:

  • Understand the basic concepts related to the role of governments in the Economy, and the findings of Economic Theory with regards to the limitations and ways in which the government may intervene.
  • Understand the basic tools to assess the viability and convenience of a given economic policy
  • Understand how the current Competition, Trade and Environmental policies relate with the findings of academic research in Economics, and critically assess their impact in terms of efficiency and feasibility.

Outline Syllabus

  • Why the government? Theory of government, market failures, public goods, common pool resources
  • Policy Evaluation: Cost Benefit Analysis
  • Basic Public Choice: Political Failures, Arrow Theorem, Condorcet paradox, fundamentals of voting theory
  • Competition Policy
  • Globalization and FDI
  • Climate Change and Emission-Control Policies      

Assessment Proportions

  • Coursework: 30%
  • Exam: 70%

ECON320: Applied Macroeconomics

  • Terms Taught: Lent / Summer Terms only.
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites:
    • Introductory Macroeconomics
    • Introductory Statistics.

Course Description

This course aims to increase understanding of the ways in which macroeconomic theory and quantitative methods can be applied to the analysis of international economics and the economic history of the UK. The course seeks to integrate intermediate macroeconomic theory, statistical methods and interpretation of data and empirical results to analyse applied macroeconomic issues of importance to economists, businesses and policy makers (exchange rate regimes, international parity conditions, economic business cycles and monetary unions).

Educational Aims

The aim of this course is:

  • To familiarise the student with the analytical tools that economists use to analyse international economic interactions.
  • To develop an understanding of the role of international economics and finance in the world economy.
  • To familiarise the student with the economic history of the UK in general and of the pound sterling in particular.

Outline Syllabus

  • Balance of Payments, Exchange rate regimes and The History of the Pound Sterling (Gold standard, Bretton Woods, European ERM, Floating rate).
  • Prices in the Open Economy: PPP: Absolute PPP, Relative PPP. A look at the facts (also, e.g. analyse prices and the real exchange Dollar/Pound since 1792). Productivity effects: Balassa-Samuelson model.
  • Evidence on international parity conditions. Uncovered Interest Parity (UIP); Uncovered Interest Rate Parity (UIRP); Covered Interest Rate Parity (CIP). Efficient Markets. A look at the facts.
  • Business Cycles. Economic fluctuations in the short run.
  • Optimum Currency Areas and Monetary Union. Benefits and Costs of MU: Transaction costs, costs of uncertainty, labour market, importance of openness, dealing with shocks, fiscal sovereignty, monetary sovereignty and the central bank. The cost of transition: Convergence criteria

Assessment Proportions

  • Coursework: 40%
  • Exam: 60%

ECON321: Sports Economics

  • Terms Taught: Michaelmas term only
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites: Intermediate Microeconomics.

Course Description

This course aims to provide students with detailed understanding of the application of theoretical and empirical models to the field of sports, to explore policy issues impinging on the competitive balance, and uncertainty of outcome in professional team sports leagues. The course requires the knowledge of basic analytical tools including graphs, calculus, basic algebraic manipulation and appreciation of econometric and other evidence. By the end of this module, students will have enhanced their knowledge of applied microeconomics as applied to the sports sector. The module aims to enhance student ability to undertake logical and structured problem-based analysis, to present clearly technical materials relevant to the sector and to appreciate actual economic problems facing stakeholders and policy makers.

Educational Aims

On successful completion of this module students will be able to:

  • Critically evaluate the theoretical literature relating to  economics of sport;
  • Demonstrate an awareness of the distinctive characteristics of labour and product markets in professional sports, and their implications for economic analysis;
  • Demonstrate an appreciation of the role of the empirical work in testing the various theories;
  • Understand the implications of theoretical and empirical work in the economics of sport for policy issues including competitive structures in sport leagues, free agency and player mobility, and the financing of professional sport;
  • Understand why people gamble on sports and how betting markets function

Outline Syllabus

  • Principles of sporting competitions: what do clubs maximise, wins or profits? Open and closed leagues. Uncertainty of outcome.
  • Attendance demand: roles of prices, income and market size. The travel cost method of estimating price elasticity.
  • Ticket pricing: price discrimination, season tickets, dynamic ticket pricing, secondary markets.
  • Broadcast markets: the supply of broadcasting, is Sky a monopolist? Audience demand. Consumer surplus in the broadcast market. Collective versus individual selling of TV rights.
  • Betting markets (1): why do people gamble on sports events?
  • Betting markets (2): the favourite-longshot bias: evidence and rationales
  • Betting markets (3): testing for market inefficiencies, the roles of insider trading and sentiment, do inefficiencies persist? Anomalies in sports betting
  • Player labour markets: salary determination, pay and performance in sports, team production, superstar effects.
  • The market for head coaches: do head coaches make a difference to team performance? Does firing a head coach raise team performance?
  • Stadium economics: assessing the value of a new stadium, private and public funding of stadia; rent-seeking behaviour.

Assessment Proportions

  • Coursework: 33%
  • Exam: 67%

ECON322: Health Economics

  • Terms Taught: Michaelmas Term only
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites: Intermediate Microeconomics

Course Description

The purpose of this course is to introduce students to the economics of heath and health care.  The course provides a comprehensive set of economic tools to critically appraise fundamental issues in the economics of health while offering a broad overview of the UK National Health Service and other health care systems around the world. The emphasis is on the use and interpretation of microeconomic models and the most current empirical evidence.

Educational Aims

On the successful completion of this module students will:

  • have a comprehensive knowledge of the major theories and evidence in the field of health economics
  • have an overview and understanding of the main policy issues in health and health care
  • have gained further experience of how to apply basic microeconomic principles to address issues of resource allocation,
  • be able to argue coherently about the efficiency of allocation mechanisms,
  • have developed their awareness of methodological issues surrounding the effectiveness of policies

Outline Syllabus

  • Health economics: a global overview  
  • Production of health
  • Demand for health capital
  • Health insurance         
  • Market and market failures
  • Cost-benefit analysis principles in health
  • Statistical tools for Health Economics
  • Equity in health and health care         
  • Doctors and the health workforce            
  • Population health and public health interventions

Assessment Proportions

  • Coursework: 33%
  • Exam: 67%

ECON323: Public Economics

  • Terms Taught: Lent / Summer Terms only.
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites: Intermediate Microeconomics.

Course Description

This course is concerned with understanding the role of government in the economy. It combines classical topics – such as the provision of public goods, the design of taxation, and intergenerational distribution – with more recent themes.

First, we will look at the political economy approach to public finance, which stresses that governments are not benevolent dictators, but take decisions via a political process, and thus may themselves take inefficient decisions; thus, we should be aware of government failure as well as market failure.

Second, due to globalization, the international dimension in government decision-making is becoming more important, especially on the tax side, with issues of mobile tax bases and tax competition.

Third, many countries (although, so far, notably, not the UK) are undergoing a process of fiscal decentralization; we will examine the fiscal relationships between central and local government, a topic known as fiscal federalism.

This course requires the knowledge of basic analytical tools (i.e. being able to draw graphs, use calculus and basic algebraic manipulations)

Educational Aims

  • Identifying the characteristics of public goods, and their optimal and efficient provision
  • Explaining the basic characteristics of a tax system, both under classical hypotheses and under a richer political economy approach
  • Understanding the effects of globalisation and international mobility of capital and labour on modern tax systems
  • Being able to understand the theoretical and practical implication of a federal institutional setup on taxation and public good provision
  • Engage with the most recent research literature and the current affairs pieces of news in order to criticize and assess how the economic models help us to understand reality
  • Understand and present the policy implication deriving from the economic models, and critically analyse how these implication depend on the modeling techniques
  • Synthesize effectively the current literature in a topic so to explain succinctly and clearly to a class or in an exam. Confidently possess the basic concepts of both classical and contemporary public economics, engaging with economic models and econometric findings.  

Outline Syllabus

  • Why the Public Sector, what's the role of bureaucracy ? Some statistics.
  • Public good provision: Samuelson, Lindahl, Groves-Clark
  • Asymmetric Information in the Public Sector
  • Voting
  • Optimal Commodity Taxation
  • Optimal Income Taxation
  • Tax Evasion
  • Fiscal Federalism
  • Tax Competition and Intergovernmental Grants
  • Social Security

Assessment Proportions

  • Coursework: 33%
  • Exam: 67%

ECON324: Advanced Macroeconomics

  • Terms Taught: Michaelmas term
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites:
    • Intermediate Macroeconomics
    • Intermediate Quantitative Methods.

Course Description

This course provides you with an overview of important topics in macroeconomics, such as stabilisation policy under rational expectations, the Lucas critique of policy evaluation and the implications of asset market efficiency for macroeconomic behaviour. The course emphasises the application of theory to these issues.

Educational Aims

On successful completion of this module students should be able to:

  • analyse problems by identifying appropriate economic models and select the appropriate techniques to solve those problems
  • use rigorous economic arguments to justify conclusions
  • communicate effectively

Outline Syllabus

  • Solution of Models using Rational Expectations
  • Stabilization Policy
  • Policy Evaluation I: The Lucas Critique
  • Policy Evaluation II: Taylor Rules
  • Applications of Rational Expectations: Market Efficiency in Exchange Rates, Interest Rates and Forecasting
  • Ramsey-Cass-Koopmans Growth Model
  • Real-Business-Cycle Models:
  • Labour Market Analysis

Assessment Proportions

  • Coursework: 33%
  • Exam: 67%

ECON325: Advanced Microeconomics

  • Terms Taught: Lent / Summer Terms only.
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites:
    • Intermediate Microeconomics
    • Intermediate Quantitative Methods.

Course Description

The course develops understanding of advanced material in the field of microeconomic analysis, with particular reference to how such material can inform policy-making. Topics include production theory, the axiomatic foundations of economy-wide production, preferences, utility and consumer behaviour, general equilibrium and the ‘core’ of an exchange economy, uncertainty and risk, game theory and strategic behaviour, the role of information, mechanism design and welfare analysis.

Educational Aims

By the end of this course, students should have knowledge and understanding of the nature and importance of the logical underpinnings of economics as a discipline, and of the value of microeconomic theory in explaining a wide range of observed phenomena.

Outline Syllabus

  • The envelope theorem and its applications 
  • Production and the Robinson Crusoe economy
  • General Equilibrium: The core, convexity and the separating hyperplane theorem
  • Social choice
  • Choice under risk and uncertainty 
  • Game theory, oligopoly
  • Time and asset markets
  • Public goods and externalities
  • Information

Assessment Proportions

  • Coursework: 33%
  • Exam: 67%

ECON326: Monetary Macroeconomics

  • Terms Taught: Michaelmas Term only.
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites: Intermediate Macroeconomics.

Course Description

This course examines the essential characteristics of a money economy. Topics include: non-neutral money; interest rate determination; the national debt; international payments; rational expectations solutions and applications to stabilisation policies; the central bank and inflation bias.

Educational Aims

The outcome of this course should enable students:

  • to understand: the conduct of monetary policy; rational expectations; stabilisation policy; the role of central banks and their interactions with financial markets.
  • to use theory to evaluate monetary policy and to interpret events

Outline Syllabus

  • Empirical Evidence on Money, Prices, and Output and a Macro Theory Review
  • DSGE Models for Monetary policy
  • Nominal Rigidities, Monopolistic Competition and the New Keynesian Model
  • Monetary Policy Analysis in New Keynesian Models Directions. (Here)
  • Open Economy and Monetary Unions 
  • The Instrument Choice Problem  
  • Inflation Targeting
  • Independent Central Banks  The Barro Gordon Model
  • The Financial Crisis and Macro prudential Policy  
  • Monetary- Policy Operating Procedures
  • Term Structure and Financial Markets

Assessment Proportions

  • Coursework: 33%
  • Exam: 67%

ECON327: Labour Economics

  • Terms Taught: Lent / Summer Terms only.
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites:
    • Intermediate Microeconomics
    • Intermediate Quantitative Methods.

Course Description

This course focuses on demand and supply in the labour market, giving special attention to instances where the market fails to clear. Emphasis is given to modern theories of unemployment that provide microeconomic rationale for wage induration, including insider-outsider, efficiency wage and monopsony models. Institutional labour market features covered include: union-firm bargaining, the role of welfare benefits, and internal labour markets.

Educational Aims

Upon completion of this course, you should be able to:

  • understand the methods of applied and theoretical economics in the context of the economics of labour and human resources
  • use methods of economic analysis when confronted by previously unseen labour market problems
  • engage in abstract thinking by extracting the essential features of complex systems to facilitate problem solving and decision-making
  • engage in deductive and inductive reasoning to enhance problem solving and decision-making skills
  • apply theoretical, historical and quantitative methods to the analyses of  HR issues and problems
  • plan and manage your time effectively in relation to deadlines whilst displaying individual initiative and enterprise
  • conduct individual assignments and perform effectively in a group environment by demonstrating leadership and team-building qualities
  • demonstrate a logical argument, analyse and interpret data and evaluate alternative perspectives on the basis of objective reasoning
  • communicate and present complex arguments in oral and written form with clarity and succinctness
  • understand the nature of incentives and opportunity costs in decision-making
  • think in marginal terms about the trade-offs involved in public policy and business decision-making
  • work effectively both individually and within a team environment

Outline Syllabus

  • Introduction, Labour Supply and Demand
  • Labour Market Equilibrium, Wage Determination and Policy
  • Unions and Employment Protection Legislation
  • Human Capital and Training
  • Migration and Mobility
  • Discrimination and Wage Differentials
  • Principal Agent Problems and Incentive Pay
  • RPE, Tournaments and CEO Pay
  • Implicit Contracts and Efficiency Wages
  • Teams, Peers, Group Payment and Intrinsic Motivation

Assessment Proportions

  • Coursework: 33%
  • Exam: 67%

ECON329: Mathematical Economics

  • Terms Taught: Michaelmas Term only.
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites:
    • Intermediate Mathematical Economics.
    • NB: This course is only available to students who are spending a full academic year at Lancaster.

Course Description

This course familiarises you with some of the important mathematical concepts used in economics. The first five weeks are devoted to matrix applications including input output models, linear programming, and data envelopment analysis. The second five weeks cover calculus and its application in economics.

Educational Aims

This course aims to familiarise students with some of the important mathematical concepts that are used in theoretical and empirical economics.

Outline Syllabus

  • Matrix applications: Input-output analysis, assumptions, transactions table, derivation of method, multipliers, applications and critique.
  • Introduction to linear programming, graphical approach, the simplex algorithm, sensitivity analysis, the dual, applications and critique.
  • Extending the linear programming method: data envelopment analysis and its applications
  • Rules of differentiation and partial derivatives. Special determinants ? Gradient, Hessian and Jacobian. Homogenous functions and Euler's Theorem. Economic Applications.
  • Total differentials and total derivatives. Implicit function theorem. Comparative Statics. Convexity and Concavity. Economic Applications.
  • Unconstrained optimisation. Comparative Statics. Economic Applications.
  • Constrained optimisation. The Lagrange method. Comparative Statics. Economic Applications.
  • Introduction to integration. Economic Applications.

Assessment Proportions

  • Coursework: 33%
  • Exam: 67%

ECON330: Econometrics

  • Terms Taught: Michaelmas Term only.
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites:
    • Introductory econometrics.
    • NB: This course is only available to students who are spending a full academic year at Lancaster.

Course Description

This course equips you with tools necessary to conduct applied econometrics. An analytical and intuitive understanding of the classical linear regression model is emphasised, as well as newer topics such as specification tests, binary choice models, Tobit analysis, sample selection bias, non-stationary time series, and unit root tests and basic co-integration. You will use the econometrics software, Eviews.

Educational Aims

This course aims to equip students with the tools necessary to conduct applied econometrics. While students will be given an analytical and intuitive understanding of the classical linear regression model, they will also be studying newer topics such as specification tests, binary choice models, Tobit analysis, sample selection bias, non-stationary time series, and unit root tests and basic cointegration.

Outline Syllabus

Week 1: Ordinary Least Squares

  • Classical and Multiple Linear Regression Models.
  • The OLS Estimator.
  • The Gauss-Markov Theorem.

Week 2: Hypothesis Testing and Misspecification

  • The t-test.
  • The F-test
  • Tests for Normality.
  • Choosing the Functional Form.
  • Omitted variables and over-parameterization.
  • Restricted least squares.
  • Tests for Parameter stability.

Week 3: Applications of Generalised Least Squares

  • Heteroscedasticity
  • Autocorrelation
  • Tests for Heteroscedasticity.
  • Tests for Residual Autocorrelation.

Week 4: Multicollinearity

  • Consequences.
  • Detection.
  • Solutions.

Week 5: Models with Dichotomous Dependent Variables

  • The Linear Probability Model.
  • The Logit Model.
  • The Probit Model.

Week 6: Time Series Analysis

  • Return, Market Activity and Volatility.

Weeks 7 and 8: Dynamic Models, Unit Roots and Co-integration

  • Definitions and Concepts.
  • Lag Operators.
  • Univariate Time Series Models AR, MA ARMA.
  • Deterministic and Stochastic Trends.
  • Unit Roots and Unit Roots Tests.
  • Co-integration Analysis.
  • VAR (Vector Autoregressive Models).
  • Building a VAR model.

Weeks 9 and 10: The Econometrics of Panel Data

  •  Panel Data Examples and Applications
  • Panel Data Estimators
  • Hausman Specification Test

Assessment Proportions

  • Coursework: 33%
  • Exam: 67%

ECON331: Industrial Organisation

  • Terms Taught: Lent / Summer Terms only.
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites: Intermediate Microeconomics.

Course Description

This course focuses on firm behaviour and competition, using theoretical (especially game theoretic) models. The relationship between industry structure and firm conduct is explored, together with aspects of firm behaviour such as advertising, R&D and mergers.

Educational Aims

Course Aims and Objectives:  

  • To understand the crucial role of strategic thinking in firm decision making
  • To apply theoretical micro-economics methods to understand firms and regulators decisions
  • To use empirical economics research methods to understand the behaviour and development of firms, markets and industries
  • To understand current themes in the industrial economics literature 

Outline Syllabus

  • Introduction to Industrial Economics and The Nature of The Firm
  • Measures Structure, Conduct and Performance
  • The Structure Conduct Performance Debate
  • Product Differentiation and Advertising     
  • Research and Development  
  • Firm Ownership: Privatisation and Regulation    
  • Barriers to Entry and Strategic Entry Deterrence
  • Horizontal Mergers
  • Vertical Integration  
  • Cartels and Competition Policies                          

Assessment Proportions

  • Coursework: 33%
  • Exam: 67%

ECON332: Development Economics

  • Terms Taught: Lent / Summer Terms only.
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites: Intermediate Micro and Macroeconomics.

Course Description

This course develops an understanding of advanced material in the field of economic growth, with particular reference to the application of theoretical material to the development experience and policy-making in developing and emerging economies.

Educational Aims

By the end of this course students should have an understanding of:  

  • Basic economic theories of growth and development.
  • The application of relevant theories to the growth experience of several economies.
  • The range of alternative growth policies that may be used to achieve development.
  • The inter-disciplinary nature of the subject of development economics.
  • Themes in micro- and macro-economics on the basis of specialist knowledge and understanding.

Outline Syllabus

  • Introduction to Economic Growth  Development
  • Economic Growth, Convergence and Endogenous Growth Theory
  • Inequality and development
  • Internal migration
  • India as an Emerging Economy
  • Topics in micro-development:  Labour Markets
  • Topics in micro-development:  Land tenure and contracts
  • Topics in Development: Financial Markets Micro-Credit
  • Trade and Development

Assessment Proportions

  • Coursework: 33%
  • Exam: 67%

ECON333: International Trade

  • Terms Taught: Lent / Summer Terms only.
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites: Intermediate Micro and Macroeconomics

Course Description

This course develops understanding of concepts and theories of international trade and factor flows, with particular reference to the way in which such material can inform policy-making.

Educational Aims

The objectives of the course are to:  

  • Introduce students to the basic concepts and theories of international trade
  • Train students in the application of trade theories to the analysis of policy issues relating to international trade
  • Train students in methods of economic analysis and problem solving. 

Outline Syllabus

  • Introduction. The Ricardian Model of Trade
  • The specific factors model of trade
  • The Heckscher-Ohlin Model of Trade
  • International factor mobility
  • Imperfect Competition, Economies of Scale and International Trade
  • Offshoring of goods and services
  • Further topics in trade theory
  • Trade policies under perfect competition
  • Trade policies under imperfect competition
  • Further topics in trade policy

Assessment Proportions

  • Coursework: 33%
  • Exam: 67%

ECON334: International Business

  • Terms Taught: Michaelmas Term only.
  • US Credits: 4 semester credits
  • ECTS Credits: 8 ECTS
  • Pre-requisites: Intermediate Micro and Macroeconomics

Course Description

This course develops understanding of advanced material in the field of international business, with particular emphasis on the analysis of the strategic economic and financial behaviour by multinational firms in the global economy.

Educational Aims

This module aims to provide an introduction to the economic analysis of International Business and Finance though the teaching and application of core theory to critical issues in the subject. This permits an improved understanding of the activities of, and interaction between, multinational enterprises (MNEs) in the international economy together with international financial management. The course critically examines the evolution of theories of MNEs, International Business and exchange rate determination.

Outline Syllabus

  • International Business & Globalisation. 
  • The Market Imperfections Approach to International Business. 
  • Technology & Competitive Advantage in International Business.
  • The Internationalisation of International Business.
  • International Market Entry, Competition & Strategic Interaction.
  • Risk in International Business.
  • Foreign Exchange Risk Management.
  • Foreign Exchange Derivative Contracts.
  • Financing FDI I: the Cost of Debt.
  • Financing FDI II: Equity & Portfolio Diversification.

Assessment Proportions

  • Coursework: 33%
  • Exam: 67%