Course Information Undergraduate prospectus

Macroeconomics and Microeconomics in Context II

Course summary

Course code: ECON1141
Level: 6
Credits: 30
School: Business Faculty
Department: International Bus and Economics
Course Coordinator(s): Maria Cagliesi

Specification

Introduction and rationale

Integrated Macroeconomics and Microeconomics
Change current structure to allow introduction of new course at level 5

Aims

This is a core unit in microeconomics and macroeconomics at an advanced level (level 6 – final year) for
the BSc Economics programme. The module aims to develop the skills, knowledge and tools of
analysis knowledge necessary for a career where research skills in economics are required. It
presents important developments in microeconomic topics and in macroeconomic growth and
related problems, providing a broad perspective to apply those research skills and analytical tools to
the big‐picture questions of sustainable growth, inequality and divergence of economies.
The main objective is to provide a rich overview of the field at an advanced level and to examine a
multiplicity of topics so to expose students to main views and make them aware of strengths and
weaknesses of various approaches. The course offers abundance of current real‐world examples and
applications to make theoretical exposition close to experience.

Learning outcomes

On successful completion of this course a student will be able to:
Learning
Outcome
1
Demonstrate a systematic understanding of core areas of the discipline and a
coherent and detailed knowledge of analytical methods, both theory and model
based
2 Competently deploy established techniques of analysis and use accurately verbal,
graphical, mathematical and econometric representation of economic ideas and
analysis, including the relationship between them
3 Critically review, consolidate and extend theoretical knowledge and to contextualise
and apply economic theories to real world factual evidence and current policy issues
(such as: social, environmental, global, and sustainable) in order to simulate different
policy scenarios
4 Critically evaluate and synthesise concepts and evidence from a range of resources
and demonstrate more extensive knowledge and skills of quantitative or theoretical
modelling areas of economics and/or econometrics
5 Handle and interpret data relevant to the study of economics in the context of
international markets and synthesise and communicate findings, solutions, arguments
and ideas clearly and in a variety of forms to specialist and non‐specialist;
6 Show an appreciation of the limits of knowledge and identifying the interaction of
economics with other social sciences and micro and macro context of business

Indicative content

The course consists of two parts: a Macroeconomic part and a Microeconomic part.
Theory, methodology and applications (pluralism)
MACROECONOMICS (A):
Growth in dynamic general equilibrium (non‐stochastic discrete time models):
This part will introduce macroeconomic modelling of long term growth, comparing Neoclassical,
Austrian and Endogenous theories of economic growth and their applications. Some models will be
used in simulations to shed light both on the process of economic growth at the world level and on
sources of income and growth differences across countries.
Topics: Growth accounting, neoclassical growth model, Austrian growth model, endogenous growth,
 Stylized facts of economic growth and development
 The Solow growth model and the data; growth accounting, levels accounting, and the facts.
Fundamental causes of income differences
 Schumpeterian growth
 Neoclassical endogenous growth: capital accumulation, externalities, and human capital
 Interdependences: human capital, technology diffusion, trade, and the world income
distribution in an open economy
 Competitive growth under uncertainty
MICROECONOMICS (A):
 Imperfect information and the performance of organisations and markets
 Inefficiencies arising from asymmetric information: models of adverse selection and moral
hazard
 Policy: construct strategies to overcome the problems of imperfect information
 Insurance and decision‐making under uncertainty;
 Principal agent theory;
 Behavioural economics
Policy in context
MACROECONOMICS (B):
The political economy of growth (institution, environmental, information)
This part will focus on policy promoting sustainable growth, focusing on the role of innovation,
technology and human capital.
 Inequality, Credit Market Imperfections, and Human Capital
 Innovations and directed Technological Changes
 The Impact of Institutions on Long‐Run Development
 Distributional Conflict and Economic Growth
 Sustainable growth and the environment
 Political Institutions and Growth‐Enhancing Policies
MICROECONOMICS: (B)
 Work/Family Challenges: Employer Policies, Government Policies, Distributing the Costs of
Care
 Globalization and the Information Revolution: Multinational Corporations; Global Markets;
Global Competition and Well‐Being
 The Public Purpose Sphere: Social Welfare: Regulation of Monopolies and Trade Practices

Teaching and learning activity

Lectures will be devoted to the introduction of the relevant models of modern macroeconomics and
microeconomics, to the discussion of ground‐breaking research findings of the past decade and their
applications. Seminars will be focused on presenting and reviewing specific topics and articles, on
problem solving, group work, data and case study analysis.
Lectures: Lecture will start by contextualizing economic concepts and theories by using specialist
readings on current debates of important economic events, policy decisions occurred during the
week, linked to the theoretical material to be developed during the academic year. The readings will
be taken from the most accredited economic source, such as the Financial Time (F.T.) and the
Economists. This exercise aims at fostering class debate, bridging theory and practice so as to
provide ideas for future dissertation topics.
Tutorials: These activities range from searching of on line material (such as journal articles,
speeches, on line exercises), problem solving exercise using on line or other sources, group
discussions and simulations. The aim of these sessions is to stimulate interactive learning activities.
Students will be asked to solve sensitivity analysis exercises and to engage in simulation exercises from
specific software packages through changing parameters of models and comparing the results. Group
tutorials are intended also to provide opportunities to practice effective communication skills (both
oral and writing) by explaining theoretical concepts and/or empirical findings to different audiences
(economists and non‐economist).

Assessment

Simuation Excerises - 60%
Outcome - 1,2, & 3
5000 (2,500 each simulation)
Students are required to explore models and manipulate them by Problem sets are online exercises to assess
engagement during the undertaking tasks which require a series of decisions to change inputs so to achieve specific goals to provide an
explanation of actions and an evaluation of the results.

Portfolio - 40%
Outcome - 1,3,4,5 and 6
3500 Words
Problem sets are online exercises to assess engagement during the year and to work on feedback to improve performance during terms.
The integrated patchwork is a series of tasks and activities built around a theme to be developed by integrating different perspective and
approaches.

Pass mark 40%