Applied Economics course curriculum

This unit provides students with a robust foundation of core models and techniques. The unit aims to equip students with a well-founded basis in statistical methods that will allow them to appreciate and apply confidently modern statistical tools used in the study of economic data and decisions.

You’ll learn to:

• Identify real economic problems and apply corresponding economic models
• Analyse economic situations using optimization techniques
• Interpret results of fundamental economic models
• Analyse fundamental discrete and continuous distributions and be able to apply them
• Apply the concepts of random sampling, statistical inference and sampling distribution
• Compare and contrast fundamental concepts of statistical inference and its applications

Gain an advanced knowledge of the theory and techniques of modern microeconomic analysis and equip them with the skills required for modelling decision-making in applied settings. Grasp an overview of behavioural economics and gain a critical appreciation of the theoretical tools used in these relatively new but increasingly important areas of economics.

You’ll learn to:

• Understand how to model individual preferences and decision making with and without risk
• Explain the development and use of behavioural economic models to rival those that are standard in neoclassical economics – for example, consumer theory
• Evaluate how market equilibrium is formed and the welfare characteristic of such equilibrium in the context of no market failures
• Interpret equity and distributional issues
• Interpret social preferences, analyse social choice and evaluate voting systems
• Give a social-economic analysis of the market equilibrium and define possible policy interventions

Extend the knowledge gained from Applied Microeconomics A to cover a range of different microeconomics problems. Gain a practical knowledge and understanding of market failures and government policies/interventions in various socio-economic realms.

You will also learn about the main concepts and principles of public policy analysis.

You’ll learn to:

• Critically evaluate the income inequality and recognise the role of public policies
• Evaluate how market equilibrium is formed and the welfare characteristic of such equilibrium with market failures such as externalities, public goods, asymmetric information
• Understand how microeconomic theory can be applied to a variety of practical settings (environmental economics, public economics, etc…)

The unit aims to introduce students to modern macroeconomic analytical frameworks and their application to the latest macroeconomic issues, such as economic growth, sustainability of a pension systems and optimal taxation. The unit will prepare students for taking part in professional discussions about a theory-based design of macroeconomic policies.

You’ll learn to:

• Evaluate analytically a range of macroeconomic models and their implications for macroeconomic policy in the long-run
• Understand how macroeconomic models, such as the Diamond model and the Ramsey model, can be used to understand topical economic issues and suggest policy responses

The unit is complementary to Applied Macroeconomics A and its aims are to introduce students to up to date macroeconomic theories and their application about the labour market, monetary theory and central banks objectives. The unit will prepare students for taking part in professional discussions about designing macroeconomic policies based on macroeconomic theory.

You’ll learn to:

• Critically evaluate and analytically solve a range of macroeconomic models, judging their implications for macroeconomic policy
• Understand how macroeconomic theory can be used to understand topical economic issues, such as unemployment and banking regulation, and suggest policy responses

Gain the knowledge and skills necessary to understand and appreciate the findings of empirical academic literature in a variety of areas within economics and learn how to conduct your own basic investigations over a range of economic relationships.

You’ll learn to:

• Use and interpret the results of the classical regression model
• Use recommended econometric software to undertake your own empirical investigation
• Analyse and reflect on empirical results derived using the econometric software
• Test the validity of simple empirical models using a wide range of diagnostic results

The unit aims to provide students with the knowledge and skills necessary to understand and appreciate the findings of the empirical academic literature in a variety of areas within economics. Extend the knowledge gained from Applied Econometrics A to cover a range of different applications/estimation scenarios.

You’ll learn to:

• Use the recommended econometric software to undertake their own empirical investigation
• Understand the differences between cross-section, time series and panel data and be able to select suitable estimation methods
• Apply diagnostic tests as appropriate to the type of data and econometric model
• Interpret the results of estimated models

Game theory is a set of tools for studying situations in which decision-makers interact (such as consumers, firms, politicians, and governments). This unit provides a comprehensive yet intuitive introduction the sub-filed of non-cooperative game theory, namely simultaneous-move games. There will be a strong emphasis on applications of these techniques and equilibrium concepts to economics. The aim of this unit is to give students an understanding of a core concept of game theory, namely the so called Nash Equilibrium, and how to use it to understand and predict individual strategic behaviour as well as economic, social, and political phenomena.

You’ll learn to:

• Apply principles of economic-mathematical modelling to practical economic and business problems in which decision-makers choose their actions either simultaneously or at least in ignorance of each others’ decisions
• Evaluate economic and business problems by designing appropriate economic-mathematical models of simultaneous strategic interactions
• Solve, analytically or numerically, economic-mathematical models of simultaneous strategic interactions using quantitative methods
• Develop analytically founded policy or business recommendations

Game theory is a set of tools for studying situations in which decision-makers interact (such as consumers, firms, politicians, and governments). This unit provides a comprehensive yet intuitive introduction the sub-filed of non-cooperative game theory, namely dynamic games and games of incomplete information. There will be a strong emphasis on applications of these techniques and equilibrium concepts to economics. The aim of this unit is to give students an understanding of core concepts of game theory, namely Backwards Induction, Subgame perfect Nash Equilibrium, and Bayes Nash Equilibrium. The aim of this unit is to allow students to construct predictions of individual strategic behaviour in dynamic settings so as to uncover the mechanisms behind important economic, social, and political phenomena.

You’ll learn to:

• Apply principles of economic-mathematical modelling to practical economic and business problems in which decision-makers choose their actions sequentially or in ignorance of each other’s characteristics
• Evaluate economic and business problems by designing appropriate economic-mathematical models of dynamic strategic interactions
• Solve, analytically or numerically, economic-mathematical models of dynamic strategic interactions using advanced quantitative methods
• Develop analytically founded policy or business recommendations
• Construct programs using mathematical computing software in order to solve/simulate economic models of dynamic strategic interactions that capture important real-world phenomena

Learn about the assessment of risks inherent in the management of financial institutions and the importance of such institutions in a country’s economic development. The effectiveness of supervision and surveillance to ensure the financial stability of the economy will also be covered.

You’ll learn to:

• Appreciate the importance to the economy of its financial structure (markets and institutions)
• Understand and critically evaluate the economic rationale underpinning the operations of banks and similar institutions
• Identify the macroeconomic interface between these institutions and the 'real' economy
• Critically evaluate the importance of regulation and its limits

You will cover the main aspects of monetary policy at an advanced level with an emphasis on recent developments.  You will gain the knowledge; conceptual framework; awareness of areas of controversy and debate; and the technical skills you need to achieve a critical understanding of recent advanced research in monetary economics.

You’ll learn to:

• Develop rigorous arguments through precise use of concepts and mathematical models
• Select, summarise and synthesise written information from multiple sources
• Select and use appropriate ideas to produce a coherent response to a pre-set question
• Deliver comprehensive and scholarly written communications
• Produce concise and effective written communications
• Deliver effective oral communications, such as lectures and Q&A sessions

Gain an overview of investment and trading decisions in financial markets. The unit is complemented with an overview of the behavioural biases of investors, managers and other economics agents on the financial markets. You’ll also learn how these biases affect market outcomes. 

You’ll learn to:

• Assesses the investment decisions of individuals
• Evaluate the efficiency of markets
• Use a range of techniques to value stocks
• Analyse trading strategies in financial markets
• Evaluate the behavioural biases of economic agents on the financial markets, and analyse their consequences
• Critically assess whether features of financial markets reflect market efficiency

You will gain an overview of decision making in a financial context and how this affects the valuation and use of securities.

You’ll learn to:

• Assess financial decision making
• Evaluate the value of securities
• Use securities to meet investment objectives
• Analyse the decision of companies with respect to capital structure and dividend policy

You will develop your research, data handling and data description skills, and be taught how to effectively present and interpret economic data using tables and graphs. You will also gain an understanding of relevant economic statistics and hypothesis testing. The unit will include analysis of examples of applied economic research.

After completing your research you will be able to:

• Undertake and present quantitative research
• Represent and analyse economic data
• Demonstrate effective communication through written work and presentation skills

Research a topic in mainstream economics or, where appropriate, the economics of development.

The project can be taken over 2 months, 4 months, or 8 months. Students choosing the shorter pathways may have a substantially higher workload per week.

After completing the project you will have:

• A systematic and analytical understanding of your chosen topic area
• An ability to theorise on and/or empirically explore the chosen topic
• An ability to draw appropriate conclusions and demonstrate an awareness of their strengths and limitations