2010-11 academic year
Economics (20637)
Degree/course: degree in Business Sciences
Year: first
Term: first and second
Number of ECTS credits: 9 credits
Student commitment: 225 hours
Teaching language or languages: Spanish
Lecturers: Marcela Arqueros, Francisco Galicia and Walter Leonel Muinelo
1. Presentation of the subject
The objective of the subject is to introduce students to the main problems raised by the modern economy from the micro- and macroeconomic point of view.
In specific terms, the questions we will be analysing include what determines microeconomic behaviour among businesses and individuals how the various economic agents take decisions; how commercial exchanges are established and the various ways of organising markets.
From the macroeconomic point of view, we will analyse the aggregate function of the economy. We will try to answer questions like what the aggregate objective of the economy is, how economic development is measured, what is responsible for economic cycles, and the monetary policy or fiscal policy measures can be taken to control macroeconomic changes.
During the course, we will present the type of reasoning, concepts and analysis of economics. We will use simple models to learn to analyse the main economic problems such as the lack of resources and the efficient assignment of resources. Finally, we will consider the basic instruments for analysing the various macroeconomic policies: fiscal policy and monetary policy.
2. Competences to be attained
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General competences |
Specific competences |
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Instrumental 1. Analysis and synthesis ability 2. Problem solving 3. Information management skills
Interpersonal 4. Clear and concise communication 5. Use of evidence to support ideas 6. Organisation of thoughts using a reliable process
Systemic 7. Research skills 8. Skills for autonomous work 9. The ability to learn
Other 10. Endeavouring to achieve continuous development
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1. The ability to organise, represent, summarise and analyse the information contained in series of data 2. The ability to draw scientific conclusions from information provided by samples or experiments 3. The ability to perform comparative studies between populations and detect possible relations between variables 4. The ability to interpret results based on statistical models 5. The ability to identify and statistically analyse the relevant information in complex problems 6. The ability to correctly apply statistical methodology to data analysis 7. The ability to use specific statistical techniques in solving real problems 8. The ability to interpret and statistical reports in precise terms 9. The ability to engage in abstraction and scientific reasoning 10. Interpret economic information from various sources, and analyse and criticise their content |
3. Contents
Syllabus - First term
Subject 1. - Introduction
1.1. - Definition of economics: the concept of efficiency and scarcity.
1.2. - The production-possibility frontier
1.3. - Basic decisions
1.4. - Microeconomics and macroeconomics
Subject 2. - The market
2.1. - The principle of individual rationality.
2.2. - The market and its agents.
2.3. - The demand curve. Position and displacements.
2.4. - The supply curve. Position and displacements.
2.5. - Price and quantity equilibrium in the market
2.6. - Elasticity.
Subject 3. - Consumption
3.1. - The consumer's maximisation behaviour
3.2. - Budgetary restrictions.
3.3. - Substitution and income effects.
Subject 4. - Production
4.1. - The production function of a company. Production processes.
4.2. - Short-term production.
4.3. - Short-term costs. The short-term relationship between costs and production.
4.4. - Long-term cost curves
Subject 5. - Supply
5.1. - Entering the market
5.2. - What happens when losses are incurred?
5.3. - The long term and the decision to leave
5.4. - The supply curve of business and market
5.5. - Short- and long-term supply in the market or industry.
Subject 6. - Perfect competition
6.1. - Market structure
6.2. - Perfect competition
Subject 7. - Markets with imperfect competition
7.1. - Monopolies. Oligopoly. Monopolistic competition.
7.2. - Comparison between markets with perfect competition and markets that are not perfectly competitive
Subject 8. - Advantages and limitations of the free market
8.1. - Economic efficiency
8.2. - Externalities
8.3. - Public goods
Bibliography
Basic:
Mankiw, G. Principis d'Economia. McGraw-Hill, 200X, latest edition.
Krugman, P and WELLS, R. Introducció a l'economia. Microeconomia. Worth Publishers. 2006.
Complementary:
HALL, RE and Lieberman, M. Economia. Principis i aplicacions. Thomson. 2003
FRANK, R. and B. Bernanke. Principis d'economia. McGraw-Hill, 200X.
Mochón, F. Principis d'Economia. McGraw-Hill, 200X, latest edition.
Distribution of the syllabus within the basic bibliography.
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Subject |
Mankiw |
Krugman / Wells |
|
Subject 1: Introduction |
Chap.2 - Thinking like an economist Chap.3 - Interdependence and earnings from trade |
Chap.1 - Basic principles Chap.2 - Economic Models: the PPF and trade. |
|
Subject 2: The market |
Chap.4 - Market forces of supply and demand Chap.5 - Elasticity and its application Chap.6 - Supply, demand and economic policy |
Chap.3 - Supply and Demand Chap.4 - The market strikes back Chap.5 - Elasticity |
|
Subject 3: Consumption |
Chap.21 - Consumer choice theory |
Chap.10 - The rational consumer Chap.11 - Consumer preferences and choice |
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Subject 4: Production |
Chap.13 - Production costs |
Chap.8 - What lies behind the supply curve. Production factors and costs |
|
Subject 5: Supply |
Chap.14 - Businesses in competitive markets |
Chap.9 - Perfect competition and the supply curve |
|
Subject 6: Perfect competition |
Chap.14 - Businesses in competitive markets |
Chap.9 - Perfect competition and the supply curve |
|
Subject 7: Markets with Imperfect Competition |
Chap.15 - Monopoly Chap.16 - Oligopoly Chap.17 - Monopolistic competition |
Chap. 14 - Monopoly Chap15 - Oligopoly Chap.16 - Monopolistic competition |
|
Subject 8: Advantages and Limitations of the Market |
Chap. 7 - Consumers, producers and the efficiency of markets Chap.10 - Externalities |
Chap.6 - Consumer and producer surpluses Chap.19 - Externalities Chap.20 - Public goods and Common resources. |
Syllabus - second term
Subject 1. - Introduction to macroeconomics
1.1. - Macroeconomic Questions
1.2. - Macroeconomic Policies
1.3. - Gross Domestic Product (GDP)
1.4. - Consumer price index (CPI)
Subject 2. - The economy in the long term I: Savings and Investment
2.1. - Savings
2.2. - Investment
2.3. - The loanable funds market
Subject 3. - The economy in the long term II: Unemployment
3.1. - The figures
3.2. - Types of unemployment
3.3. - Labour supply and demand
3.4. - Market trends
Subject 4. - The economy in the long term III: Money and prices
4.1. - Definition of money and its functions
4.2. - The European System of Central Banks (ESCB)
4.3. - Money Supply
Subject 5. - The economy in the long term IV: Open economies
5.1. - International capital movements
5.2. - Balance of payments
5.3. - Exchange rates
Subject 6. - The economy in the short term I: Aggregate Demand - Supply
6.1. - Economic cycles
6.2. - The AD-AS model
6.2.1. - The role of the money supply
6.2.2. - The role of aggregate expenditure
6.2.3. - Aggregate expenditure - GDP ratio
6.3. - Fluctuations in the model
Subject 7. - The economy in the short term II: The multiplier and fiscal policy
7.1. - The Keynesian multiplier
7.1.1. - Planned expenditure and GDP
7.1.2. - The multiplier and fiscal policy
7.2. - Fiscal policy and the AD-AS model
7.3. - Automatic stabilisers
Subject 8. - The real economy in the short term III: Financial markets and monetary policy
8.1. - The money market
8.1.1. - Money supply and demand
8.1.2. - The transmission mechanism
8.2. - Monetary policy and the AD-AS model
8.2.1. - Objectives
8.2.2. - Measures
8.3. - Monetary policy or fiscal policy?
Bibliography
Basic:
Mankiw, G. Principles of Economics. McGraw-Hill, 200X, latest edition.
Krugman, P and WELLS, R. Introducció a l'economia. Macroeconomia. Worth Publishers. 2006.
Complementary:
HALL, RE and Lieberman, M. Economia. Principles and applications. Thomson. 2003
FRANK, R. and B. Bernanke. Principles of Economics. McGraw-Hill, 200X.
Mochón, F. Principles of Economics. McGraw-Hill, 200X, latest edition.
Distribution of the syllabus within the basic bibliography.
|
Subject |
Mankiw |
Krugman / Wells |
|
Subject 1: Introduction |
Chap.23 - Measuring a country's income Chap.24 - Measuring the cost of living |
Chap.6 - Macroeconomics: an overall perspective Chap.7 - Assessing macroeconomics Chap.8 - Long term growth - Comparing economies over time and space Chap.16 - Inflation, disinflation and deflation |
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Subject 2: Savings and Investment |
Chap.26 - Savings, investment and the financial system |
Chap.9 - Savings, investment and the financial system |
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Subject 3: Unemployment |
Chap.28 - Unemployment and its natural rate |
Chap.15 - The labour market, unemployment and inflation |
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Subject 4: Money and prices |
Chap.29 - The monetary system Chap.30 - The growth of money and inflation |
Chap.13 - Money, the interbanking system and the Central Banks |
|
Subject 5: Open Economies |
Chap.31 - Macroeconomic analysis of open economies Chap.32 - A macroeconomic theory of open economies |
Chap.18 - International Trade Chap.19 - The macroeconomics of open economies |
|
Subject 6: Aggregate Demand - Supply |
Chap.33 - Aggregate demand and supply |
Chap.10 - Aggregate supply and demand |
|
Subject 7: The multiplier and fiscal policy |
Chap.34 - The influence of monetary and fiscal policy on aggregate demand Chap.35 - The short term dilemma between inflation and unemployment |
Chap.11 - Income and Expenditure Chap.12 - Fiscal Policy Chap.12 - Appendix Taxes and the multiplier |
|
Subject 8: Financial markets and Monetary Policy |
Chap.34 - The influence of monetary and fiscal policy on aggregate demand Chap.35 - The short term dilemma between inflation and unemployment Chap.36 - Five debates on monetary policy |
Chap.14 .- Monetary Policy |
4. Assessment
The final grade for the subject will be the arithmetic mean of two marks: the mark from the first term (the microeconomics part) and the mark from the second term (the macroeconomics part).
The grade for each term will consist of the mark obtained in each minitest and the mark in the final examination. The two marks will only be averaged when a grade of at least 4 is obtained in the final examination. A final examination graded with a lower mark will lead to a fail in this term.
The minitests will take place in all the seminars. They consist of a series of multiple choice questions or a problem. The minitests will take place at the end of the seminar and will last 15 to 20 minutes.
The minitests are compulsory. Unjustified failure to take the minitest will lead to a grade of zero points in this test.
The minitest accounts for 30% of the final mark. The final examination accounts for the remaining 70%.
Only the examinations for the failed term(s) need to be sat at the September sitting. The final grade will be the average of the examination plus the part passed, if there is one.
5. Methodology
The subject material consists of a theoretical part and a practical part.
The theoretical part is the cornerstone of the subject. All the theoretical material (concept, definitions, formulas, etc.) It will be presented in class during the theory sessions.
The theory sessions have two basic objectives. First, they would be used to present the basic points of each topic, and second, to consider the most important and most complex concepts in each topic in more depth.
The theoretical explanations for each topic will be accompanied by a series of transparencies and by bibliographical references for additional information to expand upon the explanations.
The practical part will take the form of seminars. The objective of the seminars is to put the theoretical concepts analysed in the theory sessions into practice.
The activities to be carried out in the seminars will be either solving a series of lists of questions and problems related to the theory set out and explained in the classes or comments on some practical cases.
There will be five lists per term during the course, with contents on the chapters of the programme, as shown in the following tables.
First term lists:
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List |
Subjects |
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1 |
1 |
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2 |
2 |
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3 |
3 |
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4 |
4 and 5 |
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5 |
6 and 7 |
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Second term lists:
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Students must work on the lists on their own account and on their own behalf. They do NOT have to be handed in but the students themselves will solve the problem on the blackboard in the seminars.
In addition to helping with understanding of the theoretical concepts discussed in class, the lists can be used by students to familiarise themselves with the structure of the final examination in the subject.
After the list has been discussed in class, the solutions will be uploaded to the subject website.
The subject website will be used throughout the course. All the subject material will be uploaded here: the list of classes, solutions and additional materials such as reading, data, other exercises, etc.
All updates to materials on the website will be notified in class and on the website.
6. Planning of activities
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Week |
Work in the classroom group / type of activity |
Work outside the classroom group / type of activity |
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Week 1 |
Session 1 - Subject 1 Session 2 - Subject 1 |
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Week 2 |
Session 1 - Subject 2 Session 2 - List 1 |
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Week 3 |
Session 1 - Subject 2 Session 2 - Subject 2 |
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Week 4 |
Session 1 - Subject 3 Session 2 - List 2 |
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Week 5 |
Session 1 - Subject 3 Session 2 - Subject 3 |
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Week 6 |
Session 1 - Subject 4 Session 2 - List 3 |
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Week 7 |
Session 1 - Subject 5 Session 2 - Subject 6 |
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Week 8 |
Session 1 - Subject 7 Session 2 - List 4 |
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Week 9 |
Session 1 - Subject 7 Session 2 - Subject 8 |
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Week 10 |
Session 1 - Subject 8 Session 2 - List 5 |
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