ELE 3742 Market, crises and environment
The course addresses key themes and recurring issues in economic organization over the past 250 years. The starting point is Adam Smith's view of the market economy in his groundbreaking work The Wealth of Nations, published in 1776. Then will be presented what later economists have said about the same topic. The course's pervasive theme is the market economy's opportunities and problems related to business, government and the individual's role and behavior in society. Modern economic theory that also explain the functions of the markets from information conditions and psychological factors are also taken up.
How one can handle financial crises, environmental and resource challenges and unequal income distribution issues in a market economy will be also discussed in reation to the ideas that are presented in the course.
After completed course students should have:
- Obtained kowledge of what are the basic mechanisms of a market economy, as Smith described it.
- Become aware of the assumptions that lay behind Smith's model
- Acquired knowledge of the consequences of different production and consumer conditions for how a market economy works
- Acquired knowledge of the factors that can influence a market economy over time, especially the impact of new technology and other changes in production conditions, and income conditions and consumer habits
- Gained further knowledge of what should be the role of government in a market economy, including the hoe the resource and environmental challenges can be met in the best possible way.
- Learned about the role of information and communication for the market economy, including the effects of asymmetric information in markets.
- Learn about the assumptions about behavior behind our actions in the markets, including full and limited rationality and the role of economic and social incentives play.
After completed course students should be able to:
- Assess and discuss the market economy's strengths and weaknesses as seen from the point of wiev of different interests in society.
- Able to see the current economic problems and proposals and how these can be handled according to economic theory.
- Develop greater awareness of the importance of economic institutions, economic organization and economic behavior of the public sector, business and other organizations and individuals in the society.
- Develop the ability to utilize theory and practical knowledge in combination in order to reflect on what are the consequences for society, business and individuals of various forms of economic organization and human behavior in markets.
- Adam Smith. Invisible hand and the free market.
- David Ricardo, Thomas Malthus, John Stuart Mill free trade, protectionism and economic development
- Leon Walras, Catl Menger, Stanley Jevons, Alfred Marshal and Vilfredo Pareto: the neoclassical theory of perfect competition
- Thorstein Veblen and and John K Galbraith. The critique of neoclassical theory
- Joan Robinson and the theory of imperfect competition
- John Maynard Keynes' theory on crises and unemployment. Paul Krugman and The New Keynesian theory
- Karl Marx and Joseph Schumpeter's view of why crises occur.
- Alfred Pigou and recent environmental economists.
- Friedrich Hayek, Milton Friedman and the market-friendly economists in the postwar period
- Joseph Stiglitz and George Akerlof. Tthe consequence of the lack of information in the markets.
- Robert Shiller and Hyman Minky .The cause of the financial crisis in 2008.
- Daniel Kahneman. Bounded rationality.
The course will be conducted with a combination of 2 sessions á 6 hours, group projects, as well as guidance. In addition, there will be teaching on Itslearning where it will be online learning resources across all BI campuses.
The students will during the course work with practical / empirical issues and analyze them using theories and models of curriculum. There will be online activities and participation in online discussions.
As a means to promote motivation and learning teaching will be based on electronic folders and participation in the course.
Grade in the course is based on portfolio assessment. On Itslearning students develop a systematic set of assignments that show effort, process, progress, and reflection. At the end of the semester assignments from the portfolio must be printed and delivered for final grading. The final submission should include the following elements:
Final submission can be done individually or in groups of up to three students.
The exact date and exam for submissions / publications announced at course start.
For electives re-sit is normally offered at the next scheduled course. If an elective is discontinued or is not initiated in the semester it is offered, re-sit will be offered in the electives ordinary semester.
Higher Education Entrance Qualification.
No specific prerequisites is required.
|Exam category||Weight||Invigilation||Duration||Grouping||Comment exam|
Form of assessment:
Internal and external examiner
Examination when next scheduled course
|100||No||1 Semester(s)||Group/Individual ( 1 - 3 )|
|Form of assessment:||Written submission|
|Grouping (size):||Group/Individual (1-3)|
|Resit:||Examination when next scheduled course|
|Workload activity||Duration||Type of duration||Comment student effort|
|Teaching||12||Hour(s)||2 sessions á 6 hours|
|Prepare for teaching||75||Hour(s)|
|Comment:||2 sessions á 6 hours|
|Workload activity:||Prepare for teaching|
|Workload activity:||Self study|
A course of 1 ECTS credit corresponds to a workload of 26-30 hours. Therefore a course of 7,5 ECTS credit corresponds to a workload of at least 200 hours.
|Pressman, Steven||2014||Fifty major economists||3rd ed||Routledge|
|White, Lawrence H.||Introduction to The clash of economic ideas: the great policy debates and experiments of the last hundred years||Introduction to The clash of economic ideas: the great policy debates and experiments of the last hundred years||s. 1-11.|
|Stilwell, Frank J. B.||Why do economists disagree?||Why do economists disagree?||Kap. 39: s. 374-386.|
|Stilwell, Frank J. B.||Free-market economics||Free-market economics||Kap. 18: s. 150-160.|
|Cassidy, John||Adam Smith's invisible hand||Adam Smith's invisible hand||Kap. 2: s. 25-36.|
|Schlefer, Jonathan||The metaphor of the invisible hand||The metaphor of the invisible hand||Kap. 1: s. 1-23.|
|White, Lawrence H.||Free trade, protectionism, and trade deficits||Free trade, protectionism, and trade deficits||Kap. 14: s. 360-381.|
|Schlefer, Jonathan||This imperfect world||This imperfect world||Kap. 7: s. 93-98.|
|Stilwell, Frank J. B.||Market structures||Market structures||Kap. 21: s. 180-190.|
|Himmelweit, Susan; Simonetti, Roberto; Trigg, Andrew||Consumer dependency||Consumer dependency||Kap. 3: s. 59-83.|
|Stilwell, Frank J. B.||The disillusioned defence of capitalism||The disillusioned defence of capitalism||Kap. 29: s. 264-272.|
|Aliber, Robert Z.; Kindleberger, Charles P.||The anatomy of a typical crisis||The anatomy of a typical crisis||Kap. 2: s. 38-52.|
|Schlefer, Jonathan||Economies in crisis||Economies in crisis||Kap. 14: s. 238-255.|
|Smith, Stephen||The economic theory of efficient pollution control||The economic theory of efficient pollution control||Kap. 2: s. 14-27.|
|Bartelmus, Peter; Bartelmus, Arik||Introduction to Sustainability economics: an introduction||Introduction to Sustainability economics: an introduction||Kap. 1: s. 1-9.|
|Kay, John||Information||Information||Kap. 18: s. 212-223.|
|Kay, John||Risk in reality||Risk in reality||Kap. 19: s. 224-236.|
|Cassidy, John||Psychology returns to economics||Psychology returns to economics||Kap. 15: s. 192-204.|
|Akerlof, George A.; Shiller, Robert J.||Introduction to Animal spirits: how human psychology drives the economy and why it matters for global capitalism||Introduction to Animal spirits: how human psychology drives the economy and why it matters for global capitalism||s. 1-7.|
|Medema, Steven G.||The economic role of government in the history of economic thought||The economic role of government in the history of economic thought||Kap. 27: s. 428-444.|
|Harvey, David||The rise of neoliberal theory||The rise of neoliberal theory||s. 18-31.|
|Crouch, Colin||Neoliberalism: its origins and false start||Neoliberalism: its origins and false start||s. 2-23.|
|Kahneman, Daniel||Econs and humans||Econs and humans||s. 411-418.|
|Cassidy, John||Hidden information and the market for lemons||Hidden information and the market for lemons||Kap. 12: s. 151-165.|
|Akerlof, George A.; Shiller, Robert J.||Why do real estate markets go through cycles?||Why do real estate markets go through cycles?||Kap. 12: s. 149-156.|
|Ariely, Dan||The fallacy of supply and demand||The fallacy of supply and demand||Kap. 2: s. 23-48.|
|Krugman, Paul||How Did Economists Get It So Wrong?||How Did Economists Get It So Wrong?||Resource|