Positive political economy
Economics, economic policy and public choice
This course introduces political economy to students completely new to the subject. The conversational yet precise style of this course is an excellent way of presenting the science of economics, economic policy and public choice to tomorrow's decision makers. The course is designed to provide students with a sound conceptual understanding of the subject using contemporary examples where possible. It stands out amongst all other introductory economics courses by stressing the fact that economic processes do not take place in isolation from social and political processes and by encouraging students to apply an economic way of thinking in their analysis of political processes. The course covers the most important topics in political economy while reflecting European economic structures and institutions and adapting the language and cultural references to a European audience. For instance, the euro is the basic currency referred to throughout the course, and case studies and examples largely refer to the European economy and EU policies. These features are apparent when dealing with the EU's common agricultural policy, external trade policy, competition policy, VAT, the euro and ECB monetary policy. By the end of the course, students should be able to understand the effects on markets of government policies such as a the establishment of a minimum price, a price ceiling, a quota, or a subsidy; the effects of taxation and the design of optimal tax systems, market failure (monopoly, externatilies, public goods) and ways to deal with it, macroeconomic data, economic growth, monetary policy, and fiscal policy. They should also be acquainted with the political conflicts related to economic policy and economic explanations of policy making.
Mankiw, N. G. (2020). Principles of economics, 9th ed. Cengage learning. Previous editions of the book are OK.