POLITICAL ECONOMICS

This course will provide conceptual and analytical tools to understand the behavior of the main macroeconomic indicators, as demand, supply, output, inflation, employment, interest rates, and exchange rates. These tools are useful to investigate and describe relevant economic problems, especially related to the European Union. The tools can also be applied to understand the role of the economic and political institutions and to forecast the effects of their policy intervention. The goal of the course is training students to think in a structured and rigorous way about the main economic open questions.

1. Knowledge and understanding:
1.1. Understand the main aggregated economic indicators.
1.2. Understand the main agents interacting in the economy and the concept of macroeconomic equilibrium.
1.3. Understand the relation between the real and the financial/monetary sides of the economy.
1.4 Understand the different time ranges of the economic analysis

2. Ability to apply knowledge and understanding:
2.1. Use the main proposed models to compute the equilibrium solutions.
2.2. Use the main proposed models to perform what-if analysis about shocks affecting the economy or economic policies.
2.3. Recognize the limitations to the applicability of the studied tools.

3. Ability to judge:
3.1. Choosing the most suitable model to address a specific problem
3.2. Recognize the impact of different parametrizations on the equilibrium solution.
3.3. Judging the effective reliability of the obtained results.

Basic knowledge of Mathematics. In particular, it is necessary to understand the Cartesian system and to be able to solve systems of linear equations.

Demand and its elasticity
Supply and production costs
Economic equilibrium in perfect competition
Monopoly
Other forms of competition
The role of technology
Capitalism
Inequality
The environmental problem
Introduction to national accounts
The goods market
The financial market
The role of money
Overview of the IS-LM model
Fiscal and monetary policy
The open economy

Mankiw Gregory N., Mark P. Taylor, "Principi di economia", settima edizione, Zanichelli, 2018

The macroeconomics part might be integrated by O. Blanchard, "Macroeconomia", 5a or 6a edizione.

Written exam, duration around 120 minutes, with questions about theory (open questions or multiple choices) and exercises. The exam is passed obtaining 18 points. The value of each question is indicated in the exam.
The exam evaluates the knowledge and understanding of the fundamental concepts and models of the discipline presented in the teaching and the ability to analyze economic problems and to identify and interpret their solutions.

The course is divided into:
a) lectures
b) individual study

Italian

written