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Introduction to Economics and Finance

Our Introduction to Economics and Finance course will introduce you to exciting concepts in these disciplines, opening your mind to new ideas and will reflect the highest standards of Warwick learning.


We will cover a number of exciting and important topics that lie at the heart of economics and finance. In particular, you will be introduced to some of the key concepts and tools of game theory and behavioural economics.

These lie at the very core of economics - subjects that determine individual choice and collective choice, and in turn impact on the fundamental problem of economics, which is all about problems involving the allocation of scarce resources.

We will also introduce some of the burning issues concerning the world of money and banking, including some core ideas of finance and stock markets.

The political and social contexts matter for economic outcomes and we will touch on how and why that is so.

This course will show you how to think like an economist, and provide a perspective about the way economics is taught at the University level.



Haneen Fared

The quality of the lectures was excellent. Professor Abhinay always encouraged us to challenge him and present to him different opinions. Honestly speaking, after the programme I realised how much of an interest I have in Economics and now I'm even planning to become an Economist. Thank you for making it such a memorable experience for me.

    Haneen Fared (India)

    Teachers

     

    Teaching Assistants (tbc)

    Topics

    Game Theory and Strategic Thinking

    One of the biggest areas in economics is that of game theory and it is an area that can be applied to countless situations. Game theory is all about strategy and strategic thinking. Every day we have decisions to make and engage in economic interactions that involve some kind of trade. Understanding game theory can help consumers, firms, governments and society to make effective decisions. We’ll consider key concepts such as the Prisoner’s Dilemma and the Nash Equilibrium using applications to a variety of areas.


    Behavioural Economics

    Behavioural economics is one of the fastest growing branches of the discipline. We analyse how behavioural economics begins to move away from traditional theories and models, by relaxing some of our traditional assumptions. By doing this, behavioural economics looks to explain how agents actually behave in practice and what factors can sometimes explain seemingly irrational behaviour. The course will expose students to several major topics in behavioural economics and will look to link theory with empirical applications. We will analyse the role of behavioural economics in the context of both consumer and firm behaviour.


    Money, Banking and Stock Markets

    We will start by asking the simple question above: what is money? The answer is much more complicated than the question and we will begin by looking at the role of money within an economy. There are many uses and purposes of holding money and we will consider why a currency is actually needed and what it allows consumers, investors and governments to do. We will take a closer look at the banking system and provide an understanding of the workings of the financial sector.

    Trillions of dollars is traded every day on the largest stock exchanges. Millions can be wiped off or added to companies within a few hours as shares change hands. We will consider the workings of the stock market, looking at the demand and supply of shares and why individuals and firm choose to hold some of their money as a paper asset, buying shares in a company. We will look at methods of measuring the value of a company and how technological changes have helped to improve the transmission of information across the largest stock exchanges and the implication for traders.


    What is Economics? The Science of Choice

    Economics is everywhere and can be applied to everything and we will look to show you some of the traditional and more diverse areas where economics is relevant. There are some important principles of economics and the key to understanding any concept where we can apply economics is to first understand the main economic problem: scarcity. We have infinite wants and finite resources and this problem leads to choices and trade-offs. We will be looking at the problems and questions that emerge because of the economic problem and explaining some of the key concepts that underlie all economic thinking, teaching you exactly what it means to 'think like an economist’.


    Macroeconomics and the Global Economy

    We will look at the functioning of markets and consider how equilibrium prices and quantities are determined in a variety of cases. We will consider when markets allocate resources efficiently and if they don’t what causes the market failure. Topics will include externalities, monopoly power, imperfect information, public goods and the tragedy of the commons. This then leads to questions of the role of government and we will consider the effectiveness of government policy in a variety of areas, such as health care, education, housing and food.

    The Financial Crisis – we will look at the biggest financial event in decades that affected countries, firms and consumers across the world. We will discuss the background to the financial crisis and gain an understanding of the factors that created such a volatile banking system. By looking at some key markets, such as housing, construction, stocks and shares, we will analyse the impact of the financial crisis on the wider economy, consumers, investors and firms. We will bring in some key macroeconomic variables, such as interest rates and discuss government policy in countries around the world, thinking about their effectiveness in try to stabilise a vulnerable global economy.


    Introduction to Finance

    We will start by asking the simple question what is money? The answer is much more complicated than the question and we will begin by looking at the role of money within an economy. There are many uses and purposes of holding money and we will consider why a currency is actually needed and what it allows consumers, investors and governments to do. We will take a closer look at the banking system and provide an understanding of the workings of the financial sector.

    The Stock Market - trillions of dollars are traded every day on the largest stock exchanges. Millions can be wiped off or added to companies within a few hours as shares change hands. We will consider the workings of the stock market, looking at the demand and supply of shares and why individuals and firm choose to hold some of their money as a paper asset, buying shares in a company. We will look at methods of measuring the value of a company and how technological changes have helped to improve the transmission of information across the largest stock exchanges and the implication for traders.

    Investment - investment depends on many factors and we will analyse some of the key determinants of investment and how individuals will look at the macroeconomy when making investment decisions. We will also consider the decision-making of firms and how they decide to grow based on changes in the macroeconomy and the role of mergers and take-overs. This topic will give students an understanding of the wider economy and the impact this has on the flow of finance.


    Economic History, Institutions and where we are today

    The final topic of this course will be to consider the institutions that currently exist and take a closer look at how we have got to where we are today. This will involve some economic history, but will really look at the way in which economies have developed and the changes that we have observed and that still need to happen.