Economics: The State and the Market

<p>Why does the market function well in some cases, yet fail to deliver the outcomes we desire in others? In this course, you will gain a deeper understanding of the market economy, with particular emphasis on situations where the market produces results that differ from what society intends.</p><p>This course builds on the module “The Market - Prices, Consumers and Firms.” You will explore the role of the state and the public sector in the economy, with a focus on market failures. You will learn to analyse situations where markets do not function efficiently, such as:</p><ul><li>External effects (for example, environmental emissions)</li><li>Information asymmetries (where consumers lack sufficient information to make rational decisions)</li><li>Public goods (for example, the justice system)</li><li>Monopolies</li></ul><p><br/></p><p>Through theoretical models and practical examples, you will gain insight into how government interventions—such as taxes, subsidies and regulations - can correct these failures and promote social welfare. You will also examine collective decision-making processes to understand how the state itself may fail to address market inefficiencies.</p><p>The course further provides insights into key topics such as welfare economics, cost-benefit analysis in public investment, and policy design. You will study materials that combine classical economic theories with modern applications and articles on current policy issues. An assessed assignment offers the opportunity to apply these theories to real-world problems, such as environmental policy or healthcare reforms.</p>