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. </p>