European political economy (POLITICĂ ȘI ECONOMIE - SP1 - RISE2)

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This course presents an introduction to European political economy to students completely new to the subject. The conversational yet precise style is superb for presenting the science of economic theories of EU politics and policy to tomorrow's decision-makers. The course is designed to provide students with a robust conceptual understanding of the subject using contemporary approaches to theory where possible. It stands out amongst all other introductory 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 daily lives. The course covers the most important topics in political economy while reflecting European economic structures and institutions and adapting the language and cultural references for 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 European Union policies. These features are apparent when dealing with the Common Agricultural Policy, the EU's external trade policy, competition policy, the taxation system, the monetary and financial system, common currency areas, and Economic and Monetary Union. 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 minimum price, a maximun price, a quota, or a subsidy; the effects of taxation and the design of optimal tax systems, market failure (imperfect competition, externatilies, public goods) and ways to deal with it, monetary policy, and fiscal policy in the EU. They should also be able to understand economic explanations of political processes such as voting, elections, lobbying, delegation, or EU treaty reform and enlargement.


1. Ten principles of economics. Thinking like an economist. Introduction to the scientific method. 2. Supply, demand, and government policies. Application to the EU's Common Agriculltural Policy. 3. The efficiency of markets and the costs of taxation. Application to the EU's Value Added Tax. 4. The efficiency of free trade and the costs of protection. Application to the EU's common commercial policy. 5. Market failure: externalities, public goods, monopoly. Application to selected EU policies. 6. Output, growth, employment, inflation, income distribution. Application to the EU. 7. Monetary policy. Application to the ECB and monetary policy in the Eurozone. 8. Fiscal policy. Application to fiscal policy in the EU. 9. Introduction to public choice I: spatial models of voting. Applications to the EU. 10. Introduction to public choice II: the subsidisation of bias. Application to EU elections and lobbying. 11. Introduction to public choice III: the principal-agent problem. Application to EU executive and judicial politics. 12. Introduction to public choice IV: the theory of clubs and the Exit-Voice-Loyalty (EVL) game. Application to EU deepening and widening, and Brexit. 13. Introduction to public choice V: selectorate theory. Application to EU foreign policy. 14. Conclusion. Special EUROSCI Lecture.

Indicative reading: 

Mankiw, N. G., & Taylor, M. P. (2014). Economics. 3rd ed. Boston: Cengage Learning.

Team members: 
Original title: 
Politică și economie
Course type: 
ECTS credits: