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OAFP 4745 - Economic Policy

Type d'enseignement : Elective

Semester : Autumn 2018-2019

Number of hours : 24

Language of tuition : English



Course Description

Scope and content: The course illustrates how economic theory informs decision-making and provides a structured approach to today's key policy challenges in advanced and emerging market economies, with a focus on Europe. Its aim is to help students build bridges between theoretical and empirical research and the daily life of policy making in ministries of finance, central banks and international organisations. The six sessions cover the macroeconomy in a broad sense: fiscal policy, monetary policy, financial stability, international capital flows and exchange rates, inequalities and taxation. Across policy domains, the method is the same: start from stylised facts, pick relevant analytical tools to assess policy options, and remain mindful of the institutional context and political economy. Material: For each session, draft textbook chapter, lecture slides, and a list of recommended reading will be made available on the Sciences Po Moodle. Format: The course is organised as a seminar. Participation and initiative are highly encouraged and part of the grading (see below). Controversy is valued, if well argumented. The introductory session set apart, classes No. 2 to 6 are divided into two parts of roughly equal length: ▪ Part 1 is a debate on issues of interest to the topic of the class. Before each session, I will circulate a small number of themes/questions and indicative references. Students are expected to pick one of the themes (or go for their own theme if so preferred) and prepare and circulate in advance a one-pager giving their ex-ante view. As much as possible, this view should be rooted in economy theory and informed by facts. ▪ Part 2 is a lecture where I come back to the main facts, theories and policy issues based on the initial discussion. Lecture slides will be uploaded in advance. A wrap-up discussion will compare ex-ante and ex-post views. As J.M. Keynes famously said: “When the facts change, I change my mind; What do you do, Sir?”. Final essay: Each student must produce a final essay of maximum 3000 words (plus tables, charts and references). The essay should be a structured discussion falling within one of the domains covered by the course. It can be centred on a live policy issue (e.g. Has post-crisis financial regulatory reform delivered on its promises? Does the euro area need a central fiscal capacity? Should one create a universal basic income? etc.) or on a recent academic contribution. Essays devoted to a policy issue should start from facts/data, relate the issue to available theory, and outline clear policy conclusions. Essays devoted to an academic article should put it in its theoretical context, explain and challenge the modelling strategy, and draw policy lessons from the article's findings.


COEURE, Benoit (Membre du Directoire de la Banque centrale européenne)

Course validation

Grading will be based 50% on the one-pagers and overall course participation, and 50% on the final essay. Attendance is subject to Sciences Po rules