Subject: Economic Policy

Scientific Area:



80 Hours

Number of ECTS:

7,5 ECTS



Overall objectives:

1 - Students will be able to describe and use the main theoretical models of advanced undergraduate complexity, in the field of economic policy.
2 - Students will be able to develop a critical, comparative and quantitative analysis of the problems of modern economic policy.


1 - 1) Introduction to economic policy 1.1) Objective of economic policy 1.2) Variables of macroeconomics and economic policy 1.3) Main instruments of economic policy 1.4) Elements of international economic policy
2 - 2) Neoclassical and Keynesian economic policies 2.1) Elements of neoclassical economic policy 2.2) Elements of Keynesian economic policy
3 - 3) Economic policies in the neoclassical synthesis in a closed economy 3.1) Fiscal policy 3.2) Monetary policy 3.3) Wage policy
4 - 4) Economic policies in the neoclassical synthesis in an open economy 4.1) Current account and economic policies 4.2) Capital account and economic policies 4.3) Fiscal policy 4.4) Monetary policy 4.5) Exchange-rate policy
5 - 5) Economic policies in the AD-AS model 5.1) Economic policies and the Keynesian trade-off 5.2) Economic policies and monetarism 5.3) Economic policies and the new classical macroeconomics
6 - 6) Economic policies in the new Keynesian macroeconomics 6.1) Economic policies in the NAIRU model 6.2) Economic policies and hysteresis 6.3) Monetary policy and the Taylor rule
7 - 7) Economic policies in disequilibrium and post-Keynesian macroeconomics 7.1) Economic policies in the model of Barro and Grossman 7.2) Economic policies in the model of Davidson 7.3) Economic policies in the model of Lavoie 7.4) Economic policies in the model of Andini
8 - 8) Economic policies in the matching model 8.1) Economic policies, matching function and Beveridge curve 8.2) Economic policies and job-creation equation 8.3) Economic policies and wage-setting equation 8.4) Economic policies and equilibrium


Andini C. , 2016 , Teorias e Políticas Macroeconómicas , Universidade da Madeira
Lavoie M. , 2015 , Post-Keynesian Economics: New Foundations , Edward Elgar
Acocella N. , 1998 , The Foundations of Economic Policy: Values and Techniques , Cambridge University Press

Assesssment methods and criteria:

Classification Type: Quantitativa (0-20)

Evaluation Methodology:
The teaching methodology is mainly based on the oral and written transmission of knowledge from the instructor to the students during the contact hours. However, it also includes the analysis of case studies or problems as well as sessions to discuss practical applications of the theory. The materials most used for the transmission of knowledge are documents prepared by the instructor and websites. The assessment is periodical and consists of two mid-term exams. Each mid-term exam has a weight of 50%. All non mid-term exams have a weight of 100%.