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Monetary Economics - ECO00010H

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  • Department: Economics and Related Studies
  • Module co-ordinator: Prof. Subir Chattopadhyay
  • Credit value: 20 credits
  • Credit level: H
  • Academic year of delivery: 2018-19

Related modules

Co-requisite modules

  • None

Prohibited combinations

  • None

Module will run

Occurrence Teaching cycle
A Autumn Term 2018-19 to Spring Term 2018-19

Module aims

Macroeconomics II introduced models of money, both money demand and money supply, and showed how a central bank operates and how monetary policy affects the economy.
Monetary Economics takes a different approach to some of those issues. It builds on models of individual behaviour to develop a model that is well understood - the perfectly competitive model - where there are no frictions, resources are allocated efficiently and there is no role for money. It then identifies the key elements of that model and specifies the extent to which it can be generalised.
With that in hand, it proceeds to set up models, always with foundations in microeconomics, that have certain imperfections and thereby generate a role for money and monetary policy. Specifically, it considers the importance of expectations, liquidity constraints, missing markets, uncertainty, imperfect information and enforceability. It also studies certain aspects of central banking and policy. All the models developed have foundations in microeconomics.

Module learning outcomes

On completing the module a student will be able to understand:

  • When there is a role for money
  • Some aspects of monetary policy that are related to the optimum quantity of money
  • Some aspects of liquidity


Task Length % of module mark
University - closed examination
Monetary Economics
3 hours 100

Special assessment rules



Task Length % of module mark
University - closed examination
Monetary Economics
3 hours 100

Module feedback

Information currently unavailable

Indicative reading

Lecture Notes and some chapters or sections from:

  • Champ, B. & Freeman, S. (2001). Modelling Monetary Economies. Cambridge.
  • Freixas, X. & Rochet, J C. (1997). Microeconomics of Banking. MIT Press.

The information on this page is indicative of the module that is currently on offer. The University is constantly exploring ways to enhance and improve its degree programmes and therefore reserves the right to make variations to the content and method of delivery of modules, and to discontinue modules, if such action is reasonably considered to be necessary by the University. Where appropriate, the University will notify and consult with affected students in advance about any changes that are required in line with the University's policy on the Approval of Modifications to Existing Taught Programmes of Study.

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