Accessibility statement

Monetary Economics - ECO00049H

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  • Department: Economics and Related Studies
  • Credit value: 20 credits
  • Credit level: H
  • Academic year of delivery: 2023-24
    • See module specification for other years: 2024-25

Module summary

This module enables third year undergraduate students to access a set of advanced topics in modern monetary theory.

Related modules

Pre-requisite modules

Co-requisite modules

  • None

Prohibited combinations

  • None

Module will run

Occurrence Teaching period
A Semester 2 2023-24

Module aims

The purpose of this advanced undergraduate module is to provide strong foundations in modern monetary theory so that students are able to appreciate the nuances of various policy debates.

Monetary Economics 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 generalized.

With that in hand, it proceeds to set up models 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 completed with either a general equilibrium focus or a game theoretic one.

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

Indicative assessment

Task % of module mark
Closed/in-person Exam (Centrally scheduled) 90
Essay/coursework 5
Essay/coursework 5

Special assessment rules

None

Indicative reassessment

Task % of module mark
Closed/in-person Exam (Centrally scheduled) 90

Module feedback

Feedback will be provided in line with University policy

Indicative reading

Champ, B. and Freeman, S., Modeling Monetary Economies, Cambridge, 2001


Freixas, X. and Rochet, J.-C., Microeconomics of Banking, MIT Press, 1997


The information on this page is indicative of the module that is currently on offer. The University constantly explores 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. In some instances it may be appropriate for the University to notify and consult with affected students about module changes in accordance with the University's policy on the Approval of Modifications to Existing Taught Programmes of Study.