About this course: This course will employ a non-technical approach to analyze how governments use policy to influence a country's economy. Upon completing the course you should be able to discuss national debts and deficits, examine fiscal and monetary policy and their appropriateness to the situation of an economy, and anticipate the results of fiscal and monetary policies and structural reform on a country. These concepts will give you the tools to develop your own position in many current economic debates, such as fiscal stimulus vs. austerity, the merits of quantitative easing, the need for higher interest rates or the future growth path of many modern economies.
Created by: IE Business School
Taught by: Gayle Allard
| Commitment | 8 hours |
| Language | English, Subtitles: Spanish, Turkish |
| How To Pass | Pass all graded assignments to complete the course. |
| User Ratings |
Syllabus
WEEK 1
Macroeconomy Overview
We are surrounded by news and commentary on the macroeconomy. To understand it, we need to grasp the meaning of GDP, inflation and unemployment and see what their “normal” levels are and how they relate to one another. Though these levels and relationships are far from mechanical, they provide an essential foundation to understanding what governments are doing in a macroeconomy.
11 videos, 4 readings
- Video: Introduction: Module 1
- Reading: Syllabus: Module 1
- Reading: Grading Policy
- Reading: Course Staff
- Reading: Contact Us
- Video: What is GDP - The Circular Flow Diagram
- Video: Potential GDP as a Reference Point for the Business Cycle
- Video: GDP Gaps and Policymaking
- Video: What Does a Business Cycle Look Like?
- Video: What Drives the Business Cycle - Aggregate Supply and Aggregate Demand
- Video: Aggregate Supply and Aggregate Demand II
- Video: Aggregate Supply and Aggregate Demand III: Shifts in Aggregate Demand
- Video: Aggregate Supply and Aggregate Demand IV: Shifts in Aggregate Supply
- Video: GDP Growth in the Real World and Future Prospects
- Video: Conclusion: Module One
Graded: Macroeconomy Quiz
WEEK 2
The Fiscal Policy Tool
Welcome to Module 2! We will be going into fiscal policy, which is one of the key tools that authorities have to influence the economy and bring GDP closer to its ideal growth rate. It consists of changes in government spending and taxes. To try to gauge how much spending and taxes need to change to bring GDP to potential, we use two concepts: the multiplier, and crowding out. However, spending and tax revenues also move automatically across the business cycle, helping make the economy more stable. Thanks for being with us! Enjoy learning!
7 videos, 1 reading
- Video: Introduction: Module 2
- Reading: Syllabus: Module 2
- Video: Restrictive and Expansive Fiscal Policy Tools
- Video: The Multiplier Effect of Fiscal Policy
- Video: Crowding Out
- Video: Automatic Stabilizers
- Video: Fiscal Policy in the Real World
- Video: Conclusion: Module Two
Graded: Fiscal Policy Tool Quiz
WEEK 3
Deficits, Debts, Myths and Realities
Welcome to Module 3!
Now we know how fiscal policy is supposed to work in the economy, to close recessionary or inflationary gaps. In this module we will get into the nuts and bolts of deficits and debts in the real world and I am sure we will have some interesting follow-up discussions! How is it really used? What are government deficits and debts? When governments run deficits and need to borrow money, how and where do they do it? When are these deficits and debts more of a problem? This module will look at the US and other leading economies in recent years to answer these questions, clear up some common misconceptions, and point to what the most important concerns are with deficits and debts at the present time.
Good luck and see you online!
10 videos, 1 reading
- Video: Introduction: Module Three
- Reading: Syllabus: Module 3
- Video: Government Deficits and Surpluses
- Video: How Do Governments Borrow Money? (I)
- Video: How Do Governments Borrow Money? (II)
- Video: Who Owns Public Debt in Advanced Economies?
- Video: How Much Deficit is Too Much?
- Video: US Debt
- Video: Strengths and Weaknesses of Fiscal Policy
- Video: Conclusion: Module Three
- Video: Office Hours Modules 1 to 3
Graded: Deficits, Debts, Myths and Realities Quiz
WEEK 4
Monetary Policy
Welcome to Module 4!
This week we're tackling a fascinating issue, which is monetary policy, and I anticipate some very interesting debates. Monetary policy is the other main tool that governments can use to influence the economy. Monetary authorities work through the money supply and can use open market operations, their own lending rates and reserve or cash ratios to influence money markets and hence the real economy. Just as with fiscal policy, once the gap in the economy is identified, expansive monetary policy should be used in a recessionary gap and restrictive monetary policy in an inflationary gap. Monetary policy is superior to fiscal policy in many ways, but its greatest weakness is that it does not work nearly as well in recessionary gaps as in inflationary gaps.
Keep up the good work!
7 videos, 1 reading
- Video: Introduction: Module Four
- Reading: Syllabus: Module 4
- Video: What is Money and What are Central Banks
- Video: Central Banks in the World
- Video: What are the Tools of Central Banks?
- Video: How Does Monetary Policy Work Across the cycle and Why Does it Sometimes Fail?
- Video: Strengths and Weaknesses of Monetary Policy
- Video: Conclusion: Module Four
Graded: Monetary Policy Quiz
WEEK 5
Combining Policies and Other Policy Tools
Welcome, Courserians, to our fifth module in the Understanding Economic Policy course! We have so many tools in hand now that we can spend our last sessions putting the pieces together and tackling real-world policy questions. There is little that could be more relevant, and I hope you will enjoy it. In the real world, fiscal and monetary authorities may move in the same policy directions or they may act in opposition to one another. We will explore what happens as fiscal and monetary policies interact in the real economy. Additionally, economic decision-makers have two other policies that they can use to influence the economy, which are exchange-rate policy and structural policy. We will discuss how these work, and what special complications and advantages they present. There is also a peer-evaluated assignment for this course, and it’s included in this module. You will use the Economic Policy Simulator, a free interactive exercise, to make policy for an unknown country. Use all of the tools that we have learned together, and enjoy getting a chance to run a country! Thanks for your enthusiastic participation, and enjoy these last two modules of the course!
8 videos, 1 reading
- Video: Introduction: Module Five
- Reading: Syllabus: Module 5
- Video: How Do Different Combinations of These Policies Affect the Macroeconomy?
- Video: Policy Mixes and Outcomes
- Video: Exchange Rates
- Video: Structural Policy
- Video: Policy Mix in the Real World
- Video: Practicing Policymaking with the Economic Policy Simulator
- Video: Conclusion: Module Five
Graded: Combining Policies and Other Policy Tools Quiz
Graded: Peer Graded Assignment - Economic Policy Simulator
WEEK 6
Policymaking in the Wake of the Financial Crisis
You are now in the last module of our Understanding Economic Policymaking course! Having reviewed the theory behind economic policymaking, we devote the last module to discovering what policymakers are actually doing in the leading developed countries of the world. We will discuss whether interest rates have been appropriate in a group of countries, and what the consequences are if they are not. We will also discuss quantitative easing, the main “unconventional” monetary policy, and anticipate some of its consequences. We will have a look at deficits and debt in some countries and use the tools to determine whether they are problematic; we will analyze the “austerity” policies applied in many European countries; and we will have a look at the combination of fiscal, monetary and structural policies being used in Japan, dubbed “Abenomics”. We´ll also consider the perils of policymakers´ aggressive pursuit of growth at a time when it is becoming more elusive. The final exam will have questions from this module and from each of the previous modules, so you can study your earlier quizzes to prepare. Good luck as you complete the course! I´ve enjoyed getting to know you a little. Warm regards.
9 videos, 1 reading
- Video: Introduction: Module Six
- Reading: Syllabus: Module 6
- Video: Monetary Policy in the United States
- Video: Monetary Policy in Spain and Germany
- Video: Quantitative Easing
- Video: Fiscal Policy in the Real World: When is Debt Too High?
- Video: Abenomics
- Video: Policy and the Eternal Pursuit of Growth
- Video: Summary of the Course
- Video: Extra: The situation in Greece
Graded: Final Exam
FAQs
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IE Business School
IE Business School is an internationally recognized business school where the leaders of tomorrow shape their ideas and learn to become global citizens. For over 40 years, IE Business School has promoted innovation and change in organizations, equipping managers with an entrepreneurial mindset that generates employment, wealth, and social well-being.
Regularly featured among the top business schools in the world, IE Business School has an urban campus in Madrid and a faculty of more than 400 professors who teach students from approximately 90 countries in its undergraduate and master programs. IE uses innovative online, face-to-face, and blended learning formats, including the IE Communities Platform where knowledge and experiences are exchanged with over 50,000 IE graduates that currently hold management positions in more than 100 countries worldwide.
Pricing
| Purchase Course | Audit | |
|---|---|---|
| Access to course materials | Available | Available |
| Access to graded materials | Available | Not available |
| Receive a final grade | Available | Not available |
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Ratings and Reviews
# Allard's Understanding Economic Policy making
Working through this course was a delightful experience!
With little background in economics, I got into this to get a strong grip on key macroeconomic concepts and make sense of economic policies in my country (India). This one course exceeded my expectations!
She has a very clear instruction style and the course material (ebook) also helps in developing a solid foundation of the fundamental topics.
My only suggestion would be to throw in a few more quantitative exercises more frequently as part of the weekly assignments.
With my interests in public policy, I look forward to doing more courses in the area of public / urban / land economics. Coursera guys, hope you keep adding more of such great courses in the mentioned areas.
Thanks
Aman Trehan
New Delhi
The Basics of Economics explained in a very simple way. Thank u Coursera
Professor Allard Explains things in a pellucid way .She's got that gift of gab .Once you successfully finish the course ,policy news are no more alien terms to you. Thanks Much Professor
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jc
This was an excellent course for me. It has enabled me make sense of economic data, and aroused my interest to go further and study more. Thank you for offering this course. It has been a wonderful experience this far.