Introduction to Economic Theory

Students are introduced to the basic concepts and tools of microeconomic and macroeconomic analysis. 40% of the curriculum refers to microeconomics and 60% to macroeconomic analysis.

Specifically, in microeconomic analysis, the following topics will be covered:

• Basic economic concepts. Demand and supply of goods. The market system and the formation of prices. Elasticity of demand and supply.
• Consumer choices and the theory of demand for goods. Producer choices and bid decisions.
• Theory of production, cost and supply of goods in the short and long term. Forms of market and social well-being. Perfect competition, monopoly, oligopoly and monopoly competition.
• Competition, coordination and balance. The market mechanism and the logic of regulatory intervention by the state. Market imperfections and failures.

In macroeconomic analysis the following thematic sections are covered:

• The revenue stream and the system of national accounts categories. Product and total demand. Determination of income and total employment.
• Fiscal policy and multipliers.
• Money, banks and monetary policy.
• Inflation, unemployment and economic fluctuations.
• International trade, international economy and economic policy. Exchange rates, balance of payments and competitiveness. Economic development and growth.
• Stabilization policy (fiscal and monetary). Total supply, total demand and the concept of macroeconomic equilibrium. Determination of prices and wages and adaptation to short-term disorders (IS-LM model) and long-term (MDS-AS model).
• Economic dimensions of European integration. The Single Market. Economic and Monetary Union. European Central Bank, monetary policy framework. The effectiveness of monetary and fiscal policy in a single currency area.
• Financial crisis in Greece and the Eurozone. Balance of government budget, primary result and sustainability of public debt.