Course ObjectiveUpon completion of this course, students will:
• understand the interrelation between markets, market failures,
transaction costs and institutions;
• understand how transaction costs influence economic policy making in
• be able to apply the transaction-cost approach to explain real life
institutions and policy;
• understand the interdisciplinary linkages between politics and
economics in disciplines such as political economy and public choice;
• understand the role of politics in economic policy making in society.
Course ContentThe course provides an improved understanding of the politics of
economic policy making in the face of markets and market failures. The
conceptual framework used is the so-called ‘transaction-cost approach’.
Such costs of planning, implementing and monitoring an exchange have
proved critical to explaining many phenomena in the economic disciplines
of industrial organization, international trade theory and institutional
economics. This interdisciplinary course analyzes a variety of similar
transaction costs encountered in the political process of economic
policy making. Students will look into specific examples of policymaking
where the transaction-cost approach helps explain the operation of
different institutions and policies.
The course includes a language component that focuses on aspects of
coherence and economy of expression. In addition, practice is given on
conference presentation techniques.
Teaching MethodsLectures and seminars (active learning groups).
Method of AssessmentExam (50%)
Group policy project paper (50%)
Linguistic, structural and coherence-related aspects of group policy
project paper [where each individual contribution is specified]
LiteratureThe Making of Economic Policy: A Transaction-Cost Politics Perspective
by Avinash K. Dixit, MIT Press paperback edition, 1999, ISBN:
978-0-262-54098-8 + selected readings (to be announced)
Target AudienceSecond year PPE students
Additional InformationParticipation in seminars is mandatory
Custom Course RegistrationThere is a slightly different enrollment procedure for this module. The standard procedure of the Faculty of Humanities has students sign up for (i) the module, (ii) the form of tuition (lecture and/or preferred seminar group), and (iii) the exam. However, for this module the instructor will assign the students to the seminar groups. Therefore, students should sign up for (i) the module and (ii) lecture, but not for the seminar groups.
Recommended background knowledgePPE in Practice I & PPE in Practice II
|Language of Tuition||English|
|Faculty||Faculty of Humanities|
|Course Coordinator||dr. R.I. Luttens|
|Examiner||dr. R.I. Luttens|
dr. R.I. Luttens
You need to register for this course yourself
Last-minute registration is available for this course.
|Teaching Methods||Lecture, Seminar*|
*You cannot select a group yourself for this teaching method, you will be placed in a group.
This course is also available as: