Institutional Economics 2400-ZEWW915

The aim of this course is to introduce important ideas in New Institutional Economics, together with insights from micro- and macroeconomics, welfare economics, and development economics, that should enable students to answer the following questions:
What are institutions and how they impact market exchange?
What are transaction costs and how they are influenced by institutions?
How transaction costs affect contractual arrangements, in particular make-or-buy decisions?
To what extent institutions provide incentives (architecture of choice) for market participants?
The limits of vertical integration, or should the Bełchatów power plant own the Bełchatów lignite mine or should they be separate companies?
How regulations can help in coping with negative externalities in production?
The economics of climate change, or why reducing global CO2 emissions is so challenging?
Private companies and state-owned firms. Which form of ownership is “better”? And what “better” means?
These questions, as well as many others, will be covered to highlight specific examples of how institutions shape human behaviour, market outcomes, and contractual arrangements.
The classes will largely be conducted in the form of individual consultations with the lecturer, interspersed with lectures.