Courses Master Display 2023-2024

Course Description To PDF
Course title Causes and Consequences of Systemic Risk
Course code EBC4273
ECTS credits 6,5
Assessment Whole/Half Grades
Period Start End Mon Tue Wed Thu Fri
2 30-10-2023 15-12-2023 X X
Level Intermediate/Advanced
Coordinator Peter Werner, Mark Sanders
For more information:;
Language of instruction English
The goal of this course is that students:
* understand the dynamics of cooperation in providing public goods and managing global commons;
* understand the nature and measurement of fundamental types of economic preferences (risk and time preferences) and their role for shaping policies related to global commons and systemic societal risks;
* can combine economic theory and empirical/experimental methods to assess the effectiveness of public policy/corporate strategy related to global commons and financial crisis;
* can operationalize this knowledge to design institutions and policy interventions to mitigate free-rider and moral hazard problems.
In this course, we analyze the central concepts that lead to problems of unsustainability and fragility. To let students experience how individual behavior can collectively drive people and systems towards unsustainable and vulnerable states, where common resources are exhausted and collapse, competition erodes redundancies and systemic risks build up, we start with playing the “fish bank” game. Subsequently, we introduce the concepts of risk versus uncertainty and move to dynamic intertemporal decision-making where issues like the appropriate discount rate, the budget constraint, and the formation of expectations emerge. Important concepts are asymmetric information, time inconsistency, self-fulfilling prophecies, and contagion. The course will then analyse how public and private risk management could be used to increase resilience and sustainability. The course will combine theoretical concepts with practical examples and empirical applications, which include preference elicitations, experimental methods, observational data, and statistical methods.
Scientific articles and chapters from books
Basic understanding of economic concepts and theories (both microeconomics and macroeconomics) is assumed.
Teaching methods (indicative; course manual is definitive) PBL / Presentation / Lecture / Assignment / Papers / Groupwork
Assessment methods (indicative; course manual is definitive) Final Paper / Presentation
Evaluation in previous academic year For the complete evaluation of this course please click "here"
This course belongs to the following programmes / specialisations
Master Economics - Inequality and Social Inclusion Elective Course(s)
Master Economics - Sustainable and Resilient Economies Core Course(s)
Master Economics - Technology, Markets, and Societal Change Elective Course(s)
Master Econometrics and Operations Research Elective Course(s)
Master Financial Economics - Asset Pricing Elective Course(s)
Master Financial Economics - Banking Elective Course(s)
Master Financial Economics - Financial Analysis Elective Course(s)
Master Financial Economics - No specialisation Elective Course(s)
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