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EC260: The Political Economy of Public Policy


Course Content

Does democracy promote economic growth and welfare? What determines the size and evolution of the welfare state? Is regulation done in the interest of consumers? Is there a feasible third way between markets and governments in the delivering of public services? To answer these and many related questions it is necessary to understand the complex relationships between politics and economics.

Governments and political processes define the boundaries of economic relationships and the rules of market interactions. Moreover, governments themselves allocate resources and these allocations reflect complex political bargaining. Understanding the interaction between politics and economics can help us to gain insight into the key questions of public policy making.

Topics covered include:

  • Introduction to political economy
  • Public goods and the collective action problem
  • Elections and public policy. Majority rule
  • The political economy of inequality and redistribution.
  • Political agency
  • Organisation of legislatures and legislative procedures
  • Interest groups
  • Political leadership
  • The origins and effects of political institutions
  • Information, mass media and public policy
  • Electoral rules and policy outcomes

Course outcomes

This course enhances a student’s understanding of the characteristics, determinants and consequences of public-policy making in liberal democracies.

It provides theoretical foundations from both economics and political science, whilst developing an expansive knowledge of theoretical and applied areas of political economy. 

World-class LSE teaching             

The LSE Department of Economics is one of the biggest and best in the world, with expertise across the full spectrum of mainstream economics. A long-standing commitment to remaining at the cutting edge of developments in the field has ensured the lasting impact of its work on the discipline as a whole.

It is a leading research department, consistently ranked in the top 20 economics departments worldwide. This is reflected in the 2014 Research Assessment exercise which recognised the Department's outstanding contribution to the field

On this three week intensive programme, you will engage with and learn from full-time lecturers from the LSE’s economics faculty.



K. Shepsle, Analyzing Politics, London: W.W. Norton (2010) 

*A more detailed reading list will be supplied prior to the start of the programme

**Course content, faculty and dates may be subject to change without prior notice



Session: Two

Dates: 10 - 28 July 2017

Professor Torun Dewan
Professor Valentino Larcinese

Level: 200 level

Fees: Click here for information

Prerequisites: Introductory microeconomics, basic knowledge of calculus and statistics

Lectures: 36 hours 

Classes: 18 hours

Assessment*: One piece of written work and one written examination

Typical credit**: 3-4 credits (US)
7.5 ECTS points (EU)

How to apply?

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*assessment is optional – see FAQs

**You will need to check with your home institution. Read more about credit transfer here.