Micro and Macro Economics (for Public Policy)

This information is for the 2021/22 session.

Teacher responsible

Dr Ethan Ilzetzki and Professor Daniel Sturm


This course is compulsory on the Double Master of Public Administration (LSE-University of Toronto) and Master of Public Administration. This course is available on the MPA Dual Degree (LSE and Columbia), MPA Dual Degree (LSE and Hertie), MPA Dual Degree (LSE and NUS), MPA Dual Degree (LSE and Sciences Po), MPA Dual Degree (LSE and Tokyo) and MSc in Political Science and Political Economy. This course is available with permission as an outside option to students on other programmes where regulations permit.

Course content

This course is an introductory graduate course providing an economics background suitable for high-level public policy-making. The emphasis is on acquiring sound models and methods suitable for appraising policy-making issues in a wide variety of contexts. The first term (MT) covers microeconomics and the second term (LT) covers macroeconomics.

MT (Microeconomics): competitive markets and economic efficiency; consumer optimisation and the demand for goods; firm optimisation and the supply of goods; market power; externalities in consumption and production; optimal provision of public goods; and asymmetric information

LT (Macroeconomics): understanding macroeconomic data; long-run economic growth; business cycles; aggregate demand; money, inflation and monetary policy; stabilization policy;  fiscal policy and government debt; the labour market and unemployment; exchange rates and international economic policy; the financial system and the macroeconomy.


This course is delivered through a combination of classes and lectures totalling a minimum of 60 hours across Michaelmas Term and Lent Term and week 1 of Summer Term. This year teaching will be delivered through a combination of online lectures with classes taking place in person where possible and where conditions allow.

Formative coursework

Students will complete weekly problem sets. Some of these will be marked to provide indicative assessment.

Indicative reading

A full reading list will be distributed at the beginning of the course.


Exam (70%, duration: 3 hours, reading time: 15 minutes) in the summer exam period.
Policy memo (10%) in the MT.
Policy memo (10%) in the LT.
Continuous assessment (10%) in the MT and LT.

Course selection videos

Some departments have produced short videos to introduce their courses. Please refer to the course selection videos index page for further information.

Important information in response to COVID-19

Please note that during 2021/22 academic year some variation to teaching and learning activities may be required to respond to changes in public health advice and/or to account for the differing needs of students in attendance on campus and those who might be studying online. For example, this may involve changes to the mode of teaching delivery and/or the format or weighting of assessments. Changes will only be made if required and students will be notified about any changes to teaching or assessment plans at the earliest opportunity.

Key facts

Department: School of Public Policy

Total students 2020/21: 78

Average class size 2020/21: 13

Controlled access 2020/21: Yes

Value: One Unit

Guidelines for interpreting course guide information