Department of Economics

Faculty of Arts and Social Sciences

Master of Economics *

Career-Oriented Track: Applied Economics

This track is for students who wish to become professional economists or economic consultants, or who wish to work for government agencies. It is designed for students who wish to apply economics to a wide range of challenging situations facing firms, policymakers, and other stakeholders. The programme, which has an applied orientation, requires students to take core theory courses and modules in various areas such as financial economics, economic data analytics, behavioral economics, economic policies, and international economics.

Curriculum for Master of Economics (Applied Economics)

The graduation requirement for the career-oriented track is TEN modules. Of the ten modules, THREE will be core foundation modules that are required for all students. The students are free to choose the other SEVEN elective modules.

Core compulsory modules*

This course is designed to provide students with a sound understanding of modern microeconomic theory. It will cover the aspects of microeconomic theory that are required to analyse contemporary economics issues and to create new models to explain the behaviour of individuals, firms, and markets, and to evaluate economic policies. The topics will include consumer and producer theories, analysis of risk and uncertainty, game theory and its applications in economics, general equilibrium, market failure and welfare economics. The course considers the problem of incomplete and asymmetric information in market interactions, including the issues of moral hazard, adverse selection, and signalling. The impact of government policies on economic activities will also be examined.

This subject covers topics in modern Macroeconomic Theory and Policy at the advanced level. The emphasis will be laid on recent advances in the theories about long-term growth and short-term business cycles, and in the related empirical and policy debates. The growth theory includes neoclassical growth models (particularly the Ramsey and overlapping-generations models), and various endogenous growth models with knowledge spillovers, human capital and R&D investment. We also consider income distribution, convergence, income ranking, and population ageing in the growth models. The business cycle theory includes the real-business cycle model and various New Keynesian models. The policy issues include national debt, social security, and monetary policies. It helps students understand the frontier debates in macroeconomics.

This is an applications-oriented introductory level module for students who do not have a sufficient training in econometrics. Students who have already completed modules at this level can opt for higher level econometric modules. Students will be provided with hands-on training in computer software such as SAS, EViews and Excel. The module covers probability distributions and statistical inference, matrix algebra, simple and multiple linear regression models, diagnostic testing, dummy variable regressions, time series econometrics including cointegration and error correction models.

Elective modules

The purpose of this course is to make in-depth analysis and understand various theoretical issues of modern industrial organisation. The approach of this course is game theoretic. In the beginning, basic concepts of non-cooperative game theory are reviewed in detail. This lays the foundation to study various applications of game theoretic models in the field of industrial organisation. The course is aimed for Masters’ students and researchers in Economics interested in the area of Industrial Organisation.

This course surveys and studies the various theories of international trade and applies them to the analysis of current trade problems. The topics covered include theories explaining trade patterns, the effect of trade on national welfare and welfare of groups within a country, trade policy, international economic integration and so on. The target group of students is those who have background in Economics and would like to have more in-depth knowledge of trade theories and current trade problems.

This module is mainly concerned with the operation of international finance markets, focusing on those for spot exchange rates and their derivatives, Eurocurrencies, Eurobonds, the behaviour and the determination of exchange rates, the management of risk and investment in an international setting. The intent is to investigate how various financial instruments are used for hedging and speculating in the currency markets and how economic theories are applied to determine the equilibrium exchange rates. Some policy issues concerning the recent world financial market turbulence will also be discussed.

This module applies economic principles to analyse budgetary policies and programmes of the public sectors. Topics covered include the following: the economic role of the state; the privatisation phenomenon; theory and practice of tax reform; effects of taxes and expenditure on work effort, saving, investment and risk taking; the role of fiscal incentives in economic management; financing of social security, health care and education and; international aspects of taxation.

This module provides an introduction to machine learning and data mining methods for economics problems. The module will explain the core concept of well-known supervised learning algorithms including decision trees, neural networks, and support vector machines. Differences between these methods and econometrics methods will be discussed. This module will move on to explain unsupervised learning methods. Emerging topics, such as time series data mining, text mining or other methods for unstructured data mining, will also be covered. Examples, assignments, and the final project will be designed to help students learn using machine learning techniques to complement traditional econometrics analysis.

This module is designed to cover topics that are not covered under ECA5103 Quantitative and Computing Methods. Topics such as Bayesian econometrics, microeconometrics, panel regressions, limited dependent variable models, simultaneous equations models and macroeconometric modelling for forecasting and policy analyses are likely to be covered under this module.

This module is designed to provide students with vigorous training in applied financial econometrics. It covers topics on characteristics of macroeconomic and financial data; basic concepts of linear and non-linear time series models: stationary time series models, ARMA models; stochastic volatility models; GARCH models and diagnostic tests; value at risk analysis; and multivariate conditional time-varying models. Students are expected to do several computer-based projects.

This module emphasises applied cost-benefit analysis. The module examines the theoretically correct approaches in the key areas and then focuses on the methods and practices in the application of cost-benefit analysis. Topics include investment criteria in the public sector, risk and uncertainty, valuing and identifying costs and benefits, shadow pricing, and the social rate of discount. In addition, students are expected to use cost-benefit analysis in a number of actual case studies.

This module aims to provide an understanding of some of the major issues in international finance. The module focuses especially on the policy-oriented aspects of the issues. Topics covered include the interdependence of fiscal, monetary and exchange rate policies, international capital movements, foreign exchange rate determination, European monetary integration, and the Euro, and international coordination of economic policies. A combined reading list of books and articles in this module will be distributed during the lectures.

This module is to offer a broad overview of financial assets traded in the money, options, and stock markets. It includes valuation of bonds and securities, analysis of options and futures contracts, asset pricing models and some applications.

This module provides a theoretical and practical treatment of corporate financial theory for students who have completed an introductory course in financial economics. Topics covered in this course will include: an overview of financial management; comparisons of financial and real investment; capital budgeting and valuing real assets and real options; risk and return of assets; capital structure and dividend policy, and mergers and acquisitions; applications of portfolio management techniques in corporate finance.

The module provides an in-depth analysis of the theories and models that are essential to the understanding of contingent claims. The course covers topics on mathematics of financial derivatives, stochastic models of securities price movements, Black-Scholes analysis and risk-neutral valuation, analytical and numerical procedures for various option-embedded products. Students reading this module are expected to have some basic knowledge of options and futures.

This module studies the stock performance in world stock markets by using different approaches such as fundamental analysis, technical analysis, stock market imperfections and investors’ behaviour, stock market information and events, etc. This module also studies the various models for stock returns as well as the viewpoints from theoreticians and practitioners in stock markets analyses. Certain traditional approaches to analyse stock market will be introduced. Students are required to read widely the literature and the current issues and research in order to have a better understanding of world stock market studies.

The module studies how trading takes place in financial markets. We cover theoretical models and the associated empirical analysis employing game theory and econometric theory. We first analyse the movement of security prices by time series models. Second, we investigate various trading strategies adopted by market participants. To understand increasingly popular computerized trading, we cover programming and econometric software such as Excel VBA and R. Then, we examine three main types of theoretical models of trading: inventory models, sequential trading models, and strategic trading models. Finally, we study how trading rules and institutional details may lead to different trading processes. We expect the course will equip the students with skills for understanding and analysing how financial market works in both theory and practice. Students are expected to conduct empirical analysis with high frequency data to explain market outcomes. After the course, students should have a good understanding how trading rules may lead to different trading outcomes; and how people actually trade in financial market in real time. In particular, students will understand how the working process of a market affects the determinants of transaction costs, price, quotes, volumes and trading behaviour.

This is a Masters' level course on international trade and finance, open to both economics and non-economics graduate students. In the first half of the course, we will examine theories and empirics of trade, including Ricardian, Heckscher-Ohlin theories, and theories of trade under increasing returns, welfare implications of trade policy, and the political economy of trade policies. The second and monetary half of the course will focus on balance of payments, foreign exchange markets and open-economy macroeconomic policies. An emphasis will be placed on the implications of the theories and empirics for policy discussion.

The main objective of the module is to gain appreciation of how economic theory can be used to analyse both the individual components of the fiscal system, such as effects of various taxes and expenditures, as well as the size and the behaviour of the government sector itself. The module encompasses the traditional, public choice and supply side approaches. While the main focus is on partial equilibrium analysis, wherever feasible or relevant, e.g., in incidence analysis, a general equilibrium approach is also included. The theory of social choice is also discussed.

This graduate module on economic growth and development is organised into three parts. Part 1 will survey alternative theories and approaches to economic growth and development. Part 2 will focus on development problems and strategies planning to poverty and income distribution, unemployment and rural-urban migration, agriculture, industry, trade and foreign resources. Part 3 will offer analysis of the development experiences of selected countries in ASEAN and East Asia.

This module covers the concepts of big data, analytics and technologies. The main goal aims at managing and analysing a set of big data. Big data differs from traditional data, as the nature of big data is massive, unstructured, granular, and heterogeneous. Big data is produced by various digital resources and domains including smart phones with multiple sensors, a variety of digital media produced by various social media, and billions of on-line financial transactions. The topics of this module covers big data scalability and process, infrastructure, and analytics using Hadoop, HBase, MapReduce, R, in-database analytics, mining of data streams, etc.

This module provides an in-depth study of Singapore’s economic structure and development strategies in the context of a changing global and regional economic environment. It examines the various policy options available based on economic principles and theories. Thereby the course provides an opportunity for the application of theoretical concepts to the analysis of the Singapore Economy. Basic knowledge of micro and macro economics and applied economics such as development, public finance and monetary economics are very useful.

This module aims to provide students with a basic understanding of the contemporary Chinese economic system and an analytical framework for the study of the modern Chinese economy. Through lecturing and class discussions on the literature, the students will develop the ability to comprehend the major theoretical and policy issues in China’s economic development and transformation. They will also attain confidence in applying theoretical-quantitative approaches to the analysis of these issues.

This course is designed to enhance understanding of economic growth by analysing the experience of East Asian countries. By looking at both common and specific factors across the countries and related theoretical issues, it attempts to provide students with both analytical and realistic view on development process. The major topics include catching-up debate, comparisons of Asian models, the role of the state, industrial and trade policy, foreign direct investment, globalisation, and the Asian financial crisis.

Modern market design principles are creatively and increasingly improving a range of economic and other systems. This module will cover the principles behind the design of markets and how they are actually applied. The first part introduces the theory of auctions and discusses how auctions for radio spectrum licenses, internet key search words and advertisements, and eBay work. The second part covers other types of systems which include applications that are as diverse as allocation of environmental permits, systems for matching medical interns to hospitals, partner matching (e.g., marriage), and facilitating kidney exchange. On completion of the module, students will:
• be able to apply economic principles of allocation and incentives to actively harness market forces to achieve specific goals in a broad range of markets
• have the knowledge of how a range of standard market design tools like auctions, matching rules, etc., work in different situations to allocate tangible and intangible assets

The module provides an overview of key urban economic theories, including increasing return and spatial equilibrium, urban transportation and urban forms, housing choices and residential externalities, and urban growth and public finance. These theories are then applied to the analysis of urban challenges, such as urbanization, land-use efficiency, housing affordability, and sustainable urban development. Students will be challenged to understand the various difficult issues faced by cities in developing as well as developed economies. They will learn to apply urban economic theories to analyse these challenging issues and to evaluate policy options for addressing these issues. The module equips students with key urban economic theories and their applications to the analysis of urban challenges, such as urbanization, land-use efficiency, housing affordability, and sustainable urban development.

This course examines the economics behind environmental issues and problems and policies designed to address them. Topics are focused on valuation of nonmarket goods, cost‐benefit analysis, project selection, correcting market failures especially in the provision of public goods, the tragedy of the commons, and climate change. This class will provide students with the tools to understand how market inefficiencies might arise in the presence of externalities like pollution and how market solutions can correct market failures. We will study topics on pollution control, valuation of environmental amenities, natural resource management and cost benefit analysis. We will look at market mechanisms like cap and trade, as well as taxes and subsidies, as well as how to correct the under provision of public goods. A large part of the course will also look at climate change and its impact on the economy. This course requires some fieldwork.

To familiarise advanced (graduate) students with comprehensive knowledge of the problems and prospects of the developing agenda of Globalisation in the twenty-first-century. The module will attempt to capture the socio-economic impact of the global restructuring currently under way with much emphasis on empirical and policy issues as they pertain to matters as diverse as migration, financial flows and the environment. The approach is comprehensive and examines the political economy—not just the economics—of the emergent processes. As such, institutional factors, traditionally omitted in more standard analyses, are factored in. The perspective of the module is also global with no special regional emphasis.

The purpose of this module is designed to help students become comfortable and creative as economic researchers and modelers. The course teaches both the principles of microeconomic theory and the fundamental concepts in the various fields of applied microeconomics, such as health economics, public economics and labour economics. Students will learn how to use various economic tools to predict how various parties might respond to changes in public policies. The philosophy behind this course is learning by doing. By applying economic theories to analyze real world issues, students will strengthen their understandings of economic theories. By the end of this course, students should be able to assess the potential effect of hypothetical changes in the health care system on costs and access as well as on providers and consumers.

The purpose of this module is to introduce students to the application of economic theory to public policy. The emphasis will placed on economic analysis of public policy. Topics include market failures and government intervention, intellectual property right protection, taxation, income distribution, education, public goods, social security and health care. Students will have better understanding of the impact of various public policies and will be able to use the tools introduced in this module to do policy analysis.

This module applies the tools of macroeconomic analysis to analyze issues related to the determination of output, unemployment and inflation in the economy. It utilizes various economic frameworks and models for understanding macroeconomic developments and events. The module examines the applications of macroeconomic theory to policy in analysing the causes of macroeconomic events and their consequences. The students will learn to apply macroeconomic principles to analyze contemporary and historical macroeconomic developments. They will learn about the applications of macroeconomic theory to policy in using various economic models and framework for understanding and analyzing macroeconomic events, their causes and consequences. They will be provided with opportunities to enhance their reading and analysis as well as writing and presentation skills.

This course provides an introduction to the field of behavioural economics. In the first part of the course, we will familiarize students with specific empirical problems of the standard model in economics, which assumes that individuals are fully rational, act consistently over time, and are strictly selfish. We will show how departures from these assumptions can be modelled and integrated into economics analysis. In the second part, we will show how this approach can be put to use. We will study how policy interventions can be made more effective, for example in resource conservation, retirement savings, and human-resource practices. In the first part of the course, students will gain an understanding for which types of decisions the standard model in economics systematically fails to describe human behaviour. They will learn how to model these behaviours, and know the relevant empirical literature. In the second part of the course, students will learn how to implement randomized controlled trials to evaluate and utilize the concepts developed in the first part of the course. The module equips students with a sense of the circumstances under which the standard economic model is going to make misleading predictions and makes them aware of the evidence. It complements the strong methodological component of the program by proposing simple ways to model departures from the standard model in economics. It also complements the applied side by putting a heavy emphasis on empirical applications and the design of behavioural interventions that can be used in the private or public sector.

Other university modules upon approval

Not all modules may be offered in any particular academic year. Module offerings will depend on student interest and staff availability.

* In lieu of these compulsory modules a candidate may opt to take EC5101 Microeconomic Theory, EC5102 Macroeconomic Theory, and EC5103 Econometric Modelling and Applications I from the Master of Social Sciences (by Research) Programme.