Module code: ECOM048

Module Overview

Perhaps the most significant development in microeconomics in the last forty years has been the attempt to deal with market failures caused by asymmetric information and strategic behaviour. The importance of these developments is apparent from the Nobel prizes that have been awarded to game theorists and information economists. This module is designed to cover the central topics related to markets and interactions with asymmetric information.

Studying this module will help you to apply and extend your knowledge of microeconomic theory. You will learn about the effects of asymmetric information and strategic behaviour on the outcomes of market interactions.

Module provider


Module Leader

CARMONA Guilherme (Economics)

Number of Credits: 15

ECTS Credits: 7.5

Framework: FHEQ Level 7

Module cap (Maximum number of students): N/A

Overall student workload

Independent Learning Hours: 128

Lecture Hours: 22

Module Availability

Semester 2

Prerequisites / Co-requisites


Module content

Indicative content includes:

  • Game theory

  • Adverse Selection

  • Signalling

  • Screening

  • Principal-Agent Problem

Assessment pattern

Assessment type Unit of assessment Weighting
School-timetabled exam/test IN-SEMESTER TEST - 1 HOUR 25
Examination EXAMINATION - 2 HOUR 75

Alternative Assessment

Not applicable

Assessment Strategy

The assessment strategy is designed to provide students with the opportunity to demonstrate their understanding of individual decision making in strategic environments with incomplete information and of assessing market outcomes.

Thus, the summative assessment for this module consists of:

  • An in-semester test unit typically scheduled in week 7 will examine analytical tools and understanding of the material covered in the first part of the module.This benefits students by consolidating their knowledge and allowing them to plan how to deal with the demands of the final examination

  • Final examination of two hours consisting of two or three questions that will examine analytical tools and skills obtained during the module. Scheduled in weeks 13-15.

Formative assessment and feedback

Students will receive verbal feedback during the lectures through direct interaction.

Before each coursework test, students will be given a list of sample questions, similar, in their complexity, to the questions at the test itself, and will be encouraged to ask questions. After the class test, each student will receive their own script back with comments and a written indicative marking scheme so that they can judge their own performance and prepare for the final exam.

Module aims

  • To familiarise students with advanced conceptual and appropriate mathematical tools in microeconomic theory.

Learning outcomes

Attributes Developed
001 Systematic understanding of and the ability to critically analyse games of incomplete information KC
002 Systematic understanding of and the ability to critically analyse market failures due to asymmetric information (adverse selection) and potential and partial remedies (signalling and screening) KC
003 Systematic understanding of and the ability to critically analyse the basis of contract theory and the inefficiencies which are generated by unobservable actions and unobservable information KC
004 Systematic understanding of and the ability to critically analyse potential failures in public good markets and markets with externalities KCPT

Attributes Developed

C - Cognitive/analytical

K - Subject knowledge

T - Transferable skills

P - Professional/Practical skills

Methods of Teaching / Learning

The learning and teaching strategy is designed to: enhance skills in formal analysis of strategic decision making in markets with incomplete information. Moreover, a basis is laid for the effective evaluation of markets outcomes.

The learning and teaching methods include:

  • 2 hour lecture per week x 11 weeks

Indicated Lecture Hours (which may also include seminars, tutorials, workshops and other contact time) are approximate and may include in-class tests where one or more of these are an assessment on the module. In-class tests are scheduled/organised separately to taught content and will be published on to student personal timetables, where they apply to taken modules, as soon as they are finalised by central administration. This will usually be after the initial publication of the teaching timetable for the relevant semester.

Reading list
Upon accessing the reading list, please search for the module using the module code: ECOM048

Programmes this module appears in

Programme Semester Classification Qualifying conditions
Economics and Finance MSc 2 Optional A weighted aggregate mark of 50% is required to pass the module
Economics MSc 2 Compulsory A weighted aggregate mark of 50% is required to pass the module

Please note that the information detailed within this record is accurate at the time of publishing and may be subject to change. This record contains information for the most up to date version of the programme / module for the 2020/1 academic year.