Module Catalogue 2016/17

ECO3021 : Economics of Risk and Uncertainty

  • Offered for Year: 2016/17
  • Module Leader(s): Prof. Mich Tvede
  • Owning School: Newcastle University Business School
  • Teaching Location: Newcastle City Campus
Semester 2 Credit Value: 10
ECTS Credits: 5.0
Pre Requisites
Code Title
ECO2004Microeconomic Analysis
Pre Requisite Comment

Or equivalent.

Co Requisites
Co Requisite Comment



To develop students' understanding of how individual decisions are made in the presence of risk and
uncertainty, with applications to especially financial decisions but also to other decisions where risk and uncertainty are present.

Outline Of Syllabus

The course begins with the development of the basic theories of choice under uncertainty, such as Expected Utility Theory and Project Theory, as well as the prescriptive and descriptive effectiveness of such theories. Application of the basic theory to financial decision making is the considered. The course then moves on to a detailed study of the interaction of real markets and financial markets. The role of financial markets in allocating risk, how financial assets are priced and the role of expectation are issues addressed in the course.

Learning Outcomes

Intended Knowledge Outcomes

An understanding of how choices are made under uncertainty and its implications.

Intended Skill Outcomes

Application of economic reasoning to issues in risk and uncertainty. The development of the ability to solve analytical problems associated with risk.

Graduate Skills Framework

Graduate Skills Framework Applicable: Yes
  • Cognitive/Intellectual Skills
    • Critical Thinking : Present
    • Data Synthesis : Present
    • Active Learning : Present
    • Numeracy : Present
    • Literacy : Present
    • Information Literacy
      • Source Materials : Present
      • Synthesise And Present Materials : Present
  • Self Management
    • Self Awareness And Reflection : Present
    • Planning and Organisation
      • Decision Making : Present
    • Personal Enterprise
      • Innovation And Creativity : Present
      • Initiative : Present
      • Independence : Present
      • Problem Solving : Present
      • Adaptability : Present
  • Interaction
    • Communication
      • Oral : Present
      • Interpersonal : Present
      • Written Other : Present
  • Application
    • Commercial Acumen
      • Market Awareness : Present
      • Governance Awareness : Present
      • Financial Awareness : Present
    • Social Cultural Global Awareness : Present
    • Legal Awareness : Present

Teaching Methods

Teaching Activities
Category Activity Number Length Student Hours Comment
Guided Independent StudyAssessment preparation and completion132:0032:00N/A
Scheduled Learning And Teaching ActivitiesLecture72:0014:00N/A
Guided Independent StudyDirected research and reading125:0025:00N/A
Scheduled Learning And Teaching ActivitiesSmall group teaching41:004:00N/A
Guided Independent StudyIndependent study125:0025:00N/A
Teaching Rationale And Relationship

1. Lectures develop the course material focusing on theoretical issues.
2. Seminars develop a specific topic through an in-class experiment.
3. Workshops will focus on solving analytical problems to reinforce the material introduced in lectures.

Reading Lists

Assessment Methods

The format of resits will be determined by the Board of Examiners

Description Length Semester When Set Percentage Comment
Written Examination1202A100N/A
Assessment Rationale And Relationship

Unseen exam is designed to test study across a broad range of subject areas.


Past Exam Papers

General Notes

Original Handbook text:

Disclaimer: The information contained within the Module Catalogue relates to the 2016/17 academic year. In accordance with University Terms and Conditions, the University makes all reasonable efforts to deliver the modules as described. Modules may be amended on an annual basis to take account of changing staff expertise, developments in the discipline, the requirements of external bodies and partners, and student feedback. Module information for the 2017/18 entry will be published here in early-April 2017. Queries about information in the Module Catalogue should in the first instance be addressed to your School Office.