DEPARTMENT OF ECONOMICS AND FINANCE UNDERGRADUATE AND POSTGRADUATE COURSES pot

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UNIVERSITY OF CANTERBURY




DEPARTMENT OF ECONOMICS AND FINANCE




UNDERGRADUATE AND
POSTGRADUATE COURSES





2013

(1
st
Edition)

“The master-economist must possess a rare combination of gifts. He must be
mathematician, historian, statesman, philosopher. … He must be purposeful and
disinterested…; as aloof and incorruptible as an artist; yet sometimes as near the earth
as a politician.”
John Maynard Keynes.




This publication is issued for information only. The University Calendar is the authoritative source
for all regulations and prescriptions, and also for detailed information on the content and
prerequisites of courses offered by other departments.



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CONTENTS
FROM THE HEAD OF DEPARTMENT OF ECONOMICS AND FINANCE 4
THE DEPARTMENT 5
LOCATION AND CONTACT DETAILS OF THE DEPARTMENT OF ECONOMICS AND FINANCE 5
Where is the Department of Economics and Finance? 5
Where do I get help with course advice? 5
STUDYING ECONOMICS AND FINANCE 6
WHAT IS ECONOMICS? 6
WHAT IS FINANCE? 6
PATHWAYS OF STUDY 7

First year 8
Second Year - Economics 9
Second Year - Finance 9
Third year - Economics 10
Third year – Finance 10
Economics Pathways for different types of student 12
Finance Pathways for different types of student 13
Pathway for students interested in Macroeconomics and Monetary Economics 14
An LLB and an Honours degree in Economics in five years. 15
Economics options in the Bachelor of Arts (B.A.) 15
The Economics Honours Programme 17
Where did the 2011 Honours Graduates go? 18
The Graduate Diploma in Economics 18
Master of Commerce or Master of Arts in Economics 18
The Postgraduate Diploma in Economics 19
The Finance Honours Programme 19
The Graduate Diploma in Science 19
Master of Commerce in Finance 20
The quality of the Honours programme 20
SOME COMMONLY ASKED QUESTIONS 21
Do I need to have studied Economics or Finance before? 21
What should I study at secondary school? 21
What Mathematics and Statistics do I need? 21
I have studied economics at school, can I go directly into 2nd year classes? 21
What level of English language do I need? 22
What is the difference between ECON 202/203 and 207/208? 22
In what circumstances can prerequisites be waived? 23
Do any courses have limitation of entry? 24
Should I do a BA, BCom or a BSc? 24
What can I combine economics and/or finance with? 24

How do marks relate to grades in the Department of Economics and Finance? 25
How is the class of honours determined in the Department of Economics and Finance? 26
What happens if I am unable to hand in a piece of assessment on time or attend a test or exam? 27
UNDERGRADUATE COURSES 28
ECON 104-S1/S2INTRODUCTION TO MICROECONOMICS 28
ECON 105-S1/S2INTRODUCTION TO MACROECONOMICS 29
ECON 202-S1 INTERMEDIATE MICROECONOMICS WITH CALCULUS I 30
ECON 203-S2 INTERMEDIATE MICROECONOMICS WITH CALCULUS II 31
ECON 206-S2 INTERMEDIATE MACROECONOMICS 32
ECON 207-S1 INTERMEDIATE MICROECONOMICS I 33
ECON 208-S2 INTERMEDIATE MICROECONOMICS II 34
ECON 213-S1 INTRODUCTION TO ECONOMETRICS 35
ECON 222-S1 INTERNATIONAL TRADE 36
ECON 223-S1 INTRODUCTION TO GAME THEORY FOR BUSINESS, SCIENCE AND POLITICS 37
ECON 224-S2 ECONOMICS AND CURRENT POLICY ISSUES 38
ECON 225-S1 ENVIRONMENTAL ECONOMICS 39
FINC 201-S1/S2 BUSINESS FINANCE 40
FINC 203-S1 FINANCIAL INSTITUTIONS AND MARKETS 41
FINC 205-S2 PERSONAL FINANCE WITH MATHEMATICS 42
ECON 321-S1 MATHEMATICAL TECHNIQUES IN MICROECONOMICS 43

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ECON 322-S2 GAME THEORY 44
ECON 323-S2 TIME SERIES METHODS AND STOCHASTIC PROCESSES 45
ECON 324-S1 ECONOMETRICS 46
ECON 325-S2 ADVANCED MACROECONOMICS 47
ECON 326-S1 MONETARY ECONOMICS 48
ECON 327-S1 ECONOMIC ANALYSIS OF LAW 49
ECON 329-S1 INDUSTRIAL ORGANISATION 50
ECON 331-S2 FINANCIAL ECONOMICS 51

ECON 332-S2 ECONOMICS AND PSYCHOLOGY 51
ECON 333-S2 EXPERIMENTAL ECONOMICS 52
ECON 336-S2 PUBLIC CHOICE 53
ECON 337-S1 ECONOMIC EVALUATION IN HEALTH 54
ECON 340-S1 DEVELOPMENT ECONOMICS 55
ECON 341-S2 ECONOMICS OF EDUCATION 56
ECON 342-S2 ECONOMIC HISTORY 57
ECON 344-S2 INTERNATIONAL FINANCE 58
ECON 345-S1 ECONOMICS OF RISK AND INSURANCE 59
FINC 301-S1 CORPORATE FINANCE THEORY AND POLICY 60
FINC 302-S1 APPLIED CORPORATE FINANCE 61
FINC 305-S2 FINANCIAL MODELLING 62
FINC 311-S1 INVESTMENTS 63
FINC 312-S2 DERIVATIVE SECURITIES 64
FINC 316-S1 FIXED INCOME SECURITIES 65
FINC 331-S2 FINANCIAL ECONOMICS 66
FINC 344-S2 INTERNATIONAL FINANCE 67
FINC 345-S1 ECONOMICS OF RISK AND INSURANCE 67
POSTGRADUATE COURSES 68
ECON 603-S1 MICROECONOMICS I 68
ECON 605-S1 MACROECONOMICS I 68
ECON 641-S2 MONETARY ECONOMICS: THEORY 69
ECON 642-S1 MONETARY ECONOMICS: POLICY 69
ECON 643-S2 INTERNATIONAL FINANCE 70
ECON 653-S2 PUBLIC ECONOMICS 71
ECON 655-S2 ENVIRONMENTAL ECONOMICS 72
ECON 663-S2 ECONOMETRICS I-600 73
ECON 664-S1 ECONOMETRICS II-600 73
ECON 665-S1 WELFARE ECONOMICS 74
ECON 667-S2 BEHAVIOURAL ECONOMICS 75

ECON 668-S1 EXPERIMENTAL ECONOMICS 76
ECON 669-S1 SPECIAL TOPIC: ECONOMICS OF PROPERTY RIGHTS AND INSTITUTIONS 77
ECON 678-S1 DIRECTED READINGS IN ECONOMICS I 77
ECON 679-S2 DIRECTED READINGS IN ECONOMICS II 77
ECON 680-W RESEARCH EXERCISE 78
FINC601-S2  ADVANCED CORPORATE FINANCE 79
FINC 604-S2 ADVANCED DERIVATIVE SECURITIES 79
FINC609-S1 ADVANCED INTERNATIONAL FINANCE 80
FINC611-S1 SPECIAL TOPIC: CORPORATE GOVERNANCE 80
FINC 612-S2 SPECIAL TOPIC: APPLIED FINANCIAL MANAGEMENT 81
FINC615-S1 FINANCIAL RISK MEASUREMENT 81
FINC 641-S2 MONETARY ECONOMICS: THEORY 82
FINC 643-S2 INTERNATIONAL FINANCE 82
FINC 651-S2 FINANCIAL MODELLING 83
FINC 652-S1 FINANCIAL RISK MANAGEMENT 84
FINC 680-W RESEARCH PROJECT 84
DEPARTMENTAL STAFF 85
DISHONEST PRACTICE 86
Group Work 86
Plagiarism 86
STUDENT COMPLAINTS 87
CLASS REPRESENTATIVES 87
SCHOLARSHIPS AND PRIZES 88

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From the Head of Department of Economics and Finance

Welcome to the Department of Economics and Finance. We are a diverse department,

comprising two subject areas and teaching into three undergraduate degrees.

Economics and Finance are united in a single Department with the two subjects
retaining their distinct nature and value. Economics courses are labelled ECON and
Finance courses FINC. Students can choose to major in either subject alone or to
follow a coherent combined path of study. Some of the Department’s 300-level courses
are double coded across the two subjects to reflect this approach.

Economics and Finance combine well with most other subjects, which is reflected in
the fact that Economics is a major in the B.A., B.Com. and B.Sc. degrees, and Finance
is a major in the both the B.Com and the B.Sc. Students in the B.A. can major or
minor in Economics with a number of courses aimed at the interests of these students.

We value diversity in our student body and strongly encourage students to take courses
from across the University.

The lecturers in our Department are passionate about what our subjects have to offer
and are passionate about the teaching programme. We are always happy to help
students plan their degrees.

Work hard and enjoy your studies.

Prof. Bob Reed
Head of Department

“A government could print a good edition of Shakespeare's works, but it could not get them
written. Every new extension of Governmental work in branches of production which need
ceaseless creation and initiative is to be regarded as prima facie anti-social, because it retards
the growth of that knowledge and those ideas which are incomparably the most important form
of collective wealth.”
- Alfred Marshall, "The Social Possibilities of Economic Chivalry", Economic Journal, 1907

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The Department

Location and Contact details of the Department of Economics and Finance

Where is the Department of Economics and Finance?

The department is currently located on the Kirkwood Oval Village. To arrange to see
your lecturer or another staff member you are best to contact them in advance since
access to office pre-fabs is by swipe card.

General enquiries can be made via the Departmental Administrator. The postal
address and phone/fax/email codes are:

Department of Economics and Finance
University of Canterbury
Private Bag 4800

Christchurch 8041
New Zealand

Telephone: +64 3 364 2631



Where do I get help with course advice?
Economics
Undergraduate enquiries:

Postgraduate enquiries:

Finance
Undergraduate enquiries:

Postgraduate enquiries:
or





Or contact the Student Advisors:
See /> for how to contact
the student advisors.

This booklet is designed to give a brief introduction to the Department of Economics
and Finance. Details are correct at time of printing but may change over time. For
more information on our people, courses and other options please see the

department’s web page at


“Only government can take perfectly good paper, cover it with perfectly good ink and make the combination
worthless.”
Milton Friedman, Nobel Laureate in Economics, 1976

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Studying Economics and Finance

What is Economics?

Economics is the study of how societies allocate scarce resources among competing
uses. It is about the choices made by people, individually and collectively, in the
production, exchange, distribution and consumption of goods and services. Central
to economic analysis is the study of how people respond to incentives in a market
economy, how these incentives may be modified by government intervention, and
whether and how government intervention is warranted. At Canterbury, emphasis is
placed on the three core areas of study. These are:

 Microeconomics
, which examines the behaviour of individuals, households and
firms, and their interactions in markets. Microeconomics examines economic
choices in decentralised markets and reaches conclusions about economic welfare.
Markets which are regulated by government, or have only a few participants, or
are characterized by different amounts of information, are also examined.
 Macroeconomics,
which examines the performance of an economy as a whole,
and provides insights into the reasons for fluctuations and trends in national
income, unemployment, inflation, interest rates, and exchange rates. It also

involves examination of a government's taxation, expenditure, monetary and
exchange rate policies.
 Econometrics,
which brings economic theories to the data. It is the study of
methods aimed at i) testing economic theories and ii) providing quantitative
information on economic relationships for policy analyses and decisions. Courses
provide both an accessible account of available econometric methods, and
numerous illustrations of these methods with applications to real data sets in
hands-on laboratory classes that introduce students to the latest developments in
computing and web technology.


What is Finance?

Finance is the study of savings, investment and risk. It describes the ways in which
individuals form, or should form, investment portfolios; the ways in which firms
make, or should make, investment decisions, and how they can best pay for these
investments; and the ways in which markets, institutions, regulators and governments
facilitate these decisions. As in economics, incentives play a pivotal role, but with
the added dimension that responses have uncertain and long-reaching consequences.
Finance draws heavily on the tools of mathematics, statistics (including probability),
and accounting, as well as economics and econometrics. At Canterbury, emphasis is
placed on the three core areas of finance. These are:


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 Corporate Finance,
which focuses on the financial decisions of the business firm.

Topics include the cost of investment capital, the impact on firm value of
managerial decisions about investment, and the methods used to pay for these
investments.

 Investments,
which is the application of scientific tools to personal investment
decisions. Topics include the ways in which assets and securities can best be
combined for individual investors, how these instruments are priced by markets,
and how their performance can be measured.

 Financial Institutions and Markets,
which describes the role of banks, regulators
and other institutions intrinsic to the financial system, explains the ways in which
financial markets operate, and analyses the determination of interest rates.

Both Economics and Finance are about decisions and decision makers, consumers,
employers, investors and policy makers in government agencies and industry. The
objective of both disciplines is to help decision makers make better decisions. By
studying economics or finance (either as your major or simply as part of your degree)
you may have the chance to have an important impact on the well-being of many
people - and there is also the possibility of earning a good living yourself.

You can choose to major in economics or finance (or both), but even if you don’t,
including some courses in your degree will equip you with some valuable critical
thinking and analytical skills that will enhance your understanding of the world we
live in.

Pathways of Study

The flexibility of University of Canterbury degrees allows students to design a
personal course of study to meet their needs. Set out below are possible courses of
study but they are suggestions only and our team will be happy to advise you.

The University Calendar sets out the definitive rules for the various degrees and if in
doubt, students should check the Calendar. First year students in particular should
seek advice at enrolment time.



“It has been my experience that competency in mathematics, both in numerical manipulations and in
understanding its conceptual foundations, enhances a person's ability to handle the more ambiguous and
qualitative relationships that dominate our day-to-day financial decision-making.”
Alan Greenspan

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Along with the general requirements of the degree, students who wish to major in
economics must meet the following conditions:

100-level ECON104 and ECON105
200-level ECON 202 or 207; and
ECON 203 or ECON 208 or ECON 213; and
ECON 201 or 206 or 15 points ECON at 200-level which has not
been used to satisfy other 200 level majoring requirements
300-level At least 60 points of 300-level Economics, which must include
ECON 325 if ECON201 or ECON206 have not been credited to
the degree.

(Note that ECON202/203 and 207/208 replaced 230 and 231 respectively).

Along with the general requirements of the degree, students who wish to major in
finance must meet the following conditions:

100-level ACCT102
200-level FINC201 and FINC203
300-level At least 60 points of 300-level Finance, which must include at
least two of FINC301, FINC311, FINC312.

Students do not specialise in any one area of economics or finance as such (as you
might in engineering with civil, mechanical, chemical etc). Students who progress to
the 300 level and then on to honours will usually take courses that suit their particular
strengths and interests though the end result is still an “economics” or “finance”
degree.

Students who wish to minor in economics with the B.A. will need to include ECON
207 (or they can take ECON 202 if they have taken MATH 102).

So what courses should students take? Here’s some general advice.

First year
Economics students should take ECON 104 and ECON 105. Finance students should
take ECON 104 and ACCT 102 and probably ECON 105. We recommend that
students also take STAT101 (a course required for the BCom. anyway.)

Students who wish to keep open the option of continuing to honours in economics
should also take MATH 102. Students who do not take MATH 102 in their first year
can still progress to level 200 math based courses but will usually need to take
MATH 102 in their second year, and for finance students this will need to be in

semester 1 (for finance students not continuing to honours, MATH 101 is sufficient).
Finance students intending to proceed to honours should also take MATH 103.


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WARNING: Students without a mathematics background equivalent to NCEA Level
2 should pass MATH 101 before enrolling in any second year courses in finance.
Most third year courses have a prerequisite of MATH101 or MATH102. (MATH102
is recommended and is a prerequisite for some 300 level FINC courses. If you do not
take MATH102, there is no guarantee there will be enough 300 level FINC courses
offered every year to allow you to graduate.)

Many students have no interest in mathematics. However, there is a very good
pathway through to a major in economics that does not require mathematics. In the
B.A., economics is also a very attractive minor option. This handbook contains more
specific information on those various pathways.

Students should plan the rest of their first year to allow them as much second year
flexibility as possible. Many students, when they enter university, are unsure as to
which area of study they will eventually major in and their subject preference does
not become clear until well into the first year. Students should plan with an eye to
allowing a range of options in the second year.

Students who would benefit from improving their written English skills should also
consider enrolling in ENGL 117 or another course of interest that provides students
with an opportunity to develop their written skills.


Second Year - Economics

Students who wish to keep open the option of continuing to honours should take
ECON 202, 203, 206 and 213. You may choose to omit ECON 206 if that provides
some space for a more preferred course but you must then take ECON 325.

Students who do not wish to pursue the mathematics based set of courses are advised
to take ECON 206, 207 and 208. ECON 213 is a very good addition to this set but is
not required.

Students can also choose from a range of elective economics courses such as ECON
222 (International Trade), 223 (Game Theory), 224 (Policy Issues) and 225
(Environmental) depending on specific interests.


Second Year - Finance
All Finance majors must take FINC 201 (Business Finance) and 203 (Institutions and
Markets). Students without a mathematics background equivalent to NCEA Level 2
should pass MATH 101 before enrolling in any second year courses. Students
intending to progress to honours should also take ECON 202, ECON 213 and FINC
205.


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A frequent comment from honours students is that “more maths is useful”. MATH
103 therefore provides a useful addition to a course of study in economics or finance.


Third year - Economics
Students majoring in economics must take at least 60 points in economics at level
300.

Students who are intending to continue to honours are advised to take 45 points from
ECON 321 to 326. We strongly recommend taking ECON 324. Not only does this
open up a greater range of projects at the honours level but quantitative skills are
valued in the work place. For those who intend to progress to honours, it is also a
really good idea to take at least one applied course at the 300 level.
(Note that students who took ECON 208 rather than 203 prior to 2013 will be
allowed to enter honours provided they also pass ECON 321. Students who take their
200-level intermediate microeconomics course from 2013 onwards will be required
to take ECON 203 in order to enter honours).

Students who are not intending to progress to the honours level should select their
courses at the 300 level carefully. Many courses have a MATH or a STAT
prerequisite (or both). This is a strong signal that there is a significant mathematical
content to the course. Other 300 level courses are more language rather than
mathematics intensive and will usually involve more reading, written work or
sometimes presentations. Students should investigate carefully which courses are
most likely to suit their needs. A good approach is to “shop around” in the first two
weeks. You are free to change your course selection during this time.


Third year – Finance
Students majoring in Finance must take at least 60 FINC 300-level points. These
must include 2 of FINC301, FINC311, FINC312.

Most 300-level Finance courses have MATH101 or MATH102 as a prerequisite, but
the latter is recommended. These courses differ in their requirements. FINC 312 and
331 make extensive use of mathematics (calculus, algebra and probability). FINC
305 requires considerable familiarity with spreadsheets. Enrolment in FINC 302 and
305 is limited to 70 students.

Students intending to proceed to honours must take FINC 331. Students intending to
major in Finance under the B.Sc. must be credited with FINC 331 or ECON 331.

Note: there is no guarantee all of these courses will be offered every year. Plan your
course sequence with flexibility in insure you can graduate. Specifically, consider
taking MATH102 in your first or second year to maximise your options.


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What undergraduate pathways and combinations make sense?
Students who wish to pursue a serious career in economics or finance (e.g. with the
Reserve Bank or Treasury, or as an investment banker or securities dealer) should be
aiming for an honours degree. Students armed with an honours degree in economics
or finance (or both) from the University of Canterbury are very successful in securing
good jobs. An undergraduate degree in either subject will also lead to some great
career options. However, your success in applying for positions is likely to be due as
much to the fact that you have a degree as it is that it is a degree in economics or
finance.

One very important factor in your ultimate success in securing that dream job is your
grades. It may be true that “C’s get degrees” but it is also true that a C grade average
degree is less competitive than a B or A grade average one.

Students who choose an undergraduate course of study in economics or finance do so
for many reasons. Some continue to postgraduate study here or at another university.
Economics in particular lends itself very well to being combined with another
discipline. Some students combine two degrees such as the LLB and BA or the LLB

and BCom. Others combine economics with a subject in the same degree such as, for
example, political science or history (BA), accounting (BCom), or statistics (BSc).
Some combinations can be done under more than one degree, for example economics
and finance can be either a BSc or a BCom.

The undergraduate courses you choose will reflect what your ultimate goal is and
what your strengths are. The table on the next page sets out some possible options.

(Note that prior to 2010 MATH 102 was known as MATH 108 and STAT 101 was
known as STAT 111).













“Remember that time is money:” Benjamin Franklin


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Economics Pathways for different types of student

The Minimum route. The Law and
Economics route
The Liberal Arts
route.
The quantitative
route.
The Behavioural
Science route.
The Honours bound
student
This option is most
suited to students who
are combining
economics with
something else and
who do not wish to
take mathematics or
statistics and who only
have room for the bare
minimum to qualify for
a major in economics.

ECON 104
ECON 105

ECON 206
ECON 207
ECON 208

60 points from any 300

level ECON courses.


This route will appeal
to students taking an
LL.B. along with a
second degree Law
students who are
competent in
mathematics should
look at the 5 year
LL.B./B.Com.(hons) or
LL.B./B.A.(hons)
option described in this
handbook.

ECON 104 and 105

ECON 206
ECON 207
ECON 208

ECON 222, 223, 224
and 225
60 points from 300-
level ECON with 327,
329, 335, 336, 340, 341
and 342 likely to
appeal.
This combination of

courses is suggested
for those students who
are combining
economics with
another arts subject in
the Bachelor of Arts
and who do not wish to
take mathematics or
statistics (see later for
more specific
pathways).

ECON 104 and 105

ECON 206
ECON 207
ECON 208

ECON 222, 223, 224
and 225
60 points from 300-
level ECON with 332
to 342 likely to appeal.
This combination suits
students who are
combining with
subjects such as
statistics, management
science or finance and
who enjoy a

quantitative approach.

ECON 104 and 105
MATH 102 & STAT
101

ECON 202
ECON 203
ECON 206
ECON 213

60 points from 300-
level ECON with 321,
323, 324 325, and 331
likely to appeal.
Students studying
subjects such as
Psychology or
Sociology will find that
Behavioural and
Experimental
Economics topics are
an ideal complement.

ECON 104 and 105
(MATH 102 and STAT
101 may be useful)

ECON 202 or 207
ECON 203 or 208

ECON 206
ECON 213

60 points from 300-
level ECON with 322,
332 and 334 likely to
appeal.


Students who wish to
keep their honours
options open should
take

ECON 104 and 105
MATH 102 & STAT
101

ECON 202
ECON 203
ECON 206 (or 325)
ECON 213

You should also take 3
courses from ECON
321 to 326 plus a
selection of other
courses that suit your
skills and interests.
MATH 103 is also

useful as is a written
language rich courses
such as ENGL 117.




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Finance Pathways for different types of student

The Minimum route. The quantitative route. Finance and Accounting
Double Major Students
Economics and Finance
Double Major students
The Honours bound
student
This option is most suited to
students who are combining
finance with something else
and who do not wish to take
mathematics or statistics
and who only have room for
the bare minimum to
qualify for a major in
finance.

ACCT102, MATH 101,
MSCI 110 or STAT 101.

FINC201

FINC203

60 points from 300-level
FINC courses including at
least 2 of FINC301,
FINC311, FINC312.
This combination suits
students who are combining
with subjects such as
statistics, maths and/or
management science and
who enjoy a quantitative
approach.

ACCT 102
ECON 104 and 105
MATH 102 and 103
STAT 111 or STAT 112

ECON202
ECON 213 or STAT 201
FINC201 and FINC203 and
FINC205

FINC331 and FINC 312
and at least one of FINC301
or FINC311 plus 15 further
FINC 300-level points.

Students who wish to major
in both subjects should take

ACCT 102 and ACCT 103
ECON 104
MATH 102
STAT 101

FINC 201 and 203
ACCT211 and ACCT222
ECON 202 or 208

60 points from 300-level
FINC courses including at
least 2 of
FINC301,FINC311,FINC312
and 60 points from 300-level
ACCT


Students who wish to keep
their Honours options in
both subjects should take

ACCT102
ECON 104 and ECON 105
MATH 102
MSCI 110 or STAT 101

ECON202 and ECON203

and (ECON206 or 325)
ECON 213

FINC201 and FINC203

ECON 321
ECON 323 and ECON324
FINC331
45 additional points from
300-level finance including
at least 2 of FINC 301,
FINC311, FINC312 and
15 additional points 300-
level ECON.


Students who wish to keep
their honours options open
should take

ACCT102
ECON 104
MATH 102 (rec. 103)
MSCI 110 or STAT 101

ECON 202
ECON 213 or any 30 points
from STAT 200-level
courses

FINC201, FINC203 and
FINC 205

FINC331
45 additional points from
300 level finance including
at least 2 of FINC301,
FINC311, FINC312.




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Pathway for students interested in Macroeconomics and Monetary Economics

First Year:


Second Year:



Third Year:



Honours Year:

Students may take any of the macroeconomic courses at honours level. However students are advised of the following:
1. those who wish to take ECON 605 or 633 are advised to take 325.
2. those who wish to take ECON 641 or 642 are advised to take 326.
3. those who wish to take 643 are advised to take 344
As with many areas of economics, a sound understanding of econometrics is also useful.

ECON 104 and 105
MATH 102
ECON 206
Macroeconomics
ECON 325
Advanced
Macroeconomics
ECON 326
Monetary Economics
ECON 344
International Finance

ECON 605
Macroeconomics
ECON 641 Monetary
Theory
ECON 642 Monetary
Policy
ECON 633
Empirical
Macroeconomics
ECON 643

International Finance

ECON 202
Microeconomics
with calculus

15

An LLB and an Honours degree in Economics in five years.

It is difficult but not impossible for very able students to achieve an LLB and
an
honours degree in economics in five years (a strong mathematics facility is highly
desirable). The required papers to enter an honours degree in economics are taken
within the LLB and the student does not complete an undergraduate degree in
economics itself. The course of study would look something like this:

Year 1: LAWS101, 110, ECON104, 105, MATH102, STAT101, plus one other
100 level course (e.g. MATH 103) (120 points)
Year 2: 4 Group A LAWS courses, ECON 202, 203 (150 points)
Year 3: 2 Group A LAWS courses, 4 Group B LAWS courses, ECON 213, 325
(150 points)
Year 4: 7 Group B LAWS courses, 3 x 300-level ECON (recommended
ECON324). (150 points).

This option does require that one ECON 200 or 300-level course is substituted for
one Group B course which is allowable under the regulations with the approval of
Law. Students wishing to pursue this option must consult the Law Student Advisors.

Some students may also wish to discuss the possibility of an LLB(hons) and an

honours degree in economics. This would involve increasing some years to 165
points. Students should seek advice from both the School of Law and the Department
of Economics and Finance.



Economics options in the Bachelor of Arts (B.A.)

The B.A. degree provides a fantastic opportunity to combine Economics with an arts
subject such as History, Psychology or Sociology. Students can either minor or
major in economics in the B.A. There are a wide range of options available that do
not require any mathematics.

A minor consists of a minimum of 75 points in a single Arts subject, including at
least 45 points above 100-level which includes ECON 207 (or the student may take
ECON 202 if MATH 102 has been passed).

All students seeking a minor in Economics must take the compulsory courses:
(i) ECON 104 (or ECON 199) Introduction to Microeconomics
(ii) ECON 207 Intermediate Microeconomics (or ECON 202)

The following are examples of additional Economics courses that students from
different Arts majors are likely to find interesting.

16

Students Majoring in History and Classics:
ECON 105 Introduction to Macroeconomics
ECON 340 Development Economics
ECON 342 Economic History

Students Majoring in Foreign Languages: (Any 3)
ECON 105 Introduction to Macroeconomics
ECON 222 International Trade
ECON 340 Development Economics
ECON 342 Economic History

Students who are seeking in major in Economics in the B.A. will need to minor in
another discipline. The following are examples of Arts courses that Economics
students are likely to find interesting.

Students interested in History
HIST136 Revolutions and Revolutionaries
HIST137 Modern World History
HIST253 Renaissance and Reformation Europe
HIST275 The Muslim World, 600-1650
HIST291 Chinese Society and Culture since 1949

Students interested in Classics
CLAS104 Greek Mythologies
CLAS201 Theatre and Performance in the Ancient World
CLAS213 Alexander the Great
CLAS214 Imperial Rome
CLAS220 Troy and Ancient Epic

Students interested in Chinese Language
CHIN 110 Oral Chinese 1
CHIN 115 Introduction to Business Chinese
CHIN 211 Study Chinese in China Summer Programme 1
CHIN 303 Chinese Society and Culture Since 1949 (30 points)

Students interested in Spanish
SPAN101 Beginners’ Spanish A
SPAN102 Beginners’ Spanish B
SPAN201 Intermediate Spanish Language A
SPAN202 Intermediate Spanish Language B
SPAN203 Spanish Conversation and Pronunciation


“The most powerful force in the universe is compound interest” Albert Einstein

17

The Economics Honours Programme

Admission to honours requires a “B+” average or better.

The prerequisites for the honours degree in economics differ from faculty to faculty.
The following shows the prerequisites for each faculty for:

BA(Hons) (1) ECON 201 or ECON 206; and
(2) ECON 213 or STAT 213; and
(3) ECON 203 or ECON 321; and
(4) 60 points in ECON 300-level courses, including at least 15
points from ECON 321, 322, 323, 324, 325, 326

BCom(Hons) (1) ECON 201 or ECON 206; and
(2) ECON 213 or STAT 213; and
(3) ECON 203 or ECON 321; and
(4) 60 points in ECON 300-level courses, including at least 45

points from ECON 321, 322, 323, 324, 325, 326

BSc(Hons) (1) ECON 201 or ECON 206; and
(2) ECON 213 or STAT 213; and
(3) ECON 203 or ECON 321; and
(4) 60 points from ECON 321, 322, 323, 324, 325, 326


There are circumstances under which some of the prerequisites can be waived. See
the Graduate Studies Coordinator to discuss your particular circumstances.

Honours students take 4 courses per semester plus a research paper which lasts the
full year. There are four honours courses that are taken as part of an existing 300-
level course (ECON 663, 664, 678, 679). Students may take a maximum of two of
these courses.
There are also options to take honours level courses across more than one subject.
Students wishing to examine this option should discuss this with the Department’s
Graduate Studies Co-ordinator.

Students taking their 200-level microeconomics courses from 2013 onwards should
note that the entry requirements will be changing from “ECON 203 or ECON 321” to
simply “ECON 203” meaning that students will not be able to enter the honours
programme by taking ECON 208 then ECON 321. Further “ECON 201 or ECON
206” will change to “ECON 201 or ECON 206 or ECON 325”.


“The first lesson of economics is scarcity: There is never enough of anything to satisfy all those who want it.
The first lesson of politics is to disregard the first lesson of economics.”
Thomas Sowell.

18


Where did the 2011 Honours Graduates go?
New Zealand Treasury
Reserve Bank of New Zealand
NZ Debt Management Office.
Transpower
HSBC
Insurance Brokerage firm
KPMG
Pilot training
CERA
Deloittes
Brycharl Corp.
Post-Graduate Study
Travelling Overseas



The Graduate Diploma in Economics
The Graduate Diploma in Economics (GradDipEcon.) is offered as a transitional
route in economics for graduates from other disciplines. For more information on
this qualification, please contact the Graduate Studies Coordinator:
(
).



Master of Commerce or Master of Arts in Economics

The Masters programme is in two parts:
Part I: Eight courses or equivalent from ECON 601 – 679. This is equivalent
to the course work of the honours programme.
Part II: Thesis

Admission to the Masters programme is similar to the admission criteria for Honours
though with a slightly lower 300 level GPA required. Students who complete an
honours year can enter directly into part II of the Masters programme. Students
interested in enrolling in the MA or MCom should talk to the Postgraduate Studies
Co-ordinator.

Students should note that successful completion of the MCom. part I or the honours
year does not automatically mean that a student will be able to enrol in part II of the
MCom. There does need to be a thesis supervisor available though every attempt will
be made to find a supervisor.




19

The Postgraduate Diploma in Economics
The Postgraduate Diploma in Economics is the course work part of the honours year
(so is effectively equivalent to part I of the MCom.). Students who enrol in the
MCom can elect to “cash in” their study at the end of part I and exit with a
Postgraduate Diploma. Students who initially enrol in the Postgraduate Diploma and
successfully complete the requirements for (with a B or better average) can apply to
enrol in part II of the MCom.

The Finance Honours Programme
Students interested in being admitted to honours should consult Professor Boyle by
no later than December of the preceding year.

The prerequisites for admission to the Honours degree in Finance are either

A. B.Sc. or B. Com, with major in Finance, including
1. ECON202, ECON213 or any 30 points from STAT200-level courses,
FINC205, FINC331; and
2. At least a B+ average in 300-level FINC courses

OR

B. Bachelors Degree in a subject other than Finance but including
1. ECON213 or any 30 points from STAT 200-level courses, FINC331
plus an additional 30 points of 300 level Finance.
2. At least an A- average in 300-level FINC courses.

There are circumstances under which some of the prerequisites can be waived. See
the HoD or Professor Glenn Boyle to discuss your particular circumstances.



The Graduate Diploma in Science
The Graduate Diploma in Science (GradDipSci) is offered as a transitional route in
Finance for graduates from other disciplines. For more information on this
qualification, please contact Dr. Debra Reed.

20

Master of Commerce in Finance
The Masters programme is in two parts:
Part I: Eight courses or equivalent from FINC 600-level courses. This is
equivalent to the honours year. Courses from other subjects may be
substituted for FINC courses where appropriate.
Part II: Thesis

Admission to the Masters programme is subject to the same criteria as Honours;
missing pre-requisites may need to be made up prior to or after admission. Students
who obtain first-class honours can enter directly into part II of the Masters
programme. Students interested in enrolling in the MCom should contact Professor
Boyle.



The quality of the Honours programme
The Department of Economics and Finance is proud of its honours programme and
we produce graduates of a high calibre as the following comments from visiting
Erskine Fellows makes clear:

“I am especially impressed with the undergraduate honours program at
Canterbury. This is, I think, superior to the honours program that we offer at
the University of California at Santa Barbara. The class sizes are smaller, the
material more challenging. Students who can perform at this level receive an
excellent education.”
Professor. Ted Bergstrom, 2009

"I found teaching in the honours program at the University of Canterbury to be
especially rewarding. The students were very well prepared and had the
technical backgrounds to take advantage of the more advanced materials that I
was introducing in my course. The maturity level of these students was
extraordinary. They are very well trained and are more advanced than the
honours students I normally encounter at home."
Professor Ronald Oaxaca (McClelland Professor of Economics, University of
Arizona) 2012

“I found it a distinct pleasure to lead a case discussion class in financial
management decision making. The students were well prepared and willing to
participate. The small class size permitted an interaction among the students
that effectively tested both their ability to generate a decision but also to
defend it.”
Professor Roger Stover, (Professor of Finance, Iowa State University), 2012


“Finance sits atop the altar of business research” Edward Lazear, “Economic Inperialism“ Quarterly Journal
of Economics, 2000.

21

Some commonly asked questions

Do I need to have studied Economics or Finance before?
No. Success in economics (either as your major or as part of your study) is not
dependent on the prior study of economics at school, although school work in this
area can help.

What should I study at secondary school?
Students are recommended to devote their secondary school study to gaining a broad
liberal education, and subjects such as history and English that develop the ability to
write clearly and analyse written material are helpful. Studying economics (and
accounting in the case of finance) is useful but not essential. Those students who are
able to succeed in mathematics are strongly advised to take Mathematics with
Calculus at year 13.


What Mathematics and Statistics do I need?
Finance students should take at least MATH 101. Students wishing to continue to
honours in economics or finance must take at least MATH 102 and MATH 103 is
recommended. They must also take STAT 101. Students who wish to major in
economics without the need for mathematics are fully able to do so and there is an
extensive range of 200 and 300-level courses that do not require mathematics.

STAT 101 is strongly recommended for all economics and finance students.



I have studied economics at school, can I go directly into 2nd year classes?
In order to obtain direct entry to 200 level economics (ECON 206 and 202) in their
first year of university study, high school students must study economics at year 13
level (and preferably mathematics with calculus) and meet the requirements as
follows.

ECON202 Microeconomics – to gain direct entry to ECON 202 students must gain
either
(i) an NZ scholarship award in economics; or
(ii) an “excellence” in standards 90630 (3.1) AND 90629 (3.2) (microeconomics);

or
(iii) ECON 199 or ECON 104 via the STAR programme; or
(iv) a grade of 6 or 7 in International Baccalaureate Economics; or
(v) a mark of 80% or higher in Cambridge “A” level (year 13 equivalent)
Economics.


22


ECON206 Macroeconomics – to gain direct entry to ECON 206 students must gain
the requirement for ECON 202 and either
(i) an NZ scholarship award in economics; or
(ii) an “excellence” in standard 90632 (3.4) (macroeconomics); or
(iii) ECON 105 via the STAR programme; or
(iv) a grade of 6 or 7 in International Baccalaureate Economics; or
(v) a mark of 80% or higher in Cambridge “A” level (year 13 equivalent)
Economics.


Students must also enrol in MATH 102 or have achieved a sufficient level of
mathematics to have MATH 102 waived by the Department of Mathematics and
Statistics (e.g. by having taken STAR math or via high school achievement).



All direct entry to 200 level economics courses are at the discretion of the Head of
Department regardless of achievement in high school economics or other study.

What level of English language do I need?
Competence in English expression is essential. All students are presumed to be
competent in English.

Overseas students must have achieved appropriate standards in the International
English Language Testing System (IELTS) or equivalent.

Students wishing to pursue further programmes in English language and
communication may wish to seek advice from the International Student Centre (tel:
3642 391) or the English Language Centre (tel: 3642 905).



What is the difference between ECON 202/203 and 207/208?
Students take either 202/203 or 207/208. Students wishing to continue to honours
must take ECON 202 and 203.

As the names suggest, ECON 202/203 have a mathematics co-requisite (MATH 102)
and will require students to use some calculus in examinations. A co-requisite is a
course you must have already taken or be taking at the same time. Therefore, having
MATH 102 as a co-requisite means that students who did not take MATH 102 in
their first year but who now wish to potentially continue on to honours level can take
ECON 202. ECON 207 has no mathematics requirement, and the approach is a direct

23

follow-on of the graphical intuitive approach that students encountered in ECON 104.
Students who prefer measles to mathematics are more likely to find ECON 207 and
208 to their liking.

Students should use the first two weeks of the semester to make a careful selection of
their option. Go to both courses. Talk to both lecturers.



In what circumstances can prerequisites be waived?

Prerequisites can only be waived where this is noted in the Calendar and is at the
discretion of the Head of Department. However there are some common
circumstances in which a waiver will usually be given. These are as follows:

ECON 203
Students who wish to take ECON 203 after having taken ECON 207 should consult
the Department.

ECON 321, 322, 323, 324, 325, and 326:
Students who have received a restricted pass (C- prior to 2012 or “R” from 2012) in
the MATH pre-requisite can still enrol in these ECON courses.

ECON 321, and 322:
Students who have received a restricted pass (C- prior to 2012 or “R” from 2012) in
the STAT pre-requisite can still enrol in these ECON courses.

ECON and FINC courses with MATH 108 or MATH 102 as a prerequisite:
Students who achieve an A+ in MATH 101 will usually be allowed to enrol in
economics courses where MATH 108 or MATH 102 is a prerequisite.

PSYC 206
For students who are majoring in Psychology and at the discretion of the Head of
Department of Economics, PSYC 206 will be allowed as an alternative to a required
STAT paper. Students seeking this waiver will normally have a solid study record at
both 100 and 200 level.





“If you want to know what's happening in the market, ask the market.” Japanese proverb

24


Do any courses have limitation of entry?
FINC 302 and 305 and 311 are limited to 70 students .

Should I do a BA, BCom or a BSc?
It is not the title of your degree that matters – more important are the subjects that it
contains and the grades achieved. What type of degree you get in economics or
finance is determined by the other subjects that you do. For any of the general
degrees, approximately 70% of the points in the degree must come from the schedule
for that degree and the remaining points can be from any schedule. Some courses are
in more than one schedule (e.g. Economics is in arts, commerce and science; Finance
is in commerce and science) while some are only in one (e.g. Accounting is only in
commerce). It is important to select your courses first which determines the focus of
your degree and then the title of your degree will look after itself. You can seek
further advice on this at enrolment time.
Students who elect to complete a BCom in economics will need to complete the five

compulsory first year courses. Students who elect to complete a BA in economics
will also need to complete a minor in another Arts subject. See the enrolment
handbook for further information.


What can I combine economics and/or finance with?
A degree in economics or finance is not only useful on its own but also makes a
strong partner when combined with other subjects. Students who can combine two
subjects in one degree are strongly
advised to do that and look to complete an
honours year rather than complete two undergraduate degrees.

Students may enrol in any two degrees concurrently and cross-credit courses in
common up to a maximum of 120 points (and not including 300-level courses).
Special provisions have been made, however, in the case of the LLB degree and the
general degrees, which, allow 150 points of cross-crediting between two degrees, and
make possible the completion of both degrees within a five year period. For details,
students should consult the student advisers in the School of Law and the College of
Business and Economics.

Other Double degree combinations include BCom/BA; BCom/BE; and BCom/
BFor.Sc.
Students who have a strength in mathematics and are wanting to combine this with
another subject can consider the joint Mathematics/Economics or
Finance/Mathematics/Statistics Honours programmes. For more details on this
option please contact the undergraduate studies co-ordinator.

See the later section on specific pathways for different degree options.

“Financial economics is the crown jewel of the social sciences.” Paul Samuelson, Nobel Laureate in

Economics, 1970

25


How do marks relate to grades in the Department of Economics and Finance?

The Department of Economics and Finance uses the University of Canterbury
grading scale for purposes of assessment in its courses.


Percentage Mark Letter Grade
90-100 A+
85-89.9 A
80-84.9 A-

75-79.9 B+
70-74.9 B
65-69.9 B-

60-64.9 C+
55-59.9 C
50-54.9 (1) C-

45-49.9 (2) R

40-49.9 D
0-39.9 E

(1) Prior to 2012 a C- grade represented a restricted pass. From 2012 the restricted

pass is denoted as “R”. A restricted pass cannot be used as a pre-requisite for other
courses.

(2) The awarding of a restricted pass is at the discretion of the course lecturer but
where it is awarded it will normally be in the mark range shown in this table. In 300-
level and 400-level courses there is no grade of “R”.









“It is a well known and very important fact that America's founding fathers did not like taxation without
representation. It is a lesser known and equally important fact that they did not much like taxation with
representation.”
John Kenneth Galbraith