Economics – IFBM

Course textbook:

Course handouts: download here.

Assessment instructions: download here.

Course schedule

Pre-course activity
Watch this video:
Session 1 (online)
1. Value creation* +

Textbook reading: Chapter 1

Session 2
2a. Cost curves* +

Evans, A.J., “La Marmotte”, January 2012

Instructions: Complete Exhibit 1 and provide suggestions for the two key decisions

2b. Auctions +

Hild, M., Dwidevy, A., and Raj, A., 2004, “The Biggest Auction Ever: 3G Licensing in Western Europe”, Darden Business Publishing (£)

Discussion question: What are the alternatives to auctions?

Extra activity: The Dutch flower auction

Textbook reading: Chapter 2 and Chapter 3

Session 3
3a. Equilibrium assignment

3b. Adverse selection +

Session 4
4a. Read through the following Twitter thread:

Choose one of the tweets and use it as the basis to apply some microeconomic theory. Make assumptions and perform calculations where necessary.

4b. Price discrimination – Debrief* +

Textbook reading: Chapter 4

Session 5: Online
5. Group presentations

Note: Sessions marked with an asterix (*) have a lecture handout available in advance, which can be downloaded. Cases marked with a pound sign (£) are available via Blackboard. Follow the + links for additional resources.

Extra: Best croissant in Paris


Lecture handout: Progress*
Activity: Transformative Breakthrough Worksheet

Key readings:

Other readings:

Key podcast:

Here’s a concerning thought: “Half of all scientific papers were published in the last 12 years, but much less than half of all scientific progress has happened in that time” (link).

For more on Operation Warp Speed see ‘A Shot to Save the World‘. For a fascinating (but very long) account of Vaccinate CA see The Story of VaccinateCA.

For a survey of potential breakthrough technologies see:

  • Weinersmith, K., and Weiner, Z., 2017, Soonish, Penguin

Or this collaborative slide deck:

In September 2019 Eli Dourado provided a detailed and illuminating look at the sectors most likely to contribute to higher future economic growth, with specific examples of technological possibilities.

In December 2020 Tyler Cowen provided a list of new technologies that may mark the end of the great stagnation. He included:

In February 2022 MIT Technology Review listed their 10 biggest technology breakthroughs in 2022. They are:

  1. Moving away from passwords
  2. Coronavirus variant tracking
  3. A long-lasting grid battery
  4. Artificial intelligence for protein folding
  5. GlaxoSmithKline’s malaria vaccine
  6. Proof of stake
  7. COVID-19 antiviral pills
  8. Practical fusion reactors
  9. Synthetic data for training AI
  10. The world’s largest carbon removal factory in Iceland

Here is an explanation of nuclear fusion:

Here is a podcast with Eli Dourado:

Some of my favourite “no brainer” growth drivers include:

I suspect that future growth requires a cultural shift toward the principle of progress, and this involves a shift to longer term thinking. This post by Max Roser nicely presents the importance of “Longtermism”.

Here is a powerful and fascinating account of why advances in artificial wombs are so important, and I encourage all students to read it and reflect carefully on whether we should:

  • Alter the 14 day rule on keeping embryos in labs.
  • Invest more in Femtech.

For more on Permissionless Innovation:

A good, uplifting account of how creativity can result from not asking permission:

Here is a short quiz activity on the difference between the Precautionary principles and Permissionless innovation.

The importance of ideas:

“Comfort is the enemy of progress” P.T. Barnum:

Key think tanks:

Key movements:

Here is a good Economist article surveying “the new tech worldview” exhibited by the likes of Peter Thiel and Patrick Collison.

Learning Objectives: Link technological innovation to growth theory and a broader reflection on the importance of the humanities

Cutting edge theory: A survey of potentially transformative breakthrough technologies.

Focus on diversity: Virginia Postrel’s book, The Future and it’s Enemies, encapsulates the distinctions made at the end of the lecture. 

Public lectures

I have given public lectures at Oxford University, the University of Manchester and a range of economic think tanks.

Are central bank digital currencies a good idea?”, Oxford Mises Society, Corpus Christi College (May 2023)

“An Introduction to the Austrian School of Economics”, Institute for Economic Affairs (August 2012)

We Had it Coming – An Introduction to Austrian Economics” University of Manchester (March 2012)

“The second revival in Austrian Economics: why the future of good economics is Austrian” Oxford Libertarian Society, Christ Church Oxford (February 2011)

Contemporary work in Austrian Economics” Adam Smith Institute, St Stephen’s Club, London (September 2010) [event detailsaudio here]

“Globalisation after the Crash” Institute of Economic Affairs, London (June 30th 2009) – panellist

Keynote speeches

“Outlook: Which ways to better regulation?” Better Regulation conference, Geneva (September 2018)

The Role of Competitiveness in Emerging Europe” Future proofing the Economy Forum, Zagreb (February 2017) [video highlights]

Sound Money: An Austrian proposal for free banking, NGDP targets, and OMO reforms” Adam Smith Institute, London (February 2016)

How to think like an economist” Adam Smith Institute, London (April 2015)

Austrian Economics for Start Ups: What Do Entrepreneurs Need to Know?” CADI, Bucharest (May 2015)

“Why whistleblowing protection fails and what to do about it” Lucas Graduate School of Business, San Jose State University (October 2011)

“Whistleblowing and the knowledge problem”, College of Business, San Jose State University (September 2011)

“Why Market Monopolies are OK”, Civil Society Institute, Santa Clara University (September 2011)

“The problem with shock therapy is not enough volts: Why Russia needs more powerful oligarchs” David S. Saurman Provocative Lecture Series, San Jose State University (September 2011)

Workshop presentations

I have been invited to present my working papers at institutions including City University, the Cambridge Society for Economic Pluralism, and George Mason University.

Getting the Measure of Money” University of Buckingham (March 2019)

“Choose your own financial crisis” University of Buckingham (January 2017)

Choose your own financial crisis. A methodological defence of second person counterfactual scenarios”, Prague Conference on Political Economy, Prague (April 2016) – not presented

Choose your own financial crisis“, PPE Workshop, George Mason University (September 2015)

Individualism, subjectivism and time: An introduction to the theoretical foundations of the Austrian school“, Cambridge Society for Economic Pluralism (November 2014)

“The (Quantity) Theory of Money and Credit: Monetarism and von Mises” City University Economics Department Seminar, (November 2012)

The Financial Crisis in the U.K.:  Uncertainty, Calculation, and Error ” CADI, Bucharest (June 2012)

“Establishing the Facts about Austerity” ESCP Europe Research Retreat (August 2012)

“The role of ignorance in economic crises: The UK experience during the great recession” Cal State East Bay (November 2011)

The Financial Crisis in the U.K.:  Uncertainty, Calculation, and Error”, Department of Economics Friday Workshop, San Jose State University (October 2011)

A research agenda for applying Cultural Theory to corporate organizations” Leuven, Belgium (January 2011)

“Liquidity in the age of independence” ESCP-EAP Research Olympics, London (November 2008)

“Towards a Constitutional Theory of the Firm” ESCP-EAP Research Olympics, London (November 2008)

“In Defence of Rational Ignorance: A Subjectivist’s Solution to Public Choice Excess” Foundation for Economic Education, New York (September 2008)

“Comparative Methodology and the Diffusion of Ideas” Anglia Ruskin University, Cambridge (October 2007)

“Towards a Corporate Cultural Theory II” Workshop on Cultural Theory and Management: A Conference held in memory of Prof. Dame Mary Douglas, ESCP-EAP London (July 2007)

“Towards a Corporate Cultural Theory” Conference on Austrian Market-based Approaches to the Theory and Operation of a Business Firm, George Mason Law School (May 2007)

Conference presentations

I have presented at academic conferences such as the European Academy of Management, the Southern Economic Association, and the Association of Private Enterprise Education.

“New authoritarianism and the relevance of public choice. The case of Belarus”, Midwest Political Science Association, Chicago (April 2022) – attended virtually

The Natural Rate of Interest: Estimates for the UKEastern Economic Association, New York (March 2019)

“A strategic plan for the East Belarus mechanical engineering cluster” Association for the Study of Nationalities, Columbia University, New York (May 2018) – not presented

“Ranking Belarus on Competitiveness and Economic Freedom” Association of Private Enterprise Education (APEE), Las Vegas (April 2018)

Economic insights on capitalism, sanctions, and embezzlement: why privatisation matters” Association for the Study of Nationalities, Columbia University, New York (May 2017) – discussant

Choose your own financial crisis” Chartered Association of Business Schools, Bristol (April 2017) – poster

The Microfoundations of Austrian Economics Through a New Classical Theoretical Lens” Mont Pelerin Society, Miami (September 2016)

The Hidden Inflation of the Great Moderation”, Association of Private Enterprise Education (APEE), Cancun (April 2015)

“Reflections on John Blundell” Association of Private Enterprise Education (APEE), Cancun (April 2015)

The Goldilocks Measure of UK Monetary Aggregates: An Introduction to MA“, Southern Economic Association, Atlanta (November 2014)

An Estimate of Gross Domestic Expenditure (GDE) for the UK“, Association of Private Enterprise Education (APEE), Las Vegas (March 2014)

“The (Quantity) Theory of Money and Credit”, Association of Private Enterprise Education (APEE), Maui (March 2013)

“Pedagogical synergies between Austrian Economics and the Case Method”, Association of Private Enterprise Education (APEE), Las Vegas (March 2012)

“Towards a Constitutional Theory of the Firm II” 9th Annual Conference, European Academy of Management (EURAM), Liverpool (May 2009)

“Towards a Constitutional Theory of the Firm” The Association of Private Enterprise Education (APEE), Guatemala City, Guatemala (April 2009)

“In Defence of Rational Ignorance: A Subjectivist’s Solution to Public Choice Excess” 78th Annual Meetings, Southern Economic Association, Washington DC (November 2008)

“Corporate Constitutionalism: Towards a Constitutional Theory of the Firm” 78th Annual Meetings, Southern Economic Association, Washington DC (November 2008)

“An Introduction to ‘Constitutional Management’” Association of Private Enterprise Education, Las Vegas, NV (April 2008) – presented by Nikolai Wenzel

“Austrian Economics Behind the Iron Curtain” Eastern Economic Association, Boston, MA (March 2008)

“Heterogeneous Entrepreneurs, the Monetary Footprint, and the Trade Cycle” 77th Annual Meetings, Southern Economic Association, New Orleans, LO (November 2007)

“A Nomos Model of Social Change: Where Human Action meets Cultural Theory” 76th Annual Meetings, Southern Economic Association, Charleston, SC (November 2006)

“The Diffusion of Economic Ideas in Europe: The Flat Tax (1994-2006)“ Third Annual Graduate Student Conference Idea Exchange: Mediums and Methods of Communication in Eastern Europe, Russia and Central Asia, Graduate Organization for the Study of Europe and Central Asia, University of Pittsburgh (February 2006)

“Ethnic Enterprise Governance“ Conference on Entrepreneurship Research, School of Management & School of Public Policy, George Mason University (November 2005)

The Dutch flower auction

In March 2022 I achieved a long standing ambition – to visit the world famous Dutch flower auction in Aalsmeer. I needed to teach on our Berlin campus and decided to take the Eurostar from London direct to Amsterdam. The Royal FloraHolland building is around 20km from Amsterdam Centraal with good bus routes and, of course, is easy to reach with Uber.

There are really two things that you visit here. The first is a market – you are essentially touring a big warehouse, which is the site for a large share of the global flower trade. But what makes this particular market so special is that it uses a Dutch auction method. While the most famous auctions like Christie’s and Sotherby’s are ascending auctions (the auctioneer gradually raises the price until there’s a winning bidder) the Dutch flower auction uses a descending one. This can often be quicker and therefore more suited to perishable items like fresh produce.

Having pioneered the flower industry in the 17th century, there are several reasons why the Netherlands became the dominant player:

  • Good growing conditions (tulips were first imported to region around 1570 and the sandy, coastal grounds are conducive for flower cultivation)
  • Good transport links (historically this was the river and canal system that linked the sea port to the heart of Europe, more recently this includes Amsterdam’s Schipol Airport, which since the 1960s has provided direct flights to important markets such as New York and Tokyo)
  • A strong financial centre (the Amsterdam stock market is the oldest in the world)

Unfortunately, I arrived too early and had to wait for the visitor centre to open:


The building is very large and the tour takes place along an elevated walkway – the first part is above some empty trolleys:

I wasn’t sure if these flowers were arriving or leaving but you can see that some of the logistic system is automated:

The overhead shuttle system allows sold flowers to be carried outside the premises, and avoid having to be loaded and unloaded onto vehicles:

Some of the flowers are boxed up while some are open. Those in boxes are subject to inspection to ensure that buyers are receiving a quality product.

I really enjoyed watching the activity taking place – the scooter drivers wear headsets to tell them where to go:

I realised that I should have been recording in landscape – this is my favourite video, showing how markets look chaotic but lead to a spontaneous order:

Here are some key facts and figures:

This graphic shows that the biggest import country is Kenya.

Here is a time-lapse of the trolleys:

…”we’ve got to keep on moving”!

The buggies are electric and here’s where they get stored:

This is my favourite photo from the tour:

Here is my overview of how the auction mechanism works:

When I was touring the site, I thought that the physical auction room was no longer in use. Here is a photo of it:

In fact, the auction room is still used sometimes, it’s just that most of the traders who are on site prefer to access the system from their own back offices:

Right at the end of the tour I discovered the old auction room. This was used when all traders had to physically assemble on site.

At the end of the tour there’s an interactive exhibit to learn how the clock works. Here I am having a go:

This is the official Royal FloraHolland video showing how the Dutch clock works:


Right at the back of the hall is a loading area:

After the tour I reflected on the relevance of the auction within the broader Dutch flower cluster:


Finally, here is the new trailer for Royal FloraHolland. Do you think I managed to get a ride on the trolleys??

I hope you enjoyed the tour!

You can test you knowledge of the Dutch flower auction with this quiz:

More resources:

Porter, M.E., Ramirez-Vallejo, J., and Van Eenennaam, F., ‘The Dutch Flower Cluster’, Harvard Business School Case No. 9-711-507, November 2013 (and teaching note).

Here is why the Dutch Flower Cluster case is so relevant:

  1. The Netherlands is one of the twenty largest economies in the world and is a leading global knowledge economy
  2. Agriculture and food are one of the leading industries in the Netherlands and the flower cluster accounts for 43% of the global cut flower exports
  3. The Netherlands accounted for over 80% of the flowers imported in Germany (30%), UK (21%), France (9.65), Denmark (2.7%), Switzerland (3.1%), Italy (4.3%), Austria (2.5%), and Poland (2,7%).

This page can also be viewed as a Twitter thread.

Central banks and digital transformation

Lecture handout: Central banking and digital transformation*

We are seeing unprecedented innovation in payment technologies, with disruptive firms encroaching on activities that many think should be left to central banks. But why not think creatively about the opportunities and threats from decentralised money? What is the proper role of a monetary authority in a system that is fit for the twenty first century? This lecture equips students with the skills to take a radical look at contemporary issues that relate crypto currencies and central bank activities.

Prerequisite: I assume that you have some familiarity with basic concepts from money and banking, and know about and understand Blockchain and Bitcoin. If you don’t, see here:

Money and (central) banking

Key readings:
Recommended podcasts:
Current policy relevance:

In response to the 2022 Fed paper, George Selgin wrote a briefing paper that advocated expanding the set of providers that the Fed deals with, to obtain the competition and innovation that comes from the private sector without the Fed having to issue their own digital currencies. Stablecoin issuers do not require the same regulatory oversight as traditional banks, by providing access to the Fed’s system they simply need to ensure that they fully back their coins with central bank reserves (and possibly short term Treasury certificates). This would require:

  • Bank licenses should be available to non-traditional banks (i.e. institutions that don’t do all of the activities typically associated with a bank, such as maturity transformation)
  • The Fed should allow fintech companies to have master/settlement accounts (which the Bank of England did in 2018)
  • For more see: Selgin, G., “A ‘narrow’ path to efficient digital currency”, Cato Briefing Paper No. 134, February 9th 2022
Other country case studies

Here’s a website that keeps track of interest in CBDCs around the world:

Learning Objectives: Provide an assessment of central bank responsibilities in the digital currency landscape. 

Cutting edge theory: Assessing current policy relevance of central bank activities.


I have contributed to a number of policy debates and have received notable coverage in the following areas:

  • Competitiveness and entrepreneurship policy
  • Flat taxes, corporation tax and public finance
  • NGDP targets and free banking

My work on nuclear energy, and the potential role of SMR’s for Croatia, was covered by Open Access Government. And my advice on competitiveness was presented in a joint conference with the Minister of Finance.

My call for the Bank of England to abolish the Monetary Policy Committee was covered on the front page of the The Daily Telegraph and City AM and prompted an invitation to give a guest lecture to the Bank’s staff. I provided a comprehensive proposal for the UK to adopt nominal GDP targeting and it was covered by Forbes, CNBC, Bloomberg, Moneyweek, and discussed on Bloomberg TV.

I served on the 2020 Tax Commission which advocated a single income tax, and won the $100,000 2013 Templeton Freedom Award. My back of the envelope calculations on the counter intuitive idea that corporation tax harms workers was featured on Page 3 of The Sun, and contributed to the fact that from 2012-2017 the UK government cut it from 28% to 19%. This coincided with revenues rising by 44%. In September 2022 the government decided to keep corporation tax at 19%, for more see here.

Policy reports

What happened in Belarus?” GCRF COMPASS Policy Brief, 25 November 2021

Harnessing nuclear power to meet Croatia’s energy needs” Energy Management Centre Working Paper No. 32, July 2020

  • Submitted to the lead project coordinator for the International Atomic Energy Agency Technical Cooperation Project RER2017, July 2020 (for some background see here).
  • Covered by Open Access Government, January 22nd 2021 (see here)

A Belarus Monetary Perspective” Markets and Money Advisory, March 2018

Monetary Policy After the Crash” Adam Smith Institute, February 2018

Sound Money: An Austrian proposal for free banking, NGDP targets, and OMO reforms” Adam Smith Institute, 2016

In Search of Austerity: An Analysis of the British Situation” Mercatus Center, October 2012

The Single Income Tax” 2020 Tax Commission, May 2012 [I served as a commissioner]

  • Winner of the 2013 Templeton Freedom Award
  • “Business backs single income tax rate of 30%”, Financial Times
  • “Boost growth with 30pc flat rate, Osborne told”, Daily Telegraph
  • “Plan for 30% levy and end of stamp duty; The single tax rate”, The Times
  • “Tax shake-up urged to empower consumers and kick-start growth”, The Independent
  • “The Tax Reform Britain Needs”, Wall Street Journal Europe
  • “Calls for single 30% tax rate”, Daily Mail
  • “Tax cuts ‘booster'”, The Sun
  • “Demand for tax shake-up to aid recovery”, Sunday Express
  • Also covered by Sky News, BBC Two’s Daily Politics, BBC News Channel, ITV News.

Corporation Tax” 2020 Tax Commission Briefing Note, April 2011

  • Also covered on Page 3
  • Impact: in 2008 the rate of corporation tax was 28%. In 2011 successive UK governments started to reduce it, firstly to 26% and then to 24% in 2012, 23% in 2013, 21% in 2014, 20% in 2015, and 19% in 2017. During this period tax revenue rose by 44%. The experience during the 2010s is that lower rates coincided with higher revenues. See here for more.

Public Attitudes to Banking” The Cobden Centre, June 2010

2 days, 2 weeks, 2 months: A proposal for sound money” The Cobden Centre, June 2010

Enterprising Britain: Building the enterprise capital of the world” (with Davide Sola and Adina Poenaru), independent report for the Conservative Party, February 2008

See the interim report, published in October 2007, here.

Are Tesco Acting Competitively?” (with Toby Baxendale), submitted to the Competition Commission, December 2007 [Groceries Market – Third Party Submissions]

Sharpening the Thinking on the UK Audit Industry”, submitted to the Financial Reporting Council, May 2006 [Responses to Discussion Papers]