modern microeconomic theory. It presents fundamental tools of optimization
theory and equilibrium analysis, neoclassical models of consumer and firm
behavior ...
Syllabus for ECON 601, Section 01 Microeconomic Theory I Fall 2013
Course: Econ 601, Microeconomic Theory Lecture: TTh 8:00 a.m. to 10:00 a.m. Meeting Place: Flanner Hall 824 Instructor: Terence Johnson Office: Phone: Email: Web Page: Office Hours:
917 Flanner Hall (574) 631-2559
[email protected] http://nd.edu/∼tjohns20/micro601.html Tuesday, 10:30-11:30, Thursday 10:30-11:30, and by appointment
ECON601: This is the first part of a two-course sequence covering the fundamentals of modern microeconomic theory. It presents fundamental tools of optimization theory and equilibrium analysis, neoclassical models of consumer and firm behavior, and analysis of decision-making under uncertainty. Prerequisites: Undergraduate calculus sequence and linear algebra Required Text: Microeconomic Theory, by Mas-Colell, Whinston and Green, and either Fundamental Methods of Mathematical Economics by Chiang and Wainwright or Mathematics for Economists by Simon and Blume. Course Notes: Available at the course web site Homework and Exams: Late homework will not be accepted, unless the student arranges for an exception in advance or provides evidence of an unforeseen and unavoidable circumstance that prevented submitting work on time. There will be two midterm exams and one final exam. 1
Grading: There will be regular homework assignments, successful completion of which counts for 10 percent of your grade. There will be three exams, each worth 30 percent. One will focus on optimization and comparative statics, one will focus on consumer and firm behavior, aggregation, and welfare, and the final exam will be cumulative as well as include material on decision under uncertainty, and partial equilibrium models. Absences: This is a demanding class, intended to prepare students for independent research in economics. Absences put you behind schedule, and can severely interfere with your ability to succeed in the course. Cheating and Plagiarism: Cheating and plagiarism will not be tolerated in any form. Any violation of the academic code of honor will result in a punishment proportional to the crime, as determined by the instructor and student or through the Honesty Committee process. Expectations: This is a challenging course. The expectation is that students will work to the best of their ability, participate actively in class, and seek help from the other students or instructor when they have trouble understanding material. Unlike undergraduate courses, this class is not intended to introduce you to new ideas and methods, but to push you to master a subject and grow as a thinker, researcher, and economist. Other Resources: The course text — MWG — is very dense, and its organization can be confusing at times. However, it is the standard, and presents ideas at the level of understanding required of a professional economist. However, there are many other books that may be helpful in learning the economic and mathematical material in the course, and if you find a topic difficult, it can be very helpful to see it presented in a different way. I am very familiar with the following books, and would be happy to work through questions you have from them, MWG, or in general: • General “Math-for-Econ” Books: You should own at least one of these books for reference purposes. They typically contain some analysis, linear algebra, optimization theory, differential equations, and probability. Mathematics for Economists by Simon and Blume is the standard, and has a lot of very useful material. Fundamental Methods of Mathematical Economics by Chiang and Wainwright is somewhat easier, and covers less material. • Microeconomic Theory: The course will be taught from MWG, but Varian’s Microeconomic Analysis presents many of the topics in a better organized and more readable 2
fashion. Varian does a very good job of presenting in two or three pages what MWG devote an entire chapter to, at the cost of the depth and rigour that MWG provide. So if you find MWG daunting and you are making little progress with it, consider Varian or Kreps’ Microeconomic Theory. • Analysis and Optimization: The best book for a self-contained and readable introduction to optimization theory is Sundaram’s A First Course in Optimization Theory. de La Fuente’s Mathematical Models and Methods for Economists is also good, but more advanced. Before you buy any additional books, remember that the library has many of them available, and I own almost all of these and can lend them to you for a few days. On the other hand, if you find a good book, I recommend buying it and making a habit of writing notes to yourself in the margins to clarify things you have trouble understanding, or important missing steps in proofs. Schedule: We will spend a week to two weeks on each of the following: • Optimization and Comparative Statics (MWG Appendix, Varian 27) • EXAM 1 • Fundamental Mathematical Concepts and Choice Theory (MWG 1, Varian 8) • Utility Maximization and Consumer Behavior (MWG 2,3, Varian 7, 9, 10) • Profit Maximization and Firm Behavior (MWG 5, Varian 2, 3, 4) • Aggregate Demand and Supply (MWG 4, 5E, Varian 9) • EXAM 2: Models of Consumer and Firm Behavior • Choice Under Uncertainty (MWG 6, Varian 11) • Partial Equilibrium in Competitive Markets (MWG 10, 22bcd, Varian 13, 22) • Selected Topics: Externalities, Monopolistic Screening, Monopolistic Competition, Adverse Selection • FINAL EXAM 3
