INTERMEDIATE MICROECONOMICS SYLLABUS

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1 INTERMEDIATE MICROECONOMICS SYLLABUS Patrick Henry College ECO333 Fall 2016 TR, 8:00-9:15 AM Hodel, Classroom 2 (NE) Instructor: Erik W. Matson ewmatson@phc.edu Office Location: Red Hill Basement Office Hours: TR, 9:30-10:30 (or by appointment) I. COURSE DESCRIPTION [As found in the college catalogue] This course builds on many of the concepts and theories learned in ECO303, introducing formal analytical tools that provide additional microeconomic insights. Following this class, students will be prepared to understand and apply intermediate microeconomic principles to individual, firms, and government-decision making. Topics covered include consumer and producer theory, general equilibrium, industrial organization, and game theory, among others. Prerequisite: ECO303. II. COURSE OBJECTIVES The main goal of this course is to develop and sharpen our economic thinking and use such thinking to look at consumer and producer behavior and interaction under various constraints. To that end, we will develop some simple analytical and mathematical tools commonly used in economics (mostly univariate calculus). A second goal of the course is to broadly explore the nature of economics as an intellectual discipline and to understand the important role of economics and of the economist in society. We will examine assumptions about knowledge and behavior that modern economics makes regarding, e.g., preferences, utility, and choice. In the process, we will take a cursory look at some important subfields of microeconomics: behavioral and public choice economics. Here is a list of objectives: 1. Apply economic thinking to consumer and producer behavior under constraints. 2. Develop a set of analytical and mathematical tools to help use economics to understand human behavior. 1

2 3. Develop a high-level understanding of the behavioral and knowledge assumptions of modern economics and a working understanding of some potential shortcomings of those assumptions. 4. Develop a broad understanding of the contribution of economics to social science and to society in general. 5. Develop well-educated perspectives on what economists are and aren t qualified to do. 6. Develop well-informed political maxims given objectives 1-4. III. REQUIRED MATERIALS There are three required texts for the course: 1. Varian, Hal Intermediate Microeconomics: A Modern Approach (9e). New York: W.W. Norton & Co.: 2. Thaler, Richard The Winner s Curse. Princeton: Princeton University Press. 3. Caplan, Bryan The Myth of the Rational Voter: Why Democracies Choose Bad Policies. Princeton: Princeton University Press. There will be additional readings (mostly journal articles) assigned throughout the course. I will post them on the course itslearning site. IV. GRADES Your grades will be determined by participation, homework, and two exams, weighted as follows: Homework: 20% In-class writing assignment 1: 10% Exam 1: 20% In-class writing assignment 2: 10% Exam 2: 40% Participation: < 0.5% Homework: I will assign homework each week. The homework assignments will be a combination of writing and analytical problems. Homework assignments will be scored out of 3 points. Not turning in the homework, or turning in a substantially incomplete assignment that reflects a lack of effort will earn you a 0. Turning in a completed assignment will automatically earn you a 1. Turning in a completed assignment with mostly correct (over 50%) answers that reflects moderate effort put forth will earn a 2. Turning in a completed assignment with almost all correct answers that reflects a high effort level will earn a 3. I do not accept late homework. But I will drop your two lowest homework grades. 2

3 In-class writing assignments: You will have two in-class writing assignments after the first and third parts of the course. The assignments will be short essay form. You will need a Bluebook. I will give more detail about the writing assignments ahead of time. You will have at least a one week notice before the assignment. Exams: The exams will look a lot like the homework assignments. They will be a combination of short essays and analytical problems. Class attendance and homework completion are your best study tools for exam performance. I will let you know the date of your midterm at least two weeks prior. I do not permit make-up exams without substantiation (e.g., doctors note) Participation: Participation can only have a positive effect on your grade. If you are on the border between two grades (within 0.5%), I will round you up to the higher grade if you have participated throughout the semester. Participation is a catch-all category for attendance, active engagement, asking questions, discussing, etc. While not participating will not technically hurt your grade, active course participation is the best study tool for exams and will ensure you get the most out of the course experience. Grading scale (this is a college standard): Letter Grade Quality Percent Grade Quality Points A Superior A B B Above Average B C C Average C D D Below Average F F Failure < WF Withdrawal While Failing 0.00 XF Academic Disciplinary Failure 0.00 VIII. ACADEMIC INTEGRITY (PLAGIARISM AND CHEATING) [As found in the Patrick Henry College Catalog] Integrity of Scholarship The principles of truth and honesty are recognized as absolutely essential in every community of learning. It is expected that these principles will be scrupulously followed in all academic endeavors at Patrick Henry College, including, but not limited to, the preparation of all papers 3

4 and reports and the taking of examinations. All academic work must be done by the student without unauthorized aid. Any compromise of truth or honesty, including, but not limited to, plagiarism, unauthorized collaboration, violation of guidelines under which the work is to be done, fabrication of data, unauthorized use of computer data, submission of a paper twice for the same course, submission of the same paper for multiple courses, and excessive revision by someone other than the student, may be considered sufficient grounds for suspension or expulsion from the College. Students may be given a grade of "XF" if it is determined that they have plagiarized or cheated in a course. The "XF" on a transcript indicates that a student violated integrity of scholarship policies. Students who successfully retake a course for which they have received an "XF" will have the "X" removed from their transcripts although the "F" Letter Grade will remain. The "XF" (or "F") and the grade earned in the retaken course will be used to calculate the grade point average. IX. MATHEMATICAL PREREQUISITES Success in this course requires a solid understanding of univariate calculus. The math in this course should prepare you for success in upper-level undergraduate coursework in mathematical economics and advanced micro theory. If you plan on pursuing a graduate degree in economics, you will need higher-level math skills (at least a strong grasp of multivariate calculus, basic differential equations, and linear algebra). Here are a few recommended resources: 1. Dowling, Edward T Schaum s Outline of Introduction to Mathematical Economics. Third edition. McGraw Hill Education. 2. Simon, Carl P. and Lawrence Blume Mathematics for Economists. W.W. Norton & Company. Basic math skill and understanding requirements (sufficient for this course): 1. Understanding functions: continuous, monotonic, positive, and negative functions. 2. Linear/affine functions: standard form, point-slope form, deriving vertical/horizontal intercept. 3. Logarithms: Basic algebraic manipulation of logs, natural logs. 4. Differentiation: power rule, product rule, quotient rule, chain rule, understanding derivatives as rates of change, intuitive understanding of higher-order derivatives. 5. Partial differentiation: take simple partial derivatives and have an understanding of what a partial derivative is. 4

5 6. Optimization under constraints: deriving first-order and second-order conditions, setting up Lagrangians. X. [TENTATIVE] COURSE SCHEDULE AND READING LIST Here is the basic course schedule. There is a good chance that I will have to cut some material, but we will see how the course progresses Readings should be completed before coming to class. PART I: Understanding Economics To develop a working understanding of the discipline of economics. To understand what sets economics apart as a social science. To discern the most important historical contributions of economics. To understand what economists should be doing. Lecture 1: Course introduction: What is economics? Reading: Course syllabus Lecture 2: The economic problem Reading: F.A. Hayek, The Use of Knowledge in Society. Optional Reading: F.A. Hayek, Economics and Knowledge. Lecture 3: What is the market? Reading: Smith, An Inquiry into the Nature and Causes of the Wealth of Nations, Chapters 1-4. Lecture 4: What should economists do? Reading: James Buchanan, What Should Economists Do? Reading: David Hume, Of Commerce, introduction. IN-CLASS WRITING ASSIGNMENT 1 PART II: Neoclassical Consumer Theory To sharpen our economic thinking as a corrective against ersatz economics. To develop a powerful analytic framework through which we can view human behavior. (And develop the mathematical intuition necessary for success in upper-level economics courses) To highlight the limitations of our ability to model human behavior and predict economic outcomes. To draw attention to some shortcomings of standard neoclassical consumer theory by looking at behavioral economics and thinking about cognition. 5

6 Lecture 5: An introduction to microeconomic modeling Reading: Varian, Chapter 1. Lecture 6: The budget line Reading: Varian, Chapter 2. Lectures 7-8: Preferences: neoclassical vs. behavioral Reading: Varian, Chapter 3. Reading: Thaler, Chapters 6-7. Lecture 9: Utility Reading: Varian, Chapter 4. Lectures 10-11: Choice Reading: Varian, Chapter 5 Reading: Thaler, Chapters 1-2. Optional Reading: Thomas Schelling, The Intimate Contest for Self-Command. Optional Reading: Adam Smith, Theory of Moral Sentiments, Part I, Section I, Chapter I. Lectures 12-15: Demand, market demand, and market equilibrium Reading: Varian, Chapters 6,15,16 MIDTERM Part III: Democracy and Economics To reinforce the importance of economic literacy and underscore what economists should really be doing. To apply the apparatus of neoclassical consumer theory to the world of politics. To understand why democracies often generate wrongheaded economic policies. To understand some major structural differences between markets and governments. To generate sound public policy maxims. Lectures 15-18: The economic frailties of democracy Reading: Caplan, The Myth of the Rational Voter. IN-CLASS WRITING ASSIGNMENT 2 Part IV: Producer Theory To develop a set of analytical tools for thinking about producer behavior. To understand what firms are and why they exist. To understand the conditions for firm profit maximization. To understand monopoly and oligopoly behavior and the conditions under which monopoly threats are or are not credible. 6

7 Lecture 19: Technology Reading: Varian, Chapter 19. Lecture 20: Cost minimization and the theory of the firm Reading: Varian, Chapter 21. Reading: Ronald Coase, The Nature of the Firm. Lecture 21: Cost curves Reading: Varian, Chapter 22. Lecture 22: Firm supply Reading: Varian, Chapter 23. Lecture 23: Industry supply Reading: Varian, Chapter 24 Lecture 24-25: Monopoly and Oligopoly Reading: Varian, Chapters 25-26, 27. FINAL EXAM 7

ECO 3101: Intermediate Microeconomics

ECO 3101: Intermediate Microeconomics Spring Semester 2016 Syllabus Instructor: Alberto Ortega Time: T&Th 4:05pm-6:00pm Email: aorte013@ufl.edu Place: MAT 112 Course Pages: 1. http://elearning.ufl.edu/