Syllabus. Economic Principles of Policy Analysis, Heinz College Carnegie Mellon University Spring 2018 Professor Gaynor
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1 Basic Information Syllabus Economic Principles of Policy Analysis, Heinz College Carnegie Mellon University Spring 2018 Professor Gaynor Class Meetings W, 6:00-8:50pm, HbH 1006 TA Sessions Sat, 10:00-11:20am, HbH 1005 Instructor Martin Gaynor HbH 3008, Office Hours: TBA Teaching Assistant Office Hours Textbook Kole Reddig Office Hours: TBA TBA, or by appointment. If you want to see me, send me an to set up a time. Principles of Microeconomics, A Streamlined Approach by Robert Frank, Ben Bernanke, Kate Antonovics, and Ori Heifetz, 3rd edition, New York: McGraw-Hill, (You can use an earlier edition if you wish, but I can t vouch for comparability with this edition.). Students are expected to read the assigned portion(s) of the text prior to the class meeting. You are encouraged to peruse the media for material covering topics on economics and economic policy, and to suggest articles or ideas that you would like to discuss. Course Website Go to and navigate to the course site from there. All assignments will be posted and turned in via Canvas.
2 Course Description Microeconomics is the study of how individuals and firms make choices, and how these choices interact in society. Economics shares with other behavioral sciences the general goal of explaining and predicting human behavior. The distinguishing feature of the economic approach is the emphasis on rational decision making under conditions of scarcity. This course is an introduction to the basic concepts and tools of microeconomics. We study how markets work, with an emphasis on analysis of the effects of public policy on the welfare of society. Upon successful completion of this course a student will: Be familiar with microeconomic concepts and analysis that are essential to good managerial and policy decisions. Be able to use economic analysis in evaluating public policy issues. Be able to apply these concepts and analysis in other courses taken at Heinz, e.g., Management Science, Financial Analysis, Budgeting and Management Control Systems, Negotiation, Public Policy and the Internet, Systems Synthesis, etc. Be able to critically evaluate economic arguments in public policy debates. You should be able to understand and critically evaluate articles and op-eds about economics in the New York Times, Wall Street Journal, etc. You will be able to impress and amaze friends and family with your deep insights and critical understanding of current economic events when such discussions arise over the cheese dip or arguing with your Uncle Edgar. Prerequisites There are no prerequisites for this course. However, in this class there is extensive use of graphs and basic algebra. It is assumed that you are comfortable with these tools. Evaluation The course grade will be based on the following: 3 equally weighted examinations (25% each), homework (20%), and class participation (5%). The exams are not cumulative (but the material is). Each exam will cover new material from class and the readings up to that point (e.g., Exam 2 will not test you on material covered on Exam 1). You may bring a cheat sheet consisting of 1 sheet of 8 ½ X 11 paper to the exams, with anything you want written on it. Students may be excused from an exam only if arrangements are made in advance or if there is an unforeseen emergency. If you miss one of the first two exams (for legitimate and documented reasons, e.g., serious illness, travel for work, job interview) 2
3 there will be no makeup the other exams will count for all of your exam score for the class. For example, if you miss exam 2, exam 1 and exam 3 will each count 37.5% (for 75% exam total), rather than 25%. The third exam is mandatory. It will be held during finals week. Heinz has not yet announced the dates and times for final exams. Do not make travel plans for anytime during finals week. You must be here to take the 3 rd exam. While you may study together for exams (indeed I encourage you to do this), collaboration is not permitted on any exam. Homework assignments are due by midnight on the date specified. You will have one week to complete the assignment. Homeworks will be posted on the Canvas course website. They must be turned in via Canvas. Late assignments will receive no credit. They may be corrected at the discretion of the TA. The lowest homework score will not count towards the course grade (including late or missed assignments. You may work with others on the homework. While the problems may be worked on in groups, you must hand in your own copy of the answers written in your own words. You are permitted to work in groups on the homework assignments that involve problem sets. This collaboration should take the form of working together to understand the question and discuss the answer. However, you may not copy another student s answers for any assignment nor allow your answers to be copied. You must submit the answers in your own words constructed independently. If you copy something as part of any graded submission and fail to properly reference it or to acknowledge that it is not your own creation, you will be considered to have plagiarized that material. You are responsible to know what proper referencing means. The material provided to you by the College as part of your orientation contains this information. If you have any questions, ask me or the program director prior to making a submission. The Dean s guideline for grades in this class (standard core courses) is a class average of (B++). Classroom Policies Please do your best to attend class and arrive on time. If you arrive late or need to leave class early, please sit at the end of a row near the door to minimize class disruption. Cell phones must be silenced for the duration of class unless you are a parent or caregiver, or have discussed the need to be available by phone with the instructor. In any of those cases please set your phone to vibrate, if possible. No use of electronic devices (laptops, cell phones, etc.) is permitted in class, unless by prior arrangement with the instructor, with the exception of calculators. Research studies show that students do not learn as well when using electronic devices. 3
4 Policy on Academic Misconduct Every student is responsible to know and abide by all policies regarding academic misconduct of the Heinz College. If you are found to be cheating, plagiarizing or engaged in any form of academic misconduct in the preparation of materials that are evaluated for grading purposes you will receive zero credit for that assignment or exam. I reserve the right to impose a more severe penalty (e.g., failing the course) should the misconduct warrant it. In addition, you will be referred to the Dean or Associate Dean for possible additional disciplinary action, up to and including expulsion. Accommodations If you wish to request an accommodation due to a documented disability, please inform me and contact the Office of Disability Resources as soon as possible. Instructions for obtaining an accommodation are here, The Office of Disability Resources can be reached at access@andrew.cmu.edu or (412) Take Care of Yourself Do your best to maintain a healthy lifestyle this semester by eating well, exercising, avoiding drugs and alcohol, getting enough sleep and taking some time to relax. This will help you achieve your goals and cope with stress. All of us benefit from support during times of struggle. You are not alone. There are many helpful resources available on campus and an important part of the college experience is learning how to ask for help. Asking for support sooner rather than later is often helpful. If you or anyone you know experiences any academic stress, difficult life events, or feelings like anxiety or depression, we strongly encourage you to seek support. Counseling and Psychological Services (CaPS) is here to help: call and visit their website at Consider reaching out to a friend, faculty or family member you trust for help getting connected to the support that can help. 4
5 TENTATIVE COURSE SCHEDULE 1. Introduction Economics, Economic Decision-making, Supply and Demand. January 17, 24 Thinking Like an Economist: Frank et al. Ch. 1 Supply and Demand: Frank et al. Ch. 2 Working with Equations, Graphs, and Tables: Ch. 1 Appendix The Algebra of Supply and Demand: Ch. 2 Appendix 2. Elasticity, Demand, Supply January 31 Readings: Frank et al., Chapters 4, 5 Homework 1 Due Thursday, February 1 by midnight 3. Firm Supply and Perfect Competition January 31, February 7 Readings: Frank et al., Chapter 6 Homework 2 due Thursday, February 8 4. Imperfect Competition February 14 Readings: Frank et al., Chapter 7 Homework 3 due Thursday, February Imperfect Competition, continued; Catch-up February 21 Readings: Frank et al., Chapter 7 Homework 4 due Thursday, February 22 First Exam Wednesday February Game Theory March 7 Readings: Frank et al., Chapter 8 MARCH 10 NO TA SESSION: SPRING BREAK MARCH 14 NO CLASS: SPRING BREAK 7. Game Theory, continued 5
6 March 21 Readings: Frank et al., Chapter 9 8. Catch-Up March 28 Homework 5 due Thursday March 29 Second Exam. Wednesday, April 4 9. Externalities April 11, 18 Readings: Frank et al., Chapter 9 Homework 6 due Thursday, April Economics and Policy April 25, May 2 Readings: Frank et al., Chapter 10 Homework 7 due Thursday, May 3 Third Exam Finals Week, May 7 May 14, Exact Date TBA. 6
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