Courses in Economics (Division 358: arranged by groups)

A. Introductory Courses

201. Principles of Economics I. No credit granted to those who have completed 400. (4). (SS).

Economics 201 concentrates on the microeconomics of the modern economy: how markets function under competitive conditions as well as with various other types of market organization; the distribution of income and wealth; the public sector; socialism; and related topics of current interest. The course format consists of three one-hour lectures per week (either Section 100, 200, 300) taught by the professor and one hour of discussion per week (Section 101-116, 201-216, 301-316) taught by the teaching assistants. Grades are based largely on course-wide hour tests and the final exam, but there will be quizzes in the sections. Economics 201 is the first part of the two-term introduction to economics. Both 201 and 202 are required as prerequisites to the concentration and to upper level courses in economics.

202. Principles of Economics II. Econ. 201. No credit granted to those who have completed Econ. 400. (4). (SS).

Economics 201 and 202 are required as prerequisites to the concentration and to upper-level courses in Economics. In Economics 202, the fundamental concepts and theories of macroeconomics are developed and used to analyze problems of current interest. The major concerns of this course are the determinants of GNP, unemployment, inflation, international trade, and economic growth. The course format consists of one hour of lecture (either 001 or 002) each week by the professor and three hours of section meetings (003 to 035) each week by a teaching assistant. The section meetings are limited to 35 students. (Courant)

B. Economic Theory and Statistics

401. Intermediate Microeconomic Theory. Econ. 201 and 202, and Math. 115. (4). (SS).

This course deals with the theoretical analysis of consumers, firms, markets, and price determination. The analysis is rigorous, using the tools of algebra, geometry, and elementary calculus in constructing models. Prerequisites include one term of calculus. Economics 401 is a prerequisite for many other courses offered in Economics. Concentrators are required to elect this course and are encouraged to complete it early in their concentration program. It is not recommended that 401 and 402 be taken in the same term. Main lecture will meet twice a week. Sections will meet once a week. (Varian)

402. Intermediate Macroeconomic Theory. Econ. 201 and 202, and Math. 115. (3). (SS).

This course in macroeconomics deals with the theory of broad economic aggregates such as national income, employment, the price level, and the balance of payments. Rigorous analysis is used to understand the forces that determine these economic variables, and how they are affected by public policies. It is predominantly a lecture course, with grades based on hour test(s) and final exam. Prerequisites include one term of calculus. Economics 402 is a prerequisite for many other courses offered in Economics. Concentrators are required to elect this course and are encouraged to complete it early in their concentration program. It is strongly recommended that students take Economics 401 before 402.

403. Advanced Economic Theory. Econ. 401 and 402. (3). (Excl).

This course will consist of an introduction to the subject of game theory. Game theory has become an important technique for studying competitive and cooperative phenomena in economics and the social sciences. Traditional economics emphasizes the two extremes of economic decision-making: perfect competition, in which no firm can affect market prices, and pure monopoly, in which one firm has complete price-setting power. Game theory is a technique which allows intermediate situations to be analyzed: for example those that arise during wage negotiations or in price wars between two large firms. The same principles that govern the strategic interaction of players in parlor games like Chess or Poker turn out to be widely applicable to a whole range of such phenomena in economics, biology, and political science. The current course will explore the beginnings of the subject using simple illustrative examples. Some calculus and matrix algebra will be needed, but the mathematical requirement is more for some sophistication in methods of argumentation rather than for specific techniques. Parlor games including Chess. Chance and information. Zero-sum games. Poker. Fixed points and equilibria. Coordination and cooperation. The evolution of cooperation. Bargaining. Cooperative and noncooperative games and their application in the social sciences. Course grade is based on final examination (60%), midterm (30%), and homework assignments (10%). Prerequisites include calculus and matrix algebra. The course is open to inquisitive undergraduates and others, mostly but not necessarily economics concentrators. (Binmore)

404. Statistics for Economists. Econ. 201 and 202; or permission of instructor. No credit granted to those who have completed 405. (4). (Excl).

SECTION 001. This course is designed to enable students to read critically empirical literature in economics and other social sciences. Topics covered include descriptive statistics, elementary probability theory, statistical inference, and regression theory. Data analysis and interpretation of quantitative results will be emphasized. There are two lectures and one problem session per week. Grades are based on problem sets and exams. The course, which is self-contained, does not serve as a prerequisite to Economics 406. (Howrey)

SECTION 002. This course is designed to enable students to read critically empirical literature in economics and other social sciences. Topics covered include descriptive statistics, regression theory, elementary probability theory, and statistical inference. This course will emphasize data analysis and interpretation of quantitative results. There are two lectures and one problem session per week. Grades are based on problem sets and exams. The course, which is self-contained, does not serve as a prerequisite to Economics 406. (Gerson)

405/Statistics 405. Introduction to Statistics. Math. 115 or permission of instructor. Juniors and seniors may elect this course concurrently with Econ. 201 or 202. No credit granted to those who have completed 404. (4). (Excl).

This course has originally been designed for economics concentrators but the discussion is sufficiently general to serve noneconomics concentrators just as well. The emphasis is on understanding rather than on "cookbook" applications. Students are expected to know basic algebra and basic calculus. Since the content of the course does not extend much beyond establishing the foundations of statistical inference, it is recommended that after finishing the course students elect to take Economics 406 or a similar course in the Statistics Department to learn some applications and get some experience with computer work. This course is designed for quantitatively oriented students who are comfortable with abstract concepts. Students who prefer a broader, less rigorous approach to statistics should elect Econ. 404. (Kmenta)

407. Marxist Economics. Econ. 201 and 202. (3). (Excl).

This course provides an introduction to Marxian and neo-Marxian analysis of capitalistic society in general and contemporary U.S. capitalism in particular. The first part of the course will be devoted to classical Marxian economics, drawing on readings from the works of Marx and Engels as well as modern sources. The second - and major part of the course will focus on contemporary neo-Marxian political economy, drawing from the writings of modern radical economists and other social scientists working within the Marxian tradition. Grades will be based on one midterm and one final examination. The course does not fulfill the departmental sequence requirement. (Weisskopf)

501. Microeconomic Theory. Econ. 401 or permission of instructor. (3). (Excl).

This is a course in applied microeconomic theory, and the course content is focused in a series of applied cases. The cases will be supplemented by short weekly student papers which do not add to the course grade but can detract from it. Topics studied will include: theory of taxation; risk management; public investment policy; various public policies relating to wages, taxes, and prices. Course grade: 20% for a midterm exam; 35% for the final examination; 45% for a course paper. There will be a course pack and supplementary text. Office hours by appointment. (Cross)

C. Economic Stability and Growth

411. Money and Banking. Econ. 402. No credit granted to those who have completed or are enrolled in 310. (3). (Excl).

SECTION 001 AND 002 Economics 411 focuses on modern financial markets and the role of monetary policy in influencing asset prices and the economy. Monetary and financial economics are developed at a formal level using math quite intensively. Topics covered include financial institutions and markets, interest rate determination, portfolio theory, efficient capital markets, the money supply process, money demand, monetary policy, and macroeconomics from a systems-theory perspective. Evaluation will be based on homework assignments, two midterms and the final exam. Method of instruction is lecture and discussion. Economics 411 is the first course in a departmental sequence; the other course in the sequence is Economics 412. The prerequisite is 403, Intermediate Macroeconomics, and some course in statistics. It is also helpful to have had 401, Intermediate Microeconomics. (Kimball)

412. Stabilization Policy. Econ. 402. No credit granted to those who have completed or are enrolled in 310. (3). (Excl).

This course will consist of an intensive examination of several puzzling empirical phenomena involving interest rates, stock yields, commodity prices, and money. Many of the puzzles are classic problems in monetary theory, although a few are of recent vintage. For each of the phenomena we will ask: (a) Why is this puzzling from the point of view of standard monetary theory? (b) What theoretical explanations have been advanced? and (c) Which implications of each of these theories are or are not borne out by the data? We will begin with the classic Gibson Paradox, made famous by Keynes - the observation that the nominal interest rate and the level (not the rate of change) of prices were correlated over long periods of economic history. The mirror image of the Gibson Paradox is the apparent failure of nominal rates to adjust for inflation during the same periods, and we turn our attention to this puzzle next. From here we move naturally to the coexistence of negative real interest rates on bonds with very low stock prices (and high dividend and earnings yields) in the 1970's. The remainder of the course will concentrate on the central problem in monetary theory why is it that changes in the nominal money stock appear to have potent effects on the real economy. The course prerequisite is Economics 402, although it will be very helpful to have had 401 and at least one other 400 level course. There will probably be one or two examinations, and a term paper which must be brief but which should include a small bit of original research.

D. Labor Economics

421 Labor Economics I. Econ. 401. No credit granted to those who have completed or are enrolled in 320 or 326. (3). (Excl).

This course deals with the economics of labor supply and demand, wage and employment determination and investment in education and training, unemployment. The course develops microeconomic models of the labor market, presents relevant empirical evidence, and discusses applications to such policy issues as the work incentive effects of income maintenance programs and the employment effects of minimum wage legislation. Grades are based on midterm and final examinations. (Brown)

E. Industrial Organization and Public Control

333. Economic Analysis of Industrial Policy. Econ. 201 and 202. (3). (Excl).

This course examines the changing, and developing, international economy, its consequences for the United States economy, and the demands for an "Industrial Policy" to address these consequences. Topics include: macroeconomic fluctuations and trade patterns, trade and proposed barriers to trade, anti-trust in international markets, labor market dislocations and adjustments, automation and research and development. Emphasis is placed on the interacting economic and political dimensions of these topics. Writing or debate presentation required as well as a midterm, final, and occasional problem sets. (Stafford)

431. Industrial Organization and Performance. Econ. 401. No credit granted to those who have completed or are enrolled in 330. (3). (Excl).

An analysis of the behavior and social performance of firms. Emphasis is placed on understanding how firms compete with one another. Topics include why firms exist, oligopoly theory, differentiated products, entry deterrence, collusion, advertising and trademarks, mergers and expenditures on research and development. There will be a midterm and a cumulative final exam. (Bagnoli)

432. Government Regulation of Industry. Econ. 401. No credit granted to those who have completed or are enrolled in 330. (3). (Excl).

SECTION 001 This course studies government policies toward business. Government intervention in private business takes three forms in the U.S.: antitrust laws, direct regulation of prices and outputs, and safety and information regulation. In antitrust, we look at the laws and their enforcement on issues of monopolization, price fixing, mergers and other market restrictions. Direct economic regulation of specific industries is then examined. We will study the electric power, airline, securities brokerage, and telecommunication industries. Finally, we look at issues of unfair or deceptive advertising, health and safety standards for products and work places, and environmental protection. (Borenstein)

Section 002. This course describes and analyzes public policies toward monopoly power. Emphasis is placed on the American environment, especially antitrust law and regulatory commissions; but some attention is devoted to Western Europe. Knowledge of material covered in Economics 431 will be presumed. Classes will be conducted in the Socratic manner. (Adams)

438/HSMP 661 (Public Health). Economics of Health Services. Econ. 401 or permission of instructor. (3). (Excl).

This course provides an analysis of the medical sector in the U.S. It starts with an examination of medical services as one input in a production function for health. The emphasis of the course is then on the efficiency with which medical services are produced, public policies, and the financing of medical services. Specific topics include the demand for medical care, hospitals, physicians, nurses, medical education, regulatory and competitive strategies to improve efficiency, and national health insurance. Lecture format. Three exams. (Berki)

F. International Economics

340. International Economics. Econ. 201 and 202. No credit granted to those who have completed or are enrolled in 441 or 442. (3). (Excl).

Survey of the major aspects of international trade and international finance. Emphasis is on an overview of international economics, rather than on detailed analysis. Topics covered include the basis for international trade, the effects of international trade policies, foreign exchange markets, the determination of national income in an open economy, and international effects of macroeconomics policies. (Deardorff)

441. International Trade Theory. Econ. 401 or the equivalent. No credit granted to those who have completed or are enrolled in 340. (3). (Excl).

Static and dynamic determinants of comparative advantage; trade policy and economic welfare; selected topics. (Stern, Levinsohn)

442. International Finance. Econ. 402 or the equivalent. No credit granted to those who have completed or are enrolled in 340. (3). (Excl).

The course deals with macroeconomic analysis and issues for an open economy. Topics include: the foreign exchange market and the balance of payments; the income-absorption and monetary-asset market approaches to national income determination and the balance of payments; macro-stabilization policies and central bank intervention under fixed and floating exchange rates; Eurocurrency markets; monetary integration; and reform of the international monetary system. Grading will be based on two midterms and a final exam. There will be optional homework assignments. Economics 441, the other half of the international sequence, is not a prerequisite.

G. Comparative Economic Systems

350. Comparative Economic Systems. Econ. 201 and 202. No credit granted to those who have completed or are enrolled in 451. (3). (Excl).

Theoretical models and case studies of selected aspects of different economic systems, including (1) capitalist regulated market economies, (2) socialist regulated market economies, and (3) socialist centrally planned economies. Assigned readings and lectures. Two examinations. NOT in departmental concentration sequence in Comparative Economic Systems. (Bornstein)

451. Comparative Analysis of Economic Systems. Econ. 401. No credit granted to those who have completed or are enrolled in 350. (3). (Excl).

Designed for students with a background in intermediate microeconomic theory. Covers: (1) methods and criteria for analyzing and comparing economic systems; (2) theoretical models and case studies of a capitalistic market economy, a socialist market economy (with and without workers' management of firms), and a centrally planned economy; (3) Comparative analysis of selected economies' policies and performance; and (4) analysis of current reforms in socialist economies. Reading assignments in various sources; lectures. Two examinations. No papers. In departmental sequence in Comparative Economic Systems. (Dernberger)

453. The European Economy. Econ. 401 and 402; or permission of instructor. (3). (Excl).

The structure and performance of the Western European economies since World War II. Emphasis is placed on using international comparisons to evaluate the effects of governmental policies and national cultures on the behavior of firms and households. Classes will be conducted in the Socratic style. Prerequisites: Econ 401 and 402. Reading knowledge of a European language is useful but not required. (Adams)

454. Economics of Japan. Econ. 201 and 202. (3). (Excl).

Analysis of Japan's economic organization, structure and performance. Special emphasis is placed on the character of Japanese economic planning, the behavior of Japanese enterprises, the Japanese labor force, and the Japanese household. There will also be ample discussion of Japan's international economic relations. Attention will be given to bilateral and multilateral conflicts in overseas product, financial and technology markets. The class has a lecture format, but questions are welcomed. Course grade will be determined by two one hour exams and a final. Can be used with Economics 451, 453, 455, 456, 491, 492 and 493 to meet requirements of Economics concentrators for two course sequence in a field. (Saxonhouse)

456. The Soviet Economy. Econ. 201 and 202. (3). (Excl).

A comprehensive and intensive analysis of the Soviet economy, including (1) economic history; (2) operation and problems in regard to planning, pricing, finance, management, labor, agriculture, and foreign economic relations; and (3) assessment of economic performance. Assigned readings and lectures. Two examinations. May be used (along with Econ. 451) for departmental concentration sequence in Comparative Economic Systems. (Bornstein)

H. Economic Development and National Economies

461. The Economics of Development I. Econ. 402 or permission of instructor. No credit granted to those who have completed or are enrolled in 360. (3). (Excl).

This is the first course in a two-term sequence on economic development, intended primarily for upper division undergraduates from all fields and graduate students from outside economics. The second course in the sequence, Economics 462, need not be taken after this one but it is generally recommended. Economics 461 will involve a general introduction to the subject of economic development (and underdevelopment) that includes theoretical institutional, and historical perspectives. We will discuss problems of human resources, agricultural development, industrialization and foreign trade, income distribution, the debt crisis, as well as development planning and other policy issues. The requirements of the course will include a midterm and final examination. Each student is expected to select a country for special study and write two short reports on that country.

I. Urban and Environmental Economics

370/Nat. Res. 470. Natural Resource Economics. Econ. 201 and 202. No credit granted to those who have completed or are enrolled in Econ. 471 or 472. (3). (Excl).

A one-term pre-professional introduction to Environmental and Natural Resource Economics. Topics include externalities, unpriced goods, cost-benefit analysis, resource scarcity, exhaustible resource depletion, renewable resource harvesting, and common property problems

J. Public Finance

481. Government Expenditures. Econ. 401. No credit granted to those who have completed or are enrolled in 380. (3). (Excl).

This course, together with Economics 482, Government Revenues, constitutes the undergraduate sequence in the field of public economics. The two courses may also be taken independently. Economics 481 studies the productive and allocative role of government and of other aggregations of individuals, as well as the interactions among politics, economics, and ethics. Topics covered include welfare economics, the theory of public goods, collective choice, problems of group decision making, externalities and common pool problems, cost-benefit analysis, and intergovernmental public finance. Depending upon the time available, we may also consider in detail public policies in the areas of pollution and income redistribution. In considering these topics, emphasis will be placed on theoretical as well as on political issues. The class format will combine lecture and discussion, and there will be several discussion assignments for which advance preparation and participation will be expected. (Katz)

485. Law and Economics. Econ. 401. (3). (Excl).

This is a Collegiate Fellows course, emphasizing critical thinking. See page 3 of this COURSE GUIDE for a complete list of Collegiate Fellows courses.

This course analyzes legal issues from an economic perspective. It will cover topics in a variety of legal areas, including torts, contracts, property law and environmental law. For example, the course will ask the question of who should be liable for damage in automobile accident cases in order to give drivers incentives to take an economically efficient level of precaution against accidents. It will ask under what circumstances buyers or sellers should be encouraged to breach contracts and what penalties for breach will encourage them to breach only when such behavior is economically efficient. It will ask how the availability of insurance changes behavior in uncertain situations such as these. A "truth in advertising" proviso: students intending to go to law school should be cautioned that this course will not help in getting admitted there any more than any other economics course will. There will be midterm and final exams, but no paper. Readings will include Cooter and Ullen's LAW AND ECONOMICS and Polinsky's INTRODUCTION TO LAW AND ECONOMICS. (White)

487. Urban Economics. Econ. 401. (3). (Excl).

This course analyzes economic approach to the spatial structure of cities and to urban problems. Topics to be considered include land rent, urban transportation and commuting, urban housing markets, determinants of firm location in cities, local government, environmental problems and urbanization in under-developed countries. There will be a midterm and final exam, but no paper. Readings will include URBAN ECONOMICS, fourth edition, by Mills and Hamilton. (White)

L. Honors Program

498. Senior Honors Seminar. Open only to seniors admitted to Honors concentration in economics. (3). (Excl). (INDEPENDENT).

This is the second term of a two course sequence. The first course is Economics 497, the Junior Honors Seminar offered in the winter term of the preceding year. The Senior Honors Seminar is for senior undergraduates writing senior Honors theses. Class meetings are primarily devoted to student presentations of their thesis research in progress. Students are expected to submit their finished thesis by the last day of classes. Each student's grade for the course and levels of Honors achieved will depend entirely on the quality of the thesis, as evaluated by the course instructor and one other thesis advisor with whom the student has arranged to work. (Stafford)

O. Interdisciplinary Survey Courses

395/Hist. 332/Pol. Sci. 395/REES 395/Slavic 395/Soc. 392. Survey of the Soviet Union. May not be included in the minimum 24 credits required for a concentration in economics. (4). (SS).

See REES 395. (Szporluk)

P. Accounting

271/Accounting 271 (Business Administration). Accounting. Not open to freshmen. May not be included in the minimum 24 credits required for a concentration in economics. (3). (Excl).

This course covers basic financial accounting principles for a business enterprise. Topics include the accounting cycle, merchandising accounts, asset valuation, income measurement, partnership accounting, and corporation accounting.

CSP section available. See the Comprehensive Studies Program (CSP) section in this GUIDE.

272/Accounting 272 (Business Administration). Accounting. Economics 271. Not open to freshmen. May not be included in the minimum 24 credits required for a concentration in economics. (3). (Excl).

This course completes the coverage of financial accounting principles and provides an introduction to management accounting. Topics include investments, long-term liabilities, the statement of changes in financial position, consolidated statements, job-order and process cost accounting, special analysis for management, and standard costs.


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