Courses in Economics (Division 358)

A. Introductory Courses

101(201). Principles of Economics I. No credit granted to those who have completed or are enrolled in 400. (4). (SS). (QR/2).

Economics 101 examines the microeconomics of capitalism the behavior of households and businesses and the generation of prices and outputs in markets. Specific topics in Economics 101 include: supply and demand; the differences between competition and monopoly; labor markets and discrimination; the distribution of incomes and poverty; environmental problems and policies; and government taxation and expenditure issues. Economics 101 is the first part of the two-term introduction to economics the second part (Economics 102, for which Economics 101 is a prerequisite) examines macroeconomics. Prerequisites for 101: high school algebra and geometry and a willingness to use them. The course format consists of large lectures taught by the professor and one small one-and-a-half-hour section meeting per week taught by a graduate student instructor. Cost:2 WL:1 (Gerson, Laitner, Porter, Morgan)

Section 300 only. The course format consists of three large one-hour lectures per week taught by the professor and one small one-and-a-half-hour section meeting per week taught by a graduate student instructor. Final grades will be based on: quizzes given during section meetings (20%); two hour tests (40%); and the final exam (40%). NOTE the DATES and TIMES of the two hour tests and the final exam in the TIME SCHEDULE, and BE SURE that you can attend all three. Cost:2 WL:1 (Porter)

102(202). Principles of Economics II. Econ. 101. No credit granted to those who have completed or are enrolled in Econ. 400. (4). (SS). (QR/2).

Economics 101 and 102 are required as prerequisites to the concentration and to upper-level courses in Economics. In Economics 102, 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 GDP, unemployment, inflation, international trade, and economic growth. The course format consists of three hours of lecture per week (either 100 or 200) by the professor and one and a half hours of section meetings (101-109 or 201-212) each week by a teaching assistant. The section meetings are limited to 35 students. Cost:2 WL:Contact Undergraduate Office, Dept. of Economics, 158 Lorch Hall (Section 100:Courant; Section 200:Johnson)

108. Introductory Microeconomics Workshop. First-year standing and concurrent enrollment in Economics 101. (1). (SS). Offered mandatory credit/no credit.

Students will meet weekly for one hour with a faculty member for discussions of the previous week's Wall Street Journal (WSJ) articles, stressing the use and application of the microeconomic tools being learned in Economics 101. In the first few weeks, the workshop will study how to read the WSJ and will "play" some market "games." Once supply and demand has been studied in Economics 101, much of the WSJ becomes discussable. Workshop attendance is mandatory, and each student will be required to subscribe to the WSJ for the term. During the first few minutes of the seminar, the articles for the subsequent week's seminar will be selected and one or two students appointed to open the discussion of each article on the week's agenda (and turn in to the professor a neat copy of their briefing notes). The remainder of each seminar will be spent talking about the articles that were selected the previous week. Evaluation of students will be entirely on the basis of their briefing notes and attendance. Honors credit for Econ. 101 can be achieved in this course. Cost:1 WL:4 (Porter)

195. Seminar in Introductory Economics. (3). (SS).
Section 001 The United States in an Asia-Pacific-Centered Global Economy.
In the past four decades the locus of international trade and economic growth has shifted from the North Atlantic to the Pacific Basin. This seminar will address the causes and consequences of this shift and its significance for the future of the American economy. Particular attention will be paid to the role Japan has played as a catalyst for this historic change. (Saxonhouse)

B. Economic Theory and Statistics

401. Intermediate Microeconomic Theory. Econ. 101 and 102, and Math. 115. (4). (SS). (QR/1).

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 in economics 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. WL:1 (Morgan)

402. Intermediate Macroeconomic Theory. Econ. 101 and 102, and Math. 115. (3). (SS). (QR/1).

This course in macroeconomics deals with the determination of broad economic aggregates such as national income, employment, the price level, and the balance of payments in both the short run and the long run. 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. Economics 402 is a prerequisite for many other courses offered in Economics. Concentrators in economics 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. Cost:3 WL:3

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

To what extent does the market mechanism do a good job of allocating society's scarce resources? That is the fundamental issue of microeconomic theory. Economics 401 provided all the tools necessary to investigate this core question but time constraints prevented a thorough exploration. Economics 403 focuses on this big-picture question for those with a thorough command of their 401 tools. The course will also consider resource allocation problems over time, under uncertainty, and in the presence of informational constraints.

404. Statistics for Economists. Econ. 101 and 102 and Math. 115. No credit granted to those who have completed or are enrolled in Econ. 405 or Stat. 311, 402, or 412. (4). (Excl). (BS). (QR/1).

This course provides an introduction to the background in descriptive statistics, probability theory, statistical inference, and regression theory needed to enable the large body of empirical work that is now undertaken in economics to be understood and appreciated. 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. Cost:1

405/Stat. 405. Introduction to Statistics. Math. 116 or 118. Juniors and seniors may elect this course concurrently with Econ. 101 or 102. No credit granted to those who have completed or are enrolled in Stat. 311 or 412. Students with credit for Econ. 404 can only elect Econ. 405 for 2 credits and must have permission of instructor. (4). (MSA). (BS). (QR/1).

This course is designed for economics concentrators but the discussion is sufficiently general to serve noneconomics concentrators 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 Economics 406 or a similar course in the Statistics department to learn some applications and to 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. Evaluation of students in the course is based on examinations and homework assignments. There are three hours of lectures and one hour of discussion per week. Cost:3 WL:3 (Sakata)

409. Game Theory. Math. 217, or permission of instructor. (3). (Excl). (BS).

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. (If in doubt about your mathematical background, consult Prof. Stacchetti.) A final examination will count 50%. The remaining 50% will based on weekly homework assignments. Cost:2 WL:4 (Stacchetti)

C. Monetary and Financial Economics

310. Money and Banking. Econ. 101 and 102. (3). (SS).

This course studies the role of money, banking, and finance in the economy. At the macroeconomic level, we will study how monetary policy influences interest rates, prices, and overall economic activity. At the microeconomic level, the course will introduce topics in portfolio theory, risk management, and banking regulation. The nature of banks and problems of their supervision and control are linked to the recent banking crisis in the United States. We will also examine in detail how the Federal Reserve operates monetary policy, and the problems it faces in pursuing objectives such as economic growth, low inflation, and the containment of financial crises.

411. Monetary and Financial Theory. Econ. 402, and 404 or 405. (3). (Excl).

Economics 411 focuses on modern financial markets and the role of monetary and fiscal policy in influencing asset prices and the economy. Monetary and financial economics are developed at a formal level. Topics covered can include financial institutions and markets, interest rate determination, portfolio theory, capital markets, the regulation of financial institutions, the money supply process, money demand, monetary policy, national saving and the national debt. Evaluation will be based on homework assignments, two midterms, and the final exam. Method of instruction is lecture and discussion. The required prerequisite is Econ. 402, Intermediate Macroeconomics. Additional recommended prerequisite is Econ. 401, Intermediate Microeconomics. WL:1

D. Labor Economics

421. Labor Economics I. Econ. 401. (3). (Excl).

This course deals with the economics of labor supply and demand, wage and employment determination, investment in education and training, forms of compensation, and unemployment. The course develops microeconomic models of the labor market, presents relevant empirical evidence, and discusses applications to policy issues. Cost:2 WL:1 (Stinebrickner)

E. Industrial Organization and Public Control

330. American Industries. Econ. 101 and 102. (3). (SS).

The essential features of large-scale business enterprise in the United States today. Considerable attention is devoted to particular industries, including petroleum, beer, prescription drugs, air transport, and telephonic communication. Emphasis is placed on market structure and government policy as determinants of business behavior and performance. Students should be prepared to participate frequently in class discussions. WL:1 (Adams)

431. Industrial Organization and Performance. Econ. 401. (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 oligopoly theory, differentiated products, entry deterrence, collusion, advertising, research and development, price discrimination and strategic rivalry using game theory. There will be a midterm and a final exam. Cost:3 WL:4

432. Government Regulation of Industry. Econ. 401. (3). (Excl).

This course describes and analyzes the efforts of governments to control the market power of business enterprises. Topics include dominant position, oligopolistic cooperation, vertical restraint, and merger. Emphasis is placed in American policies, especially antitrust law and regulation by administrative commission. Econ. 431 is not required, but knowledge of certain material it covers will be presumed. Students should be prepared to participate frequently in class discussions. Cost:2 WL:1

438/Health Management and Policy 661 (Public Health). Economics of Health Services. Econ. 401 or HMP 660, or permission of instructor. (3). (Excl).

This course will introduce students to the fundamental concepts of the field of health economics. The basic framework of economics will be used to analyze the behavior of hospitals, physicians, insurers, and health care consumers. The tools of economics will be applied to managerial issues such as make-or-buy decisions or pricing decisions. Additionally these economic tools will be used to analyze how various parties might respond to changes in the health care system. By the end of the course students should be able to assess the potential impact of hypothetical changes in the health care system on costs and access as well as on the well-being of hospitals, physicians, and insurers. Lecture format. Two exams. Cost:2 WL:4 (Chernew)

F. International Economics

340. International Economics. Econ. 101 and 102. (3). (SS).

The course provides a general overview of international economics. Topics covered include: the reasons for international trade; trade policies such as tariffs, quotas, and voluntary export restraints; the effects of international trade on the economy, including the distribution of income; determination of exchange rates; the role of the international economy in influencing national income, unemployment, and inflation; and international constraints on macroeconomic policy.

441. International Trade Theory. Econ. 401 or the equivalent. (3). (Excl).

This course deals with the theory of international trade. It explores the important theories that explain what countries trade and why they gain from trade. These theories include the theory of comparative advantage and the factor-proportions theory of trade, as well as more recent theoretical developments. The course also deals with several other related topics, such as empirical tests and applications of trade theory, the theory of trade policy, preferential trading arrangements, international factor movements, and trade and economic development. WL:1 Cost:1-2 (Levinsohn)

442. International Finance. Econ. 402 or the equivalent. (3). (Excl).

This course analyzes the macroeconomic and financial interactions between countries. Theories of the balance of payments, the exchange rate, and the international component of income determination are developed. Examples of fixed and flexible exchange-rate regimes are covered, including the gold standard, Bretton Woods, and the EMS. There are graded homeworks, one midterm, and a final exam. Cost:3 WL:1

G. Comparative Economic Systems and National Economies

453. The European Economy. Econ. 401. (3). (Excl).

The structure, function, and performance of the European economy since World War II. Emphasis is placed on description and analysis of European economic integration. Topics include the origins and institutions of the European Community, creation of the customs union, unification of the internal market, implementation of common policies for agriculture and competition, prospects for monetary union, and progress toward social Europe. Students should be prepared to participate frequently in class discussions. WL:1 (Adams)

454. Economics of Japan. Econ. 101 and 102. (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. Cost:4 WL:1 (Saxonhouse)

H. Economic Development

461. The Economics of Development I. Econ. 401. No credit granted to those who have completed or are enrolled in 360. (3). (Excl).

If the economy is globalized, what does development mean? This course explores the economic issues related to development in a globalized economy. What is of economic relevance to developing and emerging nations? This course is structured as alternating lectures and discussion groups set up to explore such topics as emerging export economies, NAFTA and North America, population and economic issues, poverty and income inequality, the changing role of international migration, gender issues in development, micro-lending and exploratory policies, and restructuring and the World Bank. (Kossoudji)

I. Environmental Economics

471/NR&E 571. Environmental Economics. Econ. 401 or NR&E 570 or equivalent. (3). (Excl).

Economics 471 is a broad introduction to market failure, with theoretical, empirical, institutional, and historical perspectives on twentieth-century environmental problems. This course is intended primarily for upper-division undergraduates in the economics concentration and for graduate students from outside economics (but note carefully the prerequisite a solid intermediate microeconomic theory course is essential). In recent years, grades have run around 40% A and about 15% D or E (with these latter being caused largely by discomfort with calculus or difficulty with micro theory). The format for most classes is lecture-with-interruption, with time allocated for questions and discussions. The course deals with: (1) the economic theory of externalities and public goods (and "public bads"); (2) current U.S. environmental policy, emphasizing air and water pollution and waste problems generation, collection, recycling, and disposal; and (3) an in-depth examination of Superfund. There will be a few problem sets, several short quizzes, and paper writing OR a final exam. Those who choose the paper-route must find their own way two or three times to a nearby Superfund site and to its document repository (up to 50 miles or so away). Cost:2 WL:1 (Porter)

J. Public Finance

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

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, and cost-benefit analysis. 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. WL:1

K. Economic History

493/Hist. 493. European Economic History. Econ. 101 and 102. (3). (Excl).

This course covers European Economic History from the Middle Ages to the twentieth century. The course focuses on the causes of economic development in Europe, and the economic forces shaping social institutions in various periods. The first third examines pre-industrial Europe, the next third looks at the Industrial Revolution in Britain and its aftermath, and the final third considers the character and problems of European economies since World War I. Cost:2 WL:1

L. Other Topics in Economics

395. Topics in Economics and Economic Policy. Econ. 101 and 102. (1-3). (Excl). May be repeated for a total of 6 credits.
Section 001 Economics of the Automobile. (3 credits).
The course is divided into three parts, each directed by a different lecturer: (1) the history and structure of the U.S. auto industry, recent changes in its technology and international competitiveness, and U.S. international trade policy, particularly voluntary export quotas, anti-dumping laws, and NAFTA; (2) the impact of the auto on the urban, regional, and national economies of the United States, stressing urban decline, suburban growth, highway depreciation, and traffic congestion; (3) the external effects of the auto - energy consumption, air pollution, and highway safety, looking at the effects on safety of equipment and driver behavior, of minimum driving and drinking ages, and of automobile insurance. The course will stress economic analysis and its policy implications. Students must acquire two or three paperbacks and a course pack. Grades will be based on six quizzes and a short paper. Cost: 2 WL:1 (Levinsohn, Courant, Porter)

Section 002 Seminar in Controversial Economic Policy Issues. (3 credits). This seminar will address a series of economic policy issues which have given rise to sharp debate among economists and policy-makers. Among the issues we will confront are: minimum wage legislation; trade restrictions; environmental protection; privatization of social services; balancing the federal budget; and employee ownership. Students will be expected to defend their positions on these issues with cogent argument, economic analysis, and relevant empirical information. Readings will be selected from a variety of sources and compiled in a set of course packs. Requirements include coming to each class prepared to discuss and debate the issue under consideration; grading will be based on class participation, several in-class quizzes, and a series of short papers. (Weisskopf)

407. Marxist Economics. Econ. 101 and 102. (3). (Excl).

This course provides a critical introduction to Marxian economic analyses of capitalist society in general, of contemporary U.S. capitalism in particular, and of historical and potential alternative economic systems. The first part of the course examines "classical" Marxian theory, based on readings of Marx and Engels as well as recent interpreters. The second part of the course focuses on contemporary political economy examined within a variety of broadly Marxian frameworks. Substantial class discussion is devoted to application of economic theory to social practice. A very broad range of topics is open for the course term paper. (Thompson)

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

This course analyzes legal issues from an economic perspective. It covers topics in a variety of legal areas, including torts, contracts, property law, and legal procedure and dispute resolution. 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. It will examine how the high costs of litigation influence the outcomes of legal disputes and also will analyze various methods of resolving disputes outside of the legal system and their effects. A "truth in advertising" proviso: students intending to go to law school should be cautioned that this course will not help in getting admitted any more than any other economics course. There will be midterm and final exams, and several problem sets. Readings include Polinsky's Introduction to Law and Economics. (White)

M. Honors Program, Seminars, and Independent Research

495. Seminar in Economics. Econ. 401, 402, and 404 or 405; and permission of instructor. (3). (Excl). May be elected for a total of 6 credits.

Admission information for all 495 seminars: Closed at CRISP. Applications will be available at the Undergraduate Economics Office, 158 Lorch Hall. Completed application forms should be returned by Friday, March 28. Admission will be the decision of the instructor and will be posted outside 158 Lorch by Friday, April 4. Contact the Undergraduate Economics Office for further information for Sections 001 and 002.

Section 001 Seminar in Microeconomics. This seminar illustrates how elementary microeconomic tools can be used to illuminate observed real-world phenomena and to evaluate alternative policy interventions. Three-person teams investigate in depth a single local, national, or international topic. The list of topics for the current year is presented at the first meeting. In addition to mainstream economics topics, students have crossed disciplinary boundaries modeling biological problems using the tools of microeconomics. Three recent papers have been published in journals or working paper series, and one was translated into Spanish and used to brief the President of Argentina's Central Bank. Emphasis will be on the accurate understanding of real-world institutional details and the art of isolating salient aspects of problems in a formal but tractable model. Papers and oral presentations will be required. Economics 401 is a prerequisite. Only students with a strong performance in 401 are admitted. (Salant)

498. Honors Independent Research. Open only to students admitted to Honors concentration in economics. (1-4). (Excl). (INDEPENDENT). May be repeated for a total of 8 credits.

This course is for undergraduates writing senior Honors theses. 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 thesis advisor with whom the student has arranged to work.

499. Independent Research. Written permission of staff member supervising research, and permission of Economics concentration advisor. (1-4). (Excl). (INDEPENDENT). May be elected for a total of 8 credits. No more than 4 credits may be used in concentration program.

Student and instructor agree on a substantial piece of work involving reading or research. Evaluation is based on the written work, either papers or examinations.

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