Fall Course Guide

Courses in Economics (Division 358)

Fall Term, 1998 (September 8-December 21, 1998)

Take me to the Fall Time Schedule

Override Procedures for Economics courses

Override Procedures for Economics 101 and 102:

Please contact Jeannie Tramontin for details in the Undergraduate Economics Office (158 Lorch Hall, 763-9242). Office hours for Fall Term will be Monday-Friday 8:00-12:30 & 1-4:30. Jeannie Tramontin will be available to answer questions about the Economics concentration requirements, college or department policies and procedures, and general university information. Students can schedule advising appointments by calling or stopping by the office.

Override procedures for 300- and 400-level courses will be handled by the faculty member in charge.

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; price controls; competition and efficiency; the differences between competition and monopoly; labor markets; 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, Bogart, Malone)

Section 300 only. 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; environmental issues; and government taxation and expenditure. 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: two hour tests (total of 40%); four UNANNOUNCED quizzes given during section meetings (10%); weekly homework assignments that will be collected, graded, and discussed in the section meetings (10%); 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 (Porter)
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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 graduate student instructor. The section meetings are limited to 35 students. Cost:2 WL:Contact Undergraduate Office, Dept. of Economics, 158 Lorch Hall (Section 100: Johnson; Section 200: Hurst)
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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 twice a week. WL:1 (Salant, Gerson)
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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), written exercises, 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.
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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. 265, 311, 402, 405, 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 (Howrey)
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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. 265, 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 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 course emphasizes 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 gain experience with applications and computational methods. 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 (Kilian)
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C. Monetary and Financial Economics

412. Topics in Macroeconomics. Econ. 402. (3). (Excl).
Economics 412 is an advanced undergraduate course in applied monetary theory and macroeconomics. Our focus will be on developing and using macroeconomic models for policy analysis and forecasting. We will first review and extend models introduced in intermediate macroeconomics (Econ 402) and then apply these models to issues such as inflation, economic growth, business cycles, and real wage growth. The second part of the course will focus on econometric modeling of the macro economy, including model specification, data issues, model estimation and evaluation, policy simulation experiments, and preparing, generating, and adjusting forecasts. Students will participate in small group projects where they will have computer experience with modeling and forecasting using the Michigan Quarterly Econometric Model. In addition to the official prerequisite (Econ 402), students should take intermediate microeconomics (Econ 401) and statistics (Econ 404 or 405) before taking this course.Cost:2 WL:1 (Barsky)
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418. Business Cycles. Econ. 402. (3). (Excl).
This course will look at business cycle theory in a way that combines macroeconomics and microeconomics. It will emphasize economic dynamics, particularly the reactions of output, consumption, investment, the real wage, the real interest rate, and inflation to fiscal, monetary, and technological shocks. Prerequisites: Economics 401 and 402. Calculus will be used extensively for maximization. (Kimball)
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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)
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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 and the effects of international trade; trade policies such as tariffs, quotas, and voluntary export restraints; trade arrangements and institutions such as the NAFTA and WTO; determination of exchange rates; the role of the international economy in influencing national income, unemployment, and inflation; and international constraints on macroeconomic policy. Emphasis is on concepts, ideas and institutions, rather than on rigorous analysis. Course grade is based on a midterm exam, a final exam, several homework assignments requiring access to the World Wide Web, and an optional 5-10 page paper. Students are also expected to stay abreast of international economic news by reading the New York Times or the Wall Street Journal, and class includes weekly class discussions of the current news. Cost:2 WL:1 (Deardorff)
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441. International Trade Theory. Econ. 401. (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. A special emphasis is placed on current policy issues in international trade. WL:1 Cost:1-2 (Levinsohn)
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442. International Finance. Econ. 402. (3). (Excl).
This course analyzes the macroeconomic and financial linkages between countries. The structure of the foreign exchange market, offshore markets, international bond and equity markets is reviewed and analyzed. The course also covers theories of exchange rate determination and the problems and policy implications of alternative exchange rate regimes. Course evaluations are based on graded problem sets, two midterms, and a final exam. Cost:2 WL:2 (Tesar)
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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)
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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 history and 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:3 WL:1 (Saxonhouse)
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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)
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I. Environmental Economics

471/NR&E 571. Environmental Economics. Econ. 401 or NR&E 570. (3). (Excl).
Economics 471 is a broad introduction to market failure, with theoretical, empirical, institutional, and historical perspectives on current U.S. 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 comfort with calculus and a recent, challenging intermediate microeconomic theory course are essential). 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"); and (2) the economic analysis of current U.S. environmental policy, emphasizing air and water pollution and waste problems - generation, collection, recycling, and disposal (emphasizing municipal solid waste, low-level radioactive waste, and Superfund). There will be regular unannounced short quizzes and a cumulative final exam. Cost:2 WL:1 (Porter)
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K. Economic History

494/Hist. 494. Topics in Economic History. Econ. 101 and 102. (3). (Excl).
Section 001 East Asian Economic History.
This course surveys the development of East Asian economies (China, Japan, Korea, and Taiwan) over the long term. It aims at providing a historical and comparative perspective on the changes in institutions, technology, and economic structure in the region. Some of the main topics to be examined are: agriculture in the traditional economy; population and labor markets in East Asia; the industrialization of Japan; imperialism and East Asian economies; and the industrial growth and the catching-up of Taiwan and Korea. The course will follow a discussion format and the grade will be based on two one-hour tests, the final exam, and class discussion. (Gill)
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496. History of Economic Thought. Econ. 101 and 102. (3). (Excl).
This course provides an overview of the development of economics from the origins of modern capitalism to the present. The aim of the course is to deepen understanding of contemporary economic questions by situating them in the context of how such questions have arisen and been debated in the history of economic thought. Topics include: (1) Classical political economy from Adam Smith through Karl Marx; (2) Neoclassical economics from Jevons, Menger, and Walras through Marshall and his followers; (3) Keynesian economics and the neoclassical synthesis; (4) more recent New Classical, New Keynesian, Post Keynesian, and neomarxist developments. Economic theory will be situated in the broader historical contexts in which they developed. Attention will be focused on the scientific status of economic theories as well as their relation to policy and normative considerations. Cost:2 WL:4 (Thompson)
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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 six credits.
Section 001 Economics of Crime. (3 credits).
Study of crime and criminal behavior as rational economic choices; costs of crime to the community; optimal resource allocation within the criminal justice system; monopolized markets and organized crime. Prerequisite: Microeconomic Principles. (Malone)

Section 002 Seminar on 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: environmental protection; labor rights and international trade; reform of the U.S. social security system; market-based choice in education; and affirmative action. 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 participation in classroom and computer conference discussions, a series of in-class quizzes, and several short papers. Cost:2 WL:1 (Weisskopf)

Section 003 The Korean Economy. (3 credits). This course examines the transformation of the Korean economy from its colonial past to the present time. Special emphasis is placed on the role of government relative to that of market in the growth process. Topics include: the structure of the colonial economy; the developmental role of the foreign sector and aid; the role of government; the growth of big business (chaebol); employment and the labor market; and the debt crisis. The course will follow a discussion format and the grade will be based on two one-hour tests, the final exam, and class discussion. (Gill)
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398. Strategy. Econ. 101. (3). (SS).
Section 001 Strategy and Equity.
This course is an introduction to the science of strategic thinking and the art of equity. Basics of non-cooperative as well as cooperative game theory will be covered via simple cases in business, international crises, mass elections, legislative voting, cost sharing, college admissions, housing lotteries, kidney allocation, etc. Cost:2 WL:3 (Sönmez)
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490. Current Topics in Economics. Econ. 401, 402, 404 or 405. (3). (Excl).
Section 001 Collective Action.
When will groups of people with common interests successfully act collectively to achieve their aims? Collective action is prone to a "free-rider" problem: individuals may hope to achieve the benefits from collective action by others without participating in it themselves. This course probes the various means by which the free-rider problem is overcome and studies examples such as labor unions, collusion by firms, political parties, lobbying, revolutions, management of common property resources, and the monitoring of public officials by citizens. (E. Somanathan)
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555/Public Policy 555. Microeconomics. Permission of instructor. (4). (Excl).
See Public Policy 555. (Levinsohn)
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573/Public Policy 573. Benefit-Cost Analysis. Econ. 555. (4). (Excl).
See Public Policy 573. (Courant)
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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 repeated for a total of six credits.
Admission information for all 495 seminars: Closed at CRISP. Applications will be available at the Undergraduate Economics Office, 158 Lorch Hall. Admission will be the decision of the instructor. Contact the Undergraduate Economics Office for further information.

Section 001 Social Regulation. This seminar studies a broad range of topics in social regulation, defined as government intervention to correct inequities or to control other social problems caused by economic growth and technological change. Examples include environmental, health, and safety regulation, affirmative action, and protection of freedom of speech. The seminar begins with classroom review of essential concepts and tools, after which participants are expected to pursue (in small groups) a significant research topic agreed to by the instructor. Emphasis is on the use of formal microeconomic models to analyze real-world problems and to evaluate policy interventions. Papers and oral presentations are required. Economics 401 is a prerequisite. (Van't Veld)
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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 eight 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.
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499. Independent Research. Written permission of staff member supervising research, and permission of the economics concentration advisor. (1-4). (Excl). No more than four credits may be used in an economics concentration program. (INDEPENDENT). May be repeated for a total of eight credits.
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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