A. Introductory Courses

201. Principles of Economics I. No credit granted to those who have completed or are enrolled in 400. I, II, IIIa, and IIIb. (4). (SS).

Economics 201 concentrates on the microeconomics of the modern economy: how prices and quantities of goods and services are determined under competitive conditions as well as in other types of markets; the determination of wage rates and the distribution of income; the public sector; 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 and a half hours of discussion per week (Section 101-113, 201-212, 301-312) taught by a teaching assistant. Grades are based largely on course-wide hour tests and the final exam, but there will be homework and/or 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. Cost:2 WL:None. For information about overrides, call the Undergraduate Office at 763-9242. (Section 100: Porter; Section 200: Gerson; Section 300: Stafford)

202. Principles of Economics II. Econ. 201. No credit granted to those who have completed or are enrolled in 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 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: Weisskopf; Section 200: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 Math 115 or equivalent, and Economics 201 (or permission of the instructor). 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. Cost:3 (Bergstrom)

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

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. 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. WL:3 Cost:3 (Basu)

404. Statistics for Economists. Econ. 201 and 202 and Math. 115. No credit granted to those who have completed or are enrolled in 405 or Stat. 311, 402, or 412. (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. Cost:2-3 WL:1 (Howrey)

SECTION 004. 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 (Genius)

405/Statistics 405. Introduction to Statistics. Math. 116 or 118, 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 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). (Excl).

See Statistics 405. (Woodroofe)

406. Introduction to Econometrics. Econ. 405 or Statistics 426. (4). (Excl).

Economics 406 is an introduction to the statistical analysis of economic relationships. Most of the course focuses on the theory and application of regression analysis. Students are expected to be familiar with elementary calculus. The course work includes examinations and assignments including computer exercises involving economic data. (Genius)

C. Monetary and Financial Economics

411. Monetary and Financial Theory. Econ. 402, and 404 or 405. No credit granted to those who have completed or are enrolled in 310. (3). (Excl).

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. Topics covered include financial institutions and markets, interest rate determination, portfolio theory, capital markets, the regulation of of financial institutions, the money supply process, money demand, and monetary policy. 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 prerequisites are Statistics (Econ 404 or 405) and Econ 401, Intermediate Microeconomics. WL:1 (Kimball)

412. Topics in Macroeconomics. Econ. 402. No credit granted to those who have completed or are enrolled in 310. (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), student should take intermediate microeconomics (Econ 401) and statistics (Econ 404 or 405) before taking this course. Cost:2 WL:1 (Wolfe)

435. Financial Economics. Econ. 401 and 405, or equivalent. (3). (Excl).

This class introduces the economics of financial markets in the U.S. The theory of financial investment decisions is developed, with emphasis on investing under uncertainty. Various models of equilibrium prices for financial assets are derived. Some institutional background on the workings of various segments of financial markets is also presented. Applications of the theories to policy problems are presented throughout the course. For example, we examine the economics of the Michigan Education Trust (prepaid tuition financing) plan, the effect that airplane crashes have on airline stock prices and insurance premia, and the U.S. government's multibillion dollar loan guarantee for the Chrysler Corporation. (Mackie-Mason)

D. Labor Economics

422. The Structure of Labor Markets. Econ. 401. No credit granted to those who have completed or are enrolled in 320 or 326. (3). (Excl).

Economics 401 is a prerequisite. Economics 421 is not a prerequisite. This course is the second term of a two-term offering in labor economics. The previous term covered the supply of and demand for labor, wage determination, investment in education and training, and some coverage of theories of unemployment. In this term we will offer a very brief review of supply and demand, and turn to labor demand, technology and trade, the structure of compensation, unions and collective bargaining, discrimination in the labor market, government employment policy, government policies which affect the labor market, and unemployment. WL:1 (Stafford)

E. Industrial Organization and Public Control

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 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 (Roth)

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

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).

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. This year's course will also devote special attention to the proposed North American Free Trade Area. Emphasis is on concepts, ideas and institutions, rather than on rigorous analysis. Course grade is based on a final exam, one midterm exam, a few short unannounced quizzes, 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 will include weekly class discussions of the current news. WL:1 (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).

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. No credit granted to those who have completed or are enrolled in 340. (3). (Excl).

This course analyzes the macroeconomic and financial interactions between countries. The international component of income and output determination theories of the balance of payments, exchange rate determination, international asset markets and banking, and developing country issues are covered. There are graded homeworks, one midterm and a final exam. WL:1; Cost:5 (Bernasek)

G. Comparative Economic Systems and National Economies

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. Cost:4 WL:1 (Saxonhouse)

457. Problems of Transition in Eastern European Economies. Econ. 201 and 202. (3). (Excl).

This course is an introduction to current economic issues of the post-socialist transition in formerly socialist countries. Topics of study will include strategies of transition, macroeconomic stabilization, international trade liberalization, privatization of formerly state-owned enterprises and the restructuring of social security and social welfare systems. With regard to each topic, first the economic reality will be explained; then, the corresponding policy debates will be discussed. Throughout the course, political factors of the transition will be emphasized. (Li)

H. Economic Development

462. The Economics of Development II. Econ. 401 and Econ. 360 or 461. (3). (Excl).

This course is the second part of a two-course sequence on the economic development of third world countries. Economics 462 examines in some detail selected topics on development. It focuses on policy issues by studying analytical approaches to policy determination and how policy change might affect different groups in the economy. On each of the topics the course will look at the experiences of individual countries. Three broad topics are slated for examination: (1) agricultural sector policies production, prices and marketing; (2) trade regimes and exchange rate policies; and (3) macroeconomic policy reform and structural adjustment. The countries are likely to be Ghana, Malaysia, Mexico and Morocco. The overall course grade will be based on a 10-page paper on a topic of the student's own choosing (40%), four brief quizzes (20%) and a final exam (40%). Students will be expected to purchase a course pack of readings and the World Development Report 1992. A few additional readings and references will be on reserve. The method of instruction will primarily be lecture but there will be ample opportunity for discussion. Cost:2 WL:1 (Steedman)

466. Economics of Population. Econ. 401. (3). (Excl).

An introduction to economic analysis of demographic behavior. The course uses an economic perspective to analyze the dramatic changes in fertility, morality, and marriage in recent decades in both industrialized and developing countries. Data on demographic economic trends for a wide variety of countries are used throughout the course. The course demonstrates recent innovations in the application of microeconomic theory to demographic behavior, including fertility, marriage, and migration. Students are also introduced to basic techniques of demographic measurement and mathematical demography. Topics include the economic consequences of the baby boom, the effects of an older age structure on the social security system, and the relationship between population growth and natural resources. Students write a short paper providing an economic-demographic analysis of their home community or other geographic area. Other coursework includes problem sets and the midterm and final examinations. WL:1 (Rao)

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, 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.WL:1 (Ohlsson)

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

Economics 482 studies the allocated role of government as well as the interactions among politics, economics and ethics. Topics covered are the main types of taxes, tax incidence, optimal taxation and tax reform. Emphasis will be placed on theoretical as well as political issues. The class format will combine lecture and discussion. WL:1 (Ohlsson)

K. Economic History

491/Hist. 491. The History of the American Economy. Econ. 201 and 202. (3). (Excl).

This course examines the economic history of the United States from colonial settlement to World War II. We will focus on the sources of the country's economic growth, trends in income distribution, regional integration, and changes in political-economic institutions. We will pay particular attention to the role of government policy in influencing economic outcomes. Students will be evaluated on the basis of weekly essays and a group project on the economic history of Michigan. The primary text for the course is The History of the American Economy, 6th edition, by Gary Walton and Hugh Rockoff. Cost:2 WL:1 (Levenstein)

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. To apply for admission into the 495 seminar, students must provide both an unofficial transcript and a completed application no later than October 28. The transcript should be requested from the General Information Window in the LS&A lobby (open 8-4:15 Mon-Fri) and should be sent to the economics undergraduate office, room 158 Lorch Hall. The fee is $1.00 and the process takes several days. An application form is available from the economics undergraduate office, 158 Lorch Hall, and should be returned to 238 Lorch Hall. Admission will be the decision of the instructor and will be posted at Room 158 Lorch Hall by November 4.

Section 001. Trade Policy, Competitiveness and U.S. Japanese Economic Relations. This course will examine issues raised by the increasing integration of the global economy. Particular emphasis will be placed on the structure and operation of the Japanese economy and its implications for present and future U.S.-Japanese economic relations. Special topics covered will include the Uruguay Round, Regional Free Trade Areas, competition in high technology, industrial policy, liberalization of financial markets and stabilization policy. (Saxonhouse)

Section 002. Benefit-Cost Analysis of Environmental Policies or Projects. During the first half of the course, each student will select a current, real, local environmental problem, project, or policy while, as a group we work through a serious (tough theory but not much math) textbook in benefit-cost analysis (with some problem sets and maybe even quizzes). During the second half of the course, students will pursue their topic, reporting regularly to the seminar on their progress and the problems they are encountering. By "reporting regularly" is meant that an outline, a preliminary report, and a final paper will be submitted. ECB credit may be earned. (E-Mail GD46 for further information or an appointment.) (Porter)

Section 003 International Macroeconomic and Financial Policies. This seminar will deal with a variety of important international financial and macroeconomic issues that confront the world's major industrialized, developing, and East European economies. We will begin with an overview of recent developments in the world economy and then briefly consider international financial experiences in historical perspective. This will be followed by sessions dealing with the structure and analysis of the behavior of the foreign exchange and international capital markets under the current conditions of floating exchange rates. We will then devote several sessions to issues of international macroeconomic performance and policies in the major industrialized countries and sessions to international macroeconomic management and debt problems in the major developing countries and Eastern Europe. Papers and oral presentation will be required. As a prerequisite, completion of Economics 442 is strongly recommended but not required. (Stern)

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