30452 - FOUNDATIONS OF ECONOMICS - MODULE 1 (MICROECONOMICS)
Course taught in English
Go to class group/s: 13
Students learn how to think about the myriad of real-world economic and noneconomic issues through the lens of microeconomic analysis. The elegant and powerful tools of microeconomic theory endow students with an analytical mindset and a strong quantitative preparation, which form the building blocks for understanding the foundations of microeconomic analysis. The course combines mathematical rigor and a 360-degree vision of real-world economic and social phenomena to address fascinating questions about human behavior in economic and noneconomic settings.
- The beauty of microeconomics. How to think like an economist. Models and data. Math review.
- Budget and time constraints
- Preferences and utility
- Constrained optimal consumption choice
- Uncompensated demand curves
- Price and income elasticities
- Compensated demand curves, expenditure function
- Substitution and income effects; Slutsky equation
- Leisure versus labor choice; the labor supply
- Intertemporal choice; the saving and borrowing functions
- Choice under uncertainty; lotteries, expected utility, risk attitudes; insurance
- Game theory and its applications (Nash equilibrium; subgame perfect equilibrium)
- Production and costs, firm's and market supply curves
- Equilibrium in perfectly competitive markets
- Taxes, subsidies, price ceilings and floors, welfare analysis
- Monopoly (with and without price discrimination)
- Oligopoly (Cournot and Bertrand models; cartels)
- General equilibrium analysis; Pareto efficiency; welfare theorems
- Externalities and public goods; free riding problem
- The journey through microeconomics: what did we learn
- Acquire a profound knowledge of the theoretical underpinnings of Microeconomics and its myriad applications to the real world.
- Develop the ability to write an economic model, in particular to understand the choice behavior of individuals, households, workers, firms, and governments through markets and nonmarket interactions.
- Compare the theoretical predictions of models and the empirical evidence on economic outcomes.
- Apply the economic way of thinking to other fields outside economics, including anthropology, biology, demography, history, medicine, political science, and sociology.
- Develop a problem-solving attitude.
- Develop team-building and team-working skills in a multicultural environment.
- Learn to communicate in a clear and concise way.
- Learn to set priorities, meet deadlines, and deliver the expected outcomes.
- Develop the ability to think rigorously, analytically, and creatively at the same time.
- Face-to-face lectures
- Online lectures
- Guest speaker's talks (in class or in distance)
- Exercises (exercises, database, software etc.)
- Individual assignments
- Group assignments
The Microeconomics course is built around these building blocks (aka, pillars):
- Theory Lectures
- Understanding Microeconomics is about learning models and the theoretical framework through a combination of mathematical tools and economic intuition. In the theory lectures we learn together a series of concepts, models, graphs, and calculus-driven analysis that help us analyze myriads of economic and noneconomic issues through the lens of economic analysis.
- Individual Homeworks
- 12 individual homeworks (roughly one per week) are assigned through the Smartworks 5 platform. The platform automatically grades the homeworks and explains the solutions.
- Group Problem Sets
- 4 long problem sets are assigned to groups of 3 or 4 students. Solutions must be typed using LaTex.
- Collective Office Hours
To encourage continuous interaction between instructors and students, through Blackboard or Zoom the instructors will hold weekly meetings in which they answer questions of general interest and offer insights on current events through the eyes of Microeconomics.
|Continuous assessment||Partial exams||General exam|
The material, the workload, the requirements, and the evaluation based on homeworks, problem sets, and exams, are identical for each student, attending and non-attending.
With the purpose of measuring the acquisition of the learning outcomes mentioned above, students' assessment is based on the following criteria and weights:
- 10% of the overall grade: 12 individual homeworks through the SmartWorks 5 platform integrated into Blackboard. Skills tested are: problem solving attitude, setting priorities and meeting deadlines.
- Pass or Fail: 4 group problem sets typed in Latex and uploaded through Blackboard. Skills tested are: team working and multicultural attitude, leadership skills, problem solving attitude, setting priorities and meeting deadlines.
- 30% of the overall grade: Midterm take-home written assignment on the first half of the program.
- 10% of the overall grade: Midterm essay in class on the first half of the program.
- 30% of the overall grade: Final take-home written assignment on the second half of the program.
- 20% of the overall grade: Final written exam in class on the second half of the program.
The written take-home assignments, the midterm essay in class, and the final exam in class are aimed to test the ability of applying theoretical concepts and models to specific economic problems and interpreting mathematical relationships in economic terms (eg., the Slutsky equation and the economic concepts of substitution and income effects in consumption, labor, and intertemporal choices). Also, these evaluation methods test analytical skills and problem-solving attitudes, as well as the ability of thinking critically about economic issues.
Detailed information regarding the duration and format of the homeworks, problem sets, take-home assignments, essay, and exams will be provided during the first two weeks of the course.
Grades are based on the X/30 cum laude scale with the minimum passing grade for the entire course being 18/30. A minimum grade of 10/30 in the midterm take-home assignment must be obtained. If this is not the case, students will take a 5-hour general exam on the entire program (80% of the overall grade) in January or during the summer sessions.
You can find all the relevant information on BlackBoard (syllabus, lecture notes, individual homeworks, group problem sets, past exams, additional helpful material)
- The required textbook is Hal H. Varian. Intermediate Microeconomics with Calculus. International Student Edition. First edition. Norton Company (2020). ISBN 9780393690019, a book that combines a rigorous mathematical treatment of Microeconomics together with many applications and real-world examples.
- The purchase gives access to the SmartWorks 5 platform, which is required for the individual Homeworks.
- The textbook is available at Egea bookstore, or through the publisher website (2 weeks for delivery), or through Amazon. Make sure you purchase the edition listed above with the correct ISBN number.