Course description
Microeconomics studies in details how separate economics agents — individuals (consumers) and firms (suppliers) — function and communicate, and what results out of this communication. During the course the students will learn how to model economic agents’ behaviour — individuals maximize their utility accounting for their budget constraints and demand various goods and services, and firms maximize profits accounting for the resource constraints and supply goods and services. The students will be able to describe relations of consumers and suppliers within one market (partial economic equilibrium) for any market structure (from perfect competition to monopoly and oligopoly). The students will learn how to describe relations between different markets within a model of general economic equilibrium and the role of the invisible hand of the market in this process. After the course the students will be able to explain why OPEC can enforce its interests onto the market, what is the economic solution to the noisy neighbours, and why quarantine during an epidemic should be a government-led option.
Topics
- Demand and supply. Partial equilibrium.
- Technology. Profit maximization
- Preference relations. Utility theory
- Consumer choice
- Exchange economy. General equilibrium
- Monopoly. Oligopoly
- Externalities and public goods
- Social choice and welfare economics
- Expected utility and economic uncertainty analysis
- Asymmetric information and adverse selection
Literature
- Jehle G., Reny P. (2011) Advanced Microeconomic Theory, 3rd ed. Pearson.
- Mas-Colell A., Whinston M., Green J. (1995). Microeconomic Theory.
- Nicholson W., Snyder C. (2017) Microeconomic Theory Basic Principles and Extensions, 12th ed. Cengage Learning.
- Varian H. (1992). Microeconomic Analysis, 3rd ed. W. W. Norton & Company.
- Varian H. (2014). Intermediate Microeconomics: A Modern Approach, 9th edition. W. W. Norton & Company.