Microeconomic Theory II
ECON6031
Syllabus
Dr. Jan Keil∗
University of the West Indies
Department of Economics
Semester II 2013/14
Mon 2-3pm, Tue 9-11am, GLT 1
Sequence Description: Microeconomic Theory I & II
This course introduces students to graduate level Microeconomic theory. It is
the second part of a sequence of two graduate classes, Microeconomic Theory I
and II (the former having been also offered by Dr. Keil). Microeconomic Theory
I dealt with partial and general equilibrium models under standard assumptions
of the theoretical approaches (i.e. perfect competition and perfectly functioning
markets in standard theory).
Course Description: Microeconomic Theory II
Microeconomic Theory II is concerned with the deviations from the perfectionist
Neoclassical model. It thus deals with market power (oligopolistic competition
and monopolies), external effects, public goods, imperfect and asymmetric information) and extensions of Microeconomics through e.g. game theory. In
addition to standard Neoclassical models, dynamic theories of competition and
institutionalist approaches will be mentioned.
∗ Email: [email protected]. Office address: Room E 208 McIntyre Building. Office
Phone: (876)970-6012, Extension 3012. Office hours: Thu 2-4pm, Fri 1-3pm.
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Dr. Jan Keil
Syllabus
Microeconomic Theory II
ECON6031
Page 2
Semester II 2013/14
Learning Objectives
The course aims at developing the students’ competence to:
• Comprehend advanced standard Microeconomic theory and recent developments and discussions in the field
• Distinguish between different models and identify the potentials and the
limits of different approaches
• Analyze, evaluate and solve real world examples and problems with Microeconomic tools and techniques
• Evaluate, expose and reflect on practical and theoretical Microeconomic
matters in a clear, cogent, creative and critical way
Required Work & Evaluation
In order to successfully complete this course, students have to attend the sessions, read the required material, participate in class, finish and present solutions
to problem sets and pass the final examination.
Problem Set Presentations [20%] Problem sets are assigned on a bi-weekly
basis. Their purpose is to induce students to practice the material presented in
the lecture. Solutions to the problem sets will be presented by students in class
and have to be made available online.
Class Participation [10%] Students have the opportunity to participate in
class and are graded according to the quality of contributions.
Final Exam [70%] The final in-class exam will be written after classes end.
It will cover all of the material covered in the course.
Course Material
Core readings
The main text for the course is
• Varian, Hal R. (1992): Microeconomic Analysis, 3rd Edition; W.W. Norton & Company Inc.; New York, NY.
Students should obtain access to the book.
Additional readings
There will be several individual additional readings that will be provided as the
course proceeds.
Dr. Jan Keil
Syllabus
Microeconomic Theory II
ECON6031
Page 3
Semester II 2013/14
List of Topics & Course Structure
Students must complete the required reading before class. Failure to do so will
have a negative impact on your ability to follow the material and successfully finish the assignments. Make sure you schedule enough time to complete assigned
material, take notes, prepare questions and revise each session.
Section 1
Basics and selected topics
• Uncertainty, time and asset markets
• Economic welfare
• Externalities
– Taxation, property rights
• Public goods
– Market failure & government intervention
Section 2
Deviations from perfect competition
• Monopolies
– Pricing & price discrimination
– Welfare & regulation
• Oligopolies
– Oligopolistic competition models
– Barriers to mobility, concentration, profitability
• Dynamic theories of competition
• Empirical evidence
Section 3
Deviations from complete markets
• Incomplete contracts, imperfect information
• Principal-agent problems, moral hazard
• Transaction costs, institutions, neo-institutional economics