Pomona College
Economics 52
Principles of Microeconomic
James D. Likens
This is a course in the principles of microeconomics. Its purpose is to teach you economic reasoning and to help you develop the ability to deduce the logical consequences of well defined assumptions. In the first part of the course you will learn about a number of formal models intended to describe the behavior of economic agents: These models will help you answer these kinds of questions: How can consumers most effectively spend their incomes, given the prices they face? How does a firm maximize profits? How would a rational person decide how many hours to work? How does a company decide how many units of various inputs to hire? From these formal models you will learn how supply and demand are presumed to interact in the markets for goods & services, and how supply and demand are expected to interact in the markets for resources. Our formal models will also be extended into the policy arena: Does the market make good decisions? When might market outcomes be socially desirable, and when might they be undesirable? What is the best role for government as a provider of goods and services? What is the market impact of the taxes we pay? Can government to improve the functioning of private markets?
In the
second part of the course you will apply and extend these formal models to
the study of real world public policy issues. You will apply the formal
reasoning you learned in the first part of the course to write a paper that
analyzes a policy issue and, working with a classmate on the same issue, present
your findings in debate format to the class. You will also read the
papers of your classmates who have worked on other topics and write a brief
position paper expressing the conclusions you have reached on the policy
issues presented by them.
Text
Paul Krugman and Robin Wells, Microeconomics (New York: Worth Publishers, Third Edition, 2012).
Shop carefully. The text is sold in
one version with Aplia. and in another version
without. Normally it is less expensive to buy the text and Aplia tied
together into a single package.
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Approximate bases for term grade
Online Aplia
assignments: 30%
Four examinations 40%
Your written debate paper and class presentation: 15%
Written policy positions: 15%
Aplia Assignments
These assignments are on the Aplia web site at http://econ.aplia.com
Examinations
Examination 1, Chapters 3-8,
Friday, September 21
Examination 2, Chapters 9-12 and
19, Friday, October 12
Examination 3, Chapters 13-15, Friday,
November 2
Examination 4, Chapters 16-18 and
20, Monday, November 19
Grading Policy
You are expected to take examinations
at their scheduled times and to complete all other assignments on time. Make
your holiday travel plans with the above examination schedule in mind.
Permission for exceptions must be obtained in advance. Grades will be adjusted
for noncompliance with this policy. Class participation and attendance are
expected. Grades will be adjusted significantly
for missing classes and for low involvement.
Part I: Understanding
the Reasoning of Some Formal Models
PART 1 What is Economics?
Intro: The Ordinary Business of Life
1 First Principles
2 Economic Models: Trade-offs and Trade
Appendix: Graphs in Economics
PART 2 Supply
and Demand
3 Supply and Demand
4 Consumer and Producer Surplus
5 Price
Controls and Quotas: Meddling with Markets
6 Elasticity
PART 3
Individuals and Markets
7 Taxes
8 International Trade
PART 4
Economics and Decision Making
9 Making Decisions
PART 5 The
Consumer
10 The Rational Consumer
Appendix: Consumer Preferences and Consumer Choice
PART 6 The
Production Decision
11 Behind the Supply Curve: Inputs and Costs
12 Perfect Competition and the Supply Curve
19 Factor Markets and the Distribution of Income
Appendix:
Indifference Curve Analysis of Labor Supply
PART 7 Market
Structure: Beyond Perfect Competition
13 Monopoly
14 Oligopoly
15 Monopolistic Competition and Product Differentiation
PART 8
Microeconomics and Public Policy
16 Externalities
17 Public Goods and Common Resources
18 The Economics of the Welfare State
PART 9 Factor
Markets and Risk
20 Uncertainty, Risk, and Private Information
Part II: Applying Formal Models to Public Policy Issues
A number
of weeks into the semester each student will be asked to choose a topic from a
list of ideas submitted by the professor and suggested by students. Several
students will be assigned to the same general subject and each student will be
responsible for developing an aspect of the topic for his/her paper and class
presentation.
In addition, you will be responsible for attending the presentations of other students, reading their papers, and coming to your own conclusion (in writing) about the topic.
