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Division: The New School for Social Research
Course Number: GECO 6190
Course Format: Lecture
Location: NYC campus
Permission Required: No
This course covers the fundamental aspects of microeconomic theory that are required to read contemporary economics journals and to create new models to explain the behavior of firms, households, and markets, and to evaluate economic policies. Some of the material overlaps with a high level undergraduate intermediate microeconomics course, but will be treated from a more critical and methodological point of view. Students who have had a strong undergraduate intermediate microeconomics course should consult the instructor to decide between this course and Advanced Microeconomic Theory. The first part of the course focuses on modeling households, firms, and markets under the assumption of full information about the commodities being produced and exchanged. This section of the course will review supply and demand models and the theory of consumer surplus, the theory of consumer choice, particularly applied to labor supply, saving, and risk taking, the theory of the cost minimizing and profit maximizing competitive firm, cost functions and industry equilibrium, general equilibrium and market failure due to externalities, monopoly, and government intervention, the theory of the Second Best, oligopoly, monopolistic competition, and basic concepts of game theory. The second part of the course considers the problem of incomplete and asymmetric information in market interactions, including the issues of moral hazard, adverse selection, and signaling. The theoretical concepts will be illustrated by examples of applications to important social and policy problems, including environmental degradation, financial evolution, industrial regulation, market liberalization, and labor market discrimination. The critical evaluation of microeconomic theory as an analytical and policy tool will be a major focus of class discussion.
Course Open to: Majors Only