Review: S&D
Varian Microeconomics Chapter 1, attached below, discusses Supply and Demand in the market for rental of apartments in a college town. Since this S&D model is fundamental in analysis for micro and macro, we will study it first. There are many complex issues that are discussed here without any explicit mention. Students are deceived into believing that things are very simple, which are in fact very complex. Wrong ideas are passed off as being obvious tautologies.
The basic model discussed in Chapter 1 below should be familiar to all students of economics. Just review the chapter to refresh your memories. We will discuss and critique the S&D Model in class. But first, we will play a game of S&D so that students acquire EXPERIENCE with the setup under discussion. This is one major methodological change that we will introduce in this course -- we will try to relate theories to real world experience that students have. The theory should be something we recognize in our lives.
S1: Review of Varian Supply and Demand, pages 1-8
S2: Syed Kanwar Abbas & Asad Zaman: Some basic implications of S&D, and contradictory empirical experience
S3: Experience with S&D game in classroom setting.
S4: Contrast between Game Outcomes and S&D Theory
S5: Empirical Evidence against the S&D Theory.
S6: Keynes Views on S&D in Labor Market -- some prelminary introduction
L03 of Micro on S&D in Labor Market - Extensive discussion, summary, videos and links (older lecture)