Microeconomics.

Fall 2025

Teacher Régis Renault

Office Chênes 1, A106

Phone 01 34 25 72 28

E-mail regis.renault@cyu.fr

Texts:

Varian H. Microeconomic analysis. 3rd edition, Norton,

MasColell, A, Whinston, M.D., and J.R. Green. Microeconomic theory. Oxford.

Cahuc, P., Carcillo S. and A. Zilberberg. Labor economics. 2nd edition. MIT Press.

Laffont, J.J. and J. Tirole. A theory of incentives in procurement and regulation. MIT Press.   

Course outline

September 10-September 26: Chapter 1. Wealth, income and consumption choices.  SLIDES

Preferences and consumer choice – Wealth, income and budget constraint – Indirect utility – Roy identity and Slytsky equation – Labor supply – Welfare evaluation – Extensive margin of labor supply.

October 1st-October 10: Chapter 2. Factor demand. SLIDES

Production technology – Profit maximization – Cost minimization and conditional factor demand – Unconditional factor demand.

October 15-November 5: Chapter 3. Market equilibrium. SLIDES

Partial equilibrium and welfare analysis – Compensating wage differences -  Adverse selection – Signaling. 

November 7-November 21.  Chapter 4. Regulation and incentives. SLIDES

Regulating natural monopolies – Regulation with asymmetric information – Regulation of output quality. 

Grading

The final grade for the class is comprised for 50% of a midterm and partially graded homework assignments and 50% of the grade in the final exam.

Midterm

The midterm will take place on Friday October 24 from 10:45am to 11:45am during the tutorial.

Problem sets and homework assignments.

Here are some partial answers to Problem 3 in Homework 2 and Problem 3 in Homework 4: Answers

Problem Set 0: will be covered in TA session on September 19 and September 26. Students should prepare for giving oral presentations on these problems by constituting groups of 3 students that prepare together (the whole group will earn the same grade even if only one of the students gives a presentation). Prepare the at least the first 5 problems for September 19.

Homework Assignment 1: due October 5 2025 on the Moodle platform:  get answers from a generative AI software for each of the questions and then write a comment on the generative AI output (pointing out errors, misinterpretations but also alternative and better ways to answer; you can also point out when you find that generative Ai provided a particularly nice answer). The homework should be entirely typed. 

Homework Assignment 2. Either problem 1 or problem 2 will be on the midterm on October 24. Problems 3 and 4 are due November 3rd 2025 on the Moodle platform: get answers from a generative AI software for each of the questions and then write a comment on the generative AI output (pointing out errors, misinterpretations but also alternative and better ways to answer; you can also point out when you find that generative Ai provided a particularly nice answer). The homework should be entirely typed.

Homework Assignment 3. Will be discussed in class on November 25 and November 28.