Scheduling: We meet in Weeks 2--8, usually on Wednesday afternoon (except for Week 2), in FB1 Rm 10. In the first two weeks we meet as one group of six:
Week 2: Thu 4:00--6:00pm
Week 3: Wed 4:00--6:00pm
Thereafter we shall meet in two groups, on Wednesday afternoons:
Group 1, Wed 4:00--5:20pm: Emma, Rory, Luke
Group 2, Wed 5:30--6:50pm: Sebastian, Jane, Matthew
Problem sets: Each week -- no later than Tuesday evening -- I shall assign a subset of the problems from the tutorial worksheets posted on the course weblearn page. These must be submitted to me, via the Lodge, by 3pm on Sunday. I may not grade your answers to all the problems that have been assigned, but possibly only a certain subset of these (to be decided upon after you have submitted your solutions); in the classes I shall give priority to going through the solutions to those questions that I do not grade.
I shall also assign readings to complement the lecture slides: generally these will be drawn from Perloff, Intermediate Microeconomics with Calculus (2nd or 3rd ed.) and Varian, Intermediate Microeconomics (8th or 9th ed.) [In most cases, the two overlap considerably, and it is probably necessary to read only one of these.] You may also find it helpful to occasionally consult the Maths Workbook that I sent you a copy of during the summer.
Format: While the classes will focus mostly on covering the solutions to the problem sets, I am very happy to discuss any questions you may have about the lecture material (and assigned readings). It would help if you could email me any questions that arise in advance of our meeting, so I have a chance to think about them.
Problems: 1, 2, 3, 5, 6, 7
Readings: Perloff Ch 1 ('Introduction'), Ch 2.1--2.5 ('Supply and Demand'), and Ch 7.1 ('Measuring Costs') should be sufficient. Comparable readings in Varian would be: Ch 1 ('The Market') which gives a basic overview; Ch 15 ('Market Demand') covers demand and elasticities (you might skip 15.7, 15.9 and 15.10); Ch 16 ('Equilibrium'), specifically Sections 16.1--16.5, covers equilibrium and comparative statics. (If you find Ch 15 and 16 a bit too advanced at this stage, that is fine, just stick to Perloff this week.)
Problems: 1c, 1d, 2, 3, 4, 5
Readings: Perloff Ch 2.6--2.8 ('Supply and Demand'), Ch 5.1 ('Consumer Welfare'), Ch 5.3 ('Market Consumer Surplus'), and Ch 10.4 ('Production and Trading' -- but only the subsection 'Comparative Advantage'; note there is some material on marginal rates of substitution at the very end of this section which will not be intelligible to you yet). Varian Ch 16.6-16.9 ('Equilibrium') also has a good coverage of taxes and welfare; Ch 33 ('Production') has a good coverage of trade and comparative advantage, but is probably too advanced for you at this stage.
From this week you will be split into two groups: Group 1 (Emma, Rory and Luke) meets at 4:00--5:20pm; Group 2 (Sebastian, Jane and Matthew) at 5:30--6:50pm.
Problems: 1, 2, 3, 4, 5
Readings: Perloff Ch 6 ('Firms and Production'), Ch 7.2--7.4 ('Costs'), and Ch 8.1--8.3 ('Competitive Firms and Markets'). Alternatively (or additionally), you may consult Varian Ch 19 ('Technology'), Ch 20 ('Profit Maximisation'), Ch 21 ('Cost Minimisation'), Ch 22 ('Cost Curves'), and Ch 23 ('Firm Supply').
This week only, your work is due at 5pm on Monday.
Problems: 1, 2, 3 + the essay below:
Write an essay on Q4 ('Explain and compare ...'): 800--1000 words in length; the essay must be typed, with at least 1.5 spacing, and margins of at least 2cm. Accompanying diagrams are encouraged, and may be drawn by hand (but please label these 'Figure 1', Figure 2', etc., and refer to them in this manner in the text). Before you start, make sure to consult: 'Preparing for Examinations in Economics' (which has a lengthy section on how to write an economics essay) and 'Marking Criteria for Essay Questions in Economics' (but note that, at Oxford, grades in excess of 75 for an essay are almost unheard of), which can be found in the 'Examinations' section on the Undergraduate Economics weblearn site.
Readings: Perloff Ch 8.4 ('Competition in the Long Run') and Ch 9.1 ('Zero Profit for Competitive Firms ...') covers residual material on perfectly competitive markets. [Although it does not relate directly to the material covered in this week's lectures, you might also find it useful to read the other subsections of Ch 9, which cover producer surplus and the welfare consequences of various interventions in competitive markets.] Net present value is covered in Perloff Ch 15.2 ('Capital Markets and Investing'). For relevant material on Game Theory and oligopoly, see Perloff Ch 13.1--13.2 ('Game Theory') and Ch 14.1-14.5 ('Oligopoly'). [Although we don't cover it in this course, you should also read Ch 14.6 ('Monopolistic Competition'), since this is a fundamentally important model of markets with differentiated products.] Comparable readings in Varian are: Ch 24 ('Industry Supply'); Ch 28 ('Oligopoly'); Ch 29 ('Game Theory'); Ch 30 ('Game Applications').
This week only, your work is due at 5pm on Tuesday.
Problems: 1, 2, 3, 4, 5
Readings: Perloff Ch 3 ('Consumer Theory'), Ch 4.1-4.3 ('Demand') and Ch 5.5 ('Deriving Labor Supply Curves'). Similar material is covered in Varian Ch 2--6 and 8 ('Budget Constraint', 'Preferences', 'Utility', 'Choice', 'Demand', 'Slutsky Equation'). The material covered in the lectures on demand curves for a consumer with a given endowment (the labour supply and intertemporal choice examples) is discussed in most detail in Varian Ch 9 ('Buying and Selling'); I could not find as clear a treatment of this in Perloff.
The assigned problems are due 5pm Monday (19 Nov); the essay is due the following Monday (26 Nov; also at 5pm)
Problems: 1, 2, 4, 5. [Note: in Q4(c), the 'welfare effects' should be measured in terms of compensating or equivalent variation. In Q5(f): to construct a 'money-metric measure of the welfare cost', think about how you could measure the distance between the relevant indifference curves at an appropriate set of prices (much in the manner of compensating or equivalent variation).]
Write an essay on this question (an expanded version of a question given in the worksheet). This is due at 5pm on the Monday 26 Nov; we will discuss it in Week 8's tutorial. Please take account of my comments on your previous essay before attempting it.
Readings: Perloff Ch 5.2 ('Expenditure Function and Consumer Welfare') covers equivalent and compensating variation; Ch 4.4 ('Cost-of-Living Adjustment') has a brief coverage of price indices. You should also read Ch 4.5 ('Revealed preference') and 5.4 ('Effects of Government Policies ...') even though the former goes a little beyond what was covered in lectures. From Varian, you could consult: Ch 11 ('Intertemporal choice' -- relevant to last week's material), Ch 14 ('Consumer's Surplus'), and possibly Ch 15 ('Market Demand').
The essay assigned last week is due 5pm Monday. The problems below are due 5pm Tuesday.
Problems: 1, 3, 4
Readings: Perloff Ch 11 ('Monopoly and Monopsony'), Ch 12.1--12.5 ('Pricing and Advertising') and Ch 17 ('Externalities and Public Goods'). Similar material is covered in Varian Ch 25 ('Monopoly'), Ch 26 ('Monopoly Behavior'), Ch 35 ('Externalities') and Ch 37 ('Public Goods').
Held on Wednesdays, 16:30--18:30 in the PPE Suite. In preparation for these classes, please:
Prepare bullet-point outline responses for each of the nominated essay questions
Attempt the problem questions
I would strongly advise giving priority to the essay questions, since these tend to give students the greatest difficulty.
We will start the classes by discussing the essay questions (I will be reliant on your input here, so you need to have looked at these carefully in advance of the class), before reviewing as many of the problem questions as time permits.
Lecture material: MT1--MT4 ('Exchange' and 'Firms')
Essay questions: 2016LVq7, 2016TTq7 and the following question from the 2016 Collection: "Explain the concept of Net Present Value (NPV) and how it can be used in investment appraisal. How does the choice of the interest rate influence the NPV of the project?"
Problems: 2017LVq2, 2017LVq3, 2016LVq3
[Note: 2017LV = 2017 Long Vac exam, etc. -- these are all available on OXAM.]
Lecture Material: MT5--MT8 ('Individuals' and 'Market failures')
Essay questions: 2017LVq8, 2016LVq8, 2016TTq8
Problems: 2017LVq1, 2016TTq1, 2015TTq3