Advanced Microeconomics I (2009)

Last up-dated: June 11, 2009

0. Important Announcement

  • The final exam will be on June 11 from 10:40-12:10. April 26

  • There will be NO class on April 30 (Thu). April 23

  • There is a Make-Up class on April 26 (Sunday!) from 14:00-17:00. April 23

  • The first lecture starts from 13:20 on April 9 (Thu) in room 5D. Look forward to seeing you there! April 9

1. Course Description syllabus

This is an advanced course in microeconomics, emphasizing the applications of mathematical tools and models to the study of individual economic decisions and their aggregate consequences. We begin with a parsimonious set of hypotheses about human behavior and the ways in which individual choices interact, and then examine the implications for markets. This entails treatments and applications of consumer theory and theory of the firm, under the ideal conditions implied by our hypotheses. Course grade will be determined by combining grades on problem sets (30%) and a final exam (70%).

2. Course Outline long version

  1. Sets and mappings

    • [JR] Ch.A1

  2. Preferences

    • [NS] Ch.3

    • [R] Ch.1

  3. Topology

    • [JR] Ch. A1

  4. Utility

    • [NS] Ch.3

    • [R] Ch.2, Ch.4

  5. Choice

    • [NS] Ch.3

    • [R] Ch.3

  6. Demand

    • [R] Ch.4, Ch.5

    • [V] Ch.7

  7. Optimization 1: Existence

    • [JR] Ch.A1

  8. Optimization 2: Solving Method

    • [NS] Ch.2

    • [JR] Ch.A2

    • [V] Ch.27

  9. Optimization 3: Characterization

    • [NS] Ch.4

    • [JR] Ch.A2

  10. Consumer Problem

    • [NS] Ch.4

    • [R] Ch.6

    • [JR] Ch.1

  11. Duality

    • [NS] Ch.5

    • [R] Ch.6

    • [JR] Ch.1

  12. Production and cost functions

    • [NS] Ch.9, Ch.10

    • [R] Ch.7

  13. Profit maximization

    • [NS] Ch.11

    • [R] Ch. 7

  14. Expected utility

    • [NS] Ch.7

    • [R] Ch.8, Ch.9

  15. Risk aversion

    • [NS] Ch.7

    • [R] Ch.8

  16. Final exam

    • Files: exam solution

3. Problem Set

Problem sets count for 30% of the grade. Each problem set is distributed in class and will be due a week later. Because solutions are published, late problem sets cannot be accepted. You are encouraged to form study group, but must write up solutions independently.

  • Problem set 1 (due on May 7)

    • Files: problem solution

  • Problem set 2 (due on June 4)

    • Files: problem solution

4. Textbooks

There are two main textbooks for this course:

[NS] Walter Nicholson and Christopher Snyder, Microeconomic Theory: Basic Principles and Extensions, 10th edition, 2007

[R] Ariel Rubinstein, Lecture Notes in Microeconomic Theory, 2006. Latest version downloadable from author's page for free

Useful textbooks at roughly the same level as [NS] are:

[JR] Geoffrey Jehle and Philip Reny, Advanced Microeconomic Theory, 2nd edition, 2000

[V] Hal Varian, Microeconomic Analysis, 3rd edition, 1992

Those of you look for more lucid treatment than the above textbooks may consult with the following authoritative sources. The former incorporates game theoretical perspectives, and the latter is a standard textbook most widely used in Economics Ph.D. microeconomics courses.

[K] David Kreps, A Course in Microeconomic Theory, 1990

[MWG] Andreu Mas-Colell, Michael Whinston and Jerry Green, Microeconomic Theory, 1995

A classic textbook for theory and applications on consumer demand is:

Angus Deaton and John Muellbauer, Economics and Consumer Behavior, 1980

A well-written book for optimization techniques, which provides full of intuitive explanation is:

Avinash Dixit, Optimization in Economic Theory, 2nd edition, 1990

A more advanced but highly readable textbook on optimization is:

Rangariajan Sundaram, A First Course in Optimization Theory, 1996

The followings are comprehensive and rigorous textbooks on mathematics for economics both of which contain variety of economic applications.

Angel de la Fuente, Mathematical Methods and Models for Economists, 1999

Efe Ok, Real Analysis with Economic Applications, 2007

The latest comprehensive graduate level textbook on mathematics for economics (and econometrics) is:

Dean Corbae, Maxwell Stinchcombe, and Juraj Zeman, An Introduction to Mathematical Analysis for Economic Theory and Econometrics, 2009

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