Osaka 2020/1st - Advanced Economic Theory

Advanced Economic Theory | Microeconomic Analysis 1

上級経済理論 | ミクロ経済分析1

• Syllabus in English | 講義シラバス（日本語）

• 1st semester, Mondays 2nd (10:30-12:00), Seminar Room 2（演習室2） → Changed to web-based course for the time being. See announcement below.

• Office Hours: To be announced

Last Update: July 20, 2020

Announcement | お知らせ

• [20/7/13] --- The deadline of the final report is July 31st (Fri).

• [20/7/13] --- There will be NO class on July 27th, so the last meeting is on July 20th.

• [20/4/27] --- Photos of the whiteboard in Lec3 (and future lectures as well) have been uploaded here.

• [20/4/20] --- The audio and whiteboard of the first two lectures is available here.

• [20/4/11] --- Our lectures will be web-based for the time being. The first lecture, April 13 from 10:30 a.m., will be an online class using Zoom. Please e-mail me <yosuke.yasuda@gmail.com> if you haven't received the meeting information via CLE.

• [20/1/15] --- The website (here) is open.

Course Objective and Content | 講義概要・目的

• We study economic theories in the border areas with other fields, such as decision making theory, behavioral economics, and incomplete contract theory.

  • [4/11] I pan to replace social choice theory with some chapters from the recent open-textbook below:

    • Models in Microeconomic Theory by Martin J. Osborne and Ariel Rubinstein

• This course is mainly based on students' presentations of representative research papers or/and chapters from the relevant textbooks for each topic.

Learning Goals | 学習目標

• • To acquire basic analytical skills on economic theories of 1) decision making, 2) social choice, and 3) incomplete contract.

  • To understand how these theoretical ideas are applied to real-life issues on business and policy rules.

Requirement / Prerequisite | 履修条件・受講条件

• • Microeconomics at advanced undergraduate level.

Grading Policy | 成績評価

• Based on the presentation and final report.

• Auditing students SHOULD also make presentation but need NOT submit the final report.

  • Presentation can be given in English or Japanese, but SLIDES must be typed in ENGLISH.

  • Final report can be written in Japanese or English. Suggested length is 2 - 5 pages. Your report should be either

    • 1) an original research paper/idea on the topics covered in the lecture,

    • 2) a referee report on a paper (which is not directly covered in class), or

    • 3) a survey on a specific issue of the relevant topics in the lecture.

Related Textbooks | 関連書籍

• Decision Making

  • Kreps, D. (1988). Notes On The Theory Of Choice. Westview Press. Amazon

  • Rubinstein, A. (2012). Lecture Notes in Microeconomic Theory, 2nd ed. Princeton University Press. Amazon

  • Gilboa, I. (2009). Theory of decision under uncertainty (Vol. 45). Cambridge university press. Amazon

    • 日本語（川越敏司 訳）：『不確実性下の意思決定理論』勁草書房. 2014. Amazon

  • Wakker, P. P. (2010). Prospect theory: For risk and ambiguity. Cambridge university press. Amazon

  • Chambers, C. P., & Echenique, F. (2016). Revealed preference theory (Vol. 56). Cambridge University Press. Amazon

• Social Choice

  • Arrow, K. J. (2012). Social choice and individual values (Vol. 12). Yale university press. Amazon

    • 日本語（長名寛明 訳）：『社会的選択と個人的評価』勁草書房. 2013. Amazon

  • Sen, A. (2018). Collective choice and social welfare. Harvard University Press. Amazon

    • 日本語（志田基与師 訳）：『集合的選択と社会的厚生』勁草書房. 2000. Amazon

  • Fishburn, P. C. (2015). The theory of social choice. Princeton University Press. Amazon

  • Feldman, A. M., & Serrano, R. (2006). Welfare economics and social choice theory. Springer Science & Business Media. Amazon

    • 日本語（飯島大邦ほか 訳）：『厚生経済学と社会選択論』CAP出版. 2009. Amazon

  • Thomson, W. (2019). How to divide when there isn't enough. Cambridge Books. Amazon

• Incomplete Contract

  • Hart, O. (1995). Firms, contracts, and financial structure. Clarendon press. Amazon

    • • 日本語（鳥居昭夫 訳）：『企業 契約 金融構造』慶應義塾大学出版会. 2010. Amazon

  • Bolton, P., & Dewatripont, M. (2005). Contract theory. MIT press. Amazon

  • Gibbons, R., & Roberts, J. (Eds.). (2013). The handbook of organizational economics. Princeton University Press. Amazon

  • Aghion, P., Dewatripont, M., Legros, P., & Zingales, L. (Eds.). (2015). The impact of incomplete contracts on economics. Oxford University Press. Amazon

Course Schedule | 講義日程

(Introductory parts -- Lectures 1 and 2 -- will be given by the instructor. All the rest consists of students' presentations.)

DECISION MAKING

Lecture 1. Choice over Certain Outcomes | 4/13

• Lecture

  • • Slide

Lecture 2. Choice over Risky Outcomes | 4/20

• Lecture

  • Slide

Lecture 3. Uncertainty | 4/27

• Presentations

  • Machina, M. (1987), pp.121-135 --- 方

  • Machina, M. (1987), pp.136-150 --- 王

  • References

    • TBA

Lecture 4. Ambiguity | 5/11

• • Presentations

  • Gilboa, I. and Schmeidler, D. (1989) --- 川中

  • References

    • Ellsberg, D. (1961)

    • Schmeidler, D. (1989)

  • Maccheroni, F., Marinacci, M. and Rustichini, A. (2006)

BEHAVIORAL ECONOMICS

Lecture 5. Prospect Theory | 5/18

• Presentations

  • Kahneman, D. and Tversky, A. (1979) --- 別府

• References

  • Tversky, A. and Kahneman, D. (1992)

  • Thaler, R. (1980)

Lecture 6. Fairness | 5/25

• Presentations

  • Rabin, M. (1993) --- カ セン

  • Fehr, E. and Schmidt, K. M. (1999) --- ソウ ロ

• References

  • Geanakoplos, J., Pearce, D. and Stacchetti, E. (1989)

  • Kahneman, D., Knetsch, J. L. and Thaler, R. (1986)

Lecture 7. Dynamic Inconsistency | 6/1

• Presentations

  • O'Donoghue, T., & Rabin, M. (1999) --- 長田

• References

  • Laibson, D. (1997)

  • Rubinstein, A. (2003)

  • Strotz, R. H. (1955)

  • Pollak, R. A. (1968)

Lecture 8. Axiomatic Approach | 6/8

• Presentations

  • Gul, F. and Pesendorfer, W. (2001) --- 鄭 凱中

  • Masatlioglu, Y., Nakajima, D., & Ozbay, E. Y. (2012) --- PEI JINGRU

• References

  • Kreps, D. M. (1979)

  • Dekel, E., Lipman, B. and Rustichini, A. (2001)

OSBORNE AND RUBINSTEIN (2020)

Lecture 9. Equilibrium | 6/15 => 6/22

• Presentations

  • Ch8: A Jungle --- 孫 鈺博

  • Ch9: A Market ---

• References

  • TBA

Lecture 10. Mechanism | 6/22

• • Presentations

    • Ch17: Mechanism Design --- 別府

    • Ch18: Matching ---

• References

  • TBA

Lecture 11. Society | 6/29

• Presentations

  • Ch19: Socialism --- 王

  • Ch20: Aggregating Preferences --- 川中

• References

  • TBA

INCOMPLETE CONTRACT

Lecture 12. Property Rights | 7/6

• Presentations

  • Grossman, S. J., & Hart, O. D. (1986) --- Song Lu

  • Hart, O., & Moore, J. (1990) --- 方

• References

  • • TBA

Lecture 13. Cooperate Governance | 7/13

• Presentations

  • Bolton, P., & Scharfstein, D. S. (1990) --- 何 璇

    • Aghion, P., & Bolton, P. (1992) --- PEI JINGRU

• References

  • TBA

Lecture 14. Authorities | 7/20

• Presentations

  • Aghion, P., & Tirole, J. (1997) --- 長田

    • Dessein, W. (2002) --- 鄭 凱中

• References

  • • TBA

Lecture 15. Relational Contracts

• Presentations

  • MacLeod, W. B., & Malcomson, J. M. (1989) ---

  • Levin, J. (2003) ---

• References

  • • TBA

Related Papers | 関連書籍論文

• Decision Making

  • Fehr, E. and Schmidt, K. M. (1999). A Theory of Fairness, Competition, and Cooperation, Quarterly Journal of Economics, 114: 817-868.

  • Gilboa, I., & Schmeidler, D. (1989). Maxmin expected utility with non-unique prior. Journal of Mathematical Economics, 18(2), 141-153.

  • Machina, M. (1987). Choice under Uncertainty: Problems Solved and Unsolved. Journal of Economic Perspectives, 1(1), 121-54.

    • <Related Papers>

    • Ellsberg, D. (1961). Risk, ambiguity, and the Savage axioms. The quarterly journal of economics, 643-669.

      • Maccheroni, F., Marinacci, M. and Rustichini, A. (2006). Ambiguity Aversion, Robustness, and the Variational Representation of Preferences, Econometrica, 74: 1447–1498.

    • Schmeidler, D. (1989). Subjective probability and expected utility without additivity. Econometrica: Journal of the Econometric Society, 571-587.

  • <Survey Articles>

    • TBA

• Behavioral Economics

  • Fehr, E., & Schmidt, K. M. (1999). A theory of fairness, competition, and cooperation. The quarterly journal of economics, 114(3), 817-868.

  • Gul, F., & Pesendorfer, W. (2001). Temptation and self‐control. Econometrica, 69(6), 1403-1435.

  • Kahneman, D. and Tversky, A. (1979), Prospect Theory: An Analysis of Decision under Risk, Econometrica, 47: 263–291.

  • Laibson, D. (1997). Golden eggs and hyperbolic discounting. The Quarterly Journal of Economics, 112(2), 443-478.

  • Masatlioglu, Y., Nakajima, D., & Ozbay, E. Y. (2012). Revealed attention. American Economic Review, 102(5), 2183-2205.

  • O'Donoghue, T., & Rabin, M. (1999). Doing it now or later. American economic review, 89(1), 103-124.

  • Rabin, M. (1993). Incorporating fairness into game theory and economics. The American economic review, 1281-1302.

  • <Related Papers>

    • Geanakoplos, J., Pearce, D. and Stacchetti, E. (1989), Psychological games and sequential rationality, Games and Economic Behavior, 1: 60-79.

    • Kahneman, D., Knetsch, J. L. and Thaler, R. (1986), Fairness as a Constraint on Profit Seeking: Entitlements in the Market, American Economic Review, 76: 728-741.

      • Kreps, D. M. (1979). A representation theorem for" preference for flexibility". Econometrica: Journal of the Econometric Society, 565-577.

    • Rubinstein, A. (2003). “Economics and Psychology”? The Case of Hyperbolic Discounting, International Economic Review, 44: 1207-1216.

    • Thaler, R. (1980). Toward a positive theory of consumer choice. Journal of economic behavior & organization, 1(1), 39-60.

    • Tversky, A. and Kahneman, D. (1992), Advances in prospect theory: Cumulative representation of uncertainty, Journal of Risk and Uncertainty, 5: 297-323.

  • <Survey Articles>

    • TBA

• Osborne and Rubinstein

  • TBA

• Incomplete Contract

  • Aghion, P., & Bolton, P. (1992). An incomplete contracts approach to financial contracting. The review of economic Studies, 59(3), 473-494.

  • Aghion, P., & Tirole, J. (1997). Formal and real authority in organizations. Journal of political economy, 105(1), 1-29.

  • Bolton, P., & Scharfstein, D. S. (1990). A theory of predation based on agency problems in financial contracting. The American economic review, 93-106.

  • Dessein, W. (2002). Authority and communication in organizations. The Review of Economic Studies, 69(4), 811-838.

  • Grossman, S. J., & Hart, O. D. (1986). The costs and benefits of ownership: A theory of vertical and lateral integration. Journal of political economy, 94(4), 691-719.

  • Hart, O., & Moore, J. (1990). Property Rights and the Nature of the Firm. Journal of political economy, 98(6), 1119-1158.

  • Levin, J. (2003). Relational incentive contracts. American Economic Review, 93(3), 835-857.

  • MacLeod, W. B., & Malcomson, J. M. (1989). Implicit contracts, incentive compatibility, and involuntary unemployment. Econometrica: Journal of the Econometric Society, 447-480.

  • <Related Papers>

    • TBA

  • <Survey Articles>

    • TBA

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