Semester-III

Intermediate Microeconomics-I

Paper: ECO-A-CC-3-5-TH

Unit 1: Theories of Consumer Behaviour and Applications

1.1 Inter-temporal choice (saving and borrowing)

1.2 Revealed preference

1.3. Choice under uncertainty – utility function and expected utility, risk aversion and risk preference

1.4 Applications of Consumer Behaviour in Construction of Price Indices – Laspeyers and Paasche‘s indices

2. Unit 2: Production and Costs

2.1 Technology – general concept of Production Function, production with one and two variable inputs,total average and marginal products, short run and long run, returns to factor and returns to scale, Isoquants, marginal rate of technical substitution, isocost line and firm‘s equilibrium, elasticity of substitution

2.2 Types of production functions- Cobb-Douglas, fixed-coefficient and CES functions

2.3 Cost structure- implicit cost, explicit cost, accounting cost, sunk cost, economic cost, fixed cost, variable cost, total, average and marginal cost. Determinants of short run cost, cost curves, cost minimization and expansion path, short versus long run cost curves, economies of scale.

3. Unit 3: The Firm and Perfect Market Structure

3.1 Organization, Firms and Profit Maximization

3.2 Marginal Revenue, Marginal Cost and Profit Maximization

3.3 Perfect competition- short run competitive equilibrium of the firm, short run supply curve of firm and industry, Output choice and competitive equilibrium in long run, Economic rent and profit, long-run industry supply- constant, increasing and decreasing cost.

3.4 Consumer and Producer surplus, welfare and efficiency of competitive equilibrium. Government intervention and dead weight loss, Application- Minimum prices and price supports ( price ceiling and price floors)

4. Unit 4: Input Market in Perfect Competition

4.1 Basic concepts- derived demand, productivity of an input, marginal product of an input, marginal revenue product

4.2 Marginal productivity theory of distribution

4.3 Labor market-supply of labor, competitive labor markets

4.4 Land markets and rent

Intermediate Macroeconomics-I

Paper: ECO-A-CC-3-6-TH

1. Income Determination in the Short-run (Part-II) : The IS-LM Model

• • IS-LM Model - equilibrium, stability and comparative statics. Crowding out .Effects of fiscal and monetary policies.

2. Aggregate Demand and Aggregate Supply- the Complete Keynesian Model

• • Derivation of aggregate demand curve.

  • Derivation of aggregate supply curves both in the presence and absence of wage rigidity.

  • Equilibrium, stability, and comparative statics-effects of monetary and fiscal policies. Effects of wage cut. Unemployment equilibrium and its causes- possible solutions including real balance effect.

3. Keynes vs. Classics

• • Keynesian vs classical system.

  • Hybrid models under Classical/Keynesian framework.

  • Friedman‘s restatement of classical ideas

4. Money Supply, Monetary Policy and Government Budgetary Operations

• • Measures of money supply with special reference to India (M₁,M₂, M₃ and M₄)

  • Balance sheet view of money supplied by the banking sector as a whole

  • High powered money –definition

  • Balance sheet of Reserve Bank of India and High powered money

  • Balance sheet of Commercial banks and basic ideas of money multiplier theory.

  • Deposit multiplier, currency multiplier, reserve multiplier, credit multiplier and money multiplier in the context of the theory of money supply

  • Interest sensitivity of money supply and the slope of the LM curve.

  • Monetary policy – Open Market Operations, Statutory Liquidity Ratio, Bank rate, variable reserve ratio, repo rate.

  • Government Budget Deficit and Deficit Financing-Indian illustration. Deficit financing and monetary policy.

5. Inflation, Unemployment and Expectations

• • The concept of Inflationary Gap.

  • Demand pull vs. Cost push inflation

  • Mark-up inflation

  • The concept of stagflation

  • Central Bank‘s role in controlling inflation: Monetary policy.

  • Inflation and unemployment trade-off.

  • Four models of aggregate supply: The Sticky-Wage Model, The Worker-Misperception Model, The Imperfect Information Model and The Sticky-Price Model.

  • Deriving the Phillips Curve from Aggregate Supply Curve.

  • Short run and long- run Phillips curve – role of adaptive expectations and rational expectations.

  • Disinflation, Sacrifice Ratio and policy ineffectiveness.

Statistical Methods for Economics

Paper: ECO-A-CC-3-7-TH

1. Introduction and Overview

• Subject-matter - the distinction between population and sample

• Representation of data- graphical (line diagram, bar diagram, pie chart) and tabular method

• Frequency Distribution

2. Descriptive Statistics

• Measures of central tendency(arithmetic mean, geometric mean, harmonic mean, median and mode, and their properties, Quartiles, Deciles and Percentiles)

• Dispersion(range, quartile deviation, mean deviation, standard deviation, coefficient of variation, coefficient of mean deviation, coefficient of quartile deviation, Lorenz curve and Gini coefficient)

• Moments, Skewness and Kurtosis (definition, computation)

• Correlation and Regression (definition, computation, properties)

3. Elementary Probability Theory

• Sample spaces and events (concepts and definitions using set theory)

• Axiomatic definition of probability and properties, theorem of total probability

• Conditional probability, theorem of compound probability

• Bayes‘ theorem and its applications.

4. Probability Distributions

• Random variable(discrete and continuous)

• Probability distributions (pmf, pdf. Distribution functions)

• Expected values of random variables (mean,variance, raw moment, central moment, moment generating functions)

• Properties of commonly used discrete and continuous distributions:

• Binomial -(derivation of pmf, mean,variance, moments, moment generating functions, problems)

• Poisson - (derivation of pmf, mean, variance, moments, moment generating functions, problems)

• Normal - (derivation of pdf, mean, variance, moments, moment generating functions, problems)

• Joint distribution functions of random variables (discrete and continuous) - joint pdf (pmf), marginal pdf (pmf)., conditional pdf (pmf)

5. Sampling

• Principal steps in a sample survey (concepts of population, sample, parameter, statistic)

• Methods of sampling- SRSWR, SRSWOR(use of random sampling numbers)

• Stratified sampling (basic concepts only)

• Multi-staged sampling (basic concepts only)

• Sampling distribution of sample mean and sample proportion Mean and standard error both in SRSWR and SRSWOR

• Standard normal, chi-square, Student‘s t and F distributions – definitions, important properties (mean and variance)

6. Statistical inference

• Point estimation-Properties of a good estimator;

• Basic principles of Ordinary Least Square, Maximum Likelihood Method [1 lecture hour] Method of Moments;

• Interval estimation.

• Testing of hypothesis (basic conceptsof null hypothesis, alternative hypothesis, type I and Type II errors, power of a test, p-value)

Skill Enhancement Course-I

Data Analysis (DA)

Unit 1: Collection and representation of data

• Collection of data (some methodological issues)

  • Census

  • Sample survey

• Representation of data

• The basics of data management in Stata / R / Eviews / SPSS / MS Excel

Unit 2: Indian Official Statistics (Basic concepts)

• Central Statistical Office (CSO) – National Accounts Statistics (NAS), Industrial Statistics (ASI, IIP)

• National Sample Survey Office (NSSO) – Household Consumer Expenditure Survey Rounds, Employment and Unemployment Survey Rounds

• Census of India – Population Census 2011

• Reserve Bank of India (RBI) – Handbook of Statistics on Indian Economy (Selected parts)

Skill Enhancement Course-I

Rural Development (RD)

1. Aspects of Rural Development

• • Concept of Rural Development

  • Rural Development vs. Agricultural Development

  • Role of NGOs in Rural Development

  • Rural Non Farm Sector and Rural Development

2. Panchayats and Rural Development

• • Decentralized Planning and Participatory Development

  • Role of Panchayats in Decentralized Rural Development

  • Participatory Rural Appraisal

  • Panchayats and Rural Development in West Bengal

3. Rural Credit and Self Help Groups(SHGs)

• • Role National Bank for Agriculture and Rural Development (NABARD) for promoting Rural Development

  • Constraints of micro-enterprises in rural areas

  • Credit needs for rural non farm sector.

  • The concept of Micro credit

  • Micro credit and the role of Grameen Bank

  • Need for SHG for formation and features of SHG

  • SHGs in India

4. Critical Evaluation of Selected Government Programmes and Rural Development

• • Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) and Rural Development

  • Child labour and school drop-out in rural areas. Mid-day Meal and Rural Development

  • National Rural Health Mission (NRHM) and Rural Development

  • Pradhan Mantri Gram Sadak Yojana (PMGSY) and Rural Development