A study of decision making. You make a hundred choices every day, from choosing a time to get up until you decide when to go to bed. In this class, we will think about how people make these choices and how everyone’s choices interact with each other to form a market economy. This class will help you organize your thinking about market economies and might even help you make better decisions. More generally, you will be able to analyze real-life scenarios using an economic way of thinking.
The class will begin by building a model of production and how people might cooperate for mutual advantage. We will then look at the advantages and disadvantages of using markets to coordinate economic activity and the impact of government efforts to address some disadvantages. The second half of the course will concentrate on firms, examining the effects of market power (the ability to manipulate prices) and entry into and exit from a market.