Core - Microeconomics

• M100 - Microeconomics I

  The aim is to provide a rigorous graduate level training in microeconomic theory. Topics covered include: consumer and producer theory; choice under uncertainty; general equilibrium theory; game theory; contract theory; industrial organisation.

• M110 - Microeconomics II

  This course builds on Microeconomics I, and aims to provide an introduction to two broad subjects. (1) Mechanism Design is concerned with implementation of collective decision rules when individuals hold relevant private information, and ensuring truthful revelation of such information constraints the structure of institutions used. (2) The fundamental question in General Equilibrium is whether there is a set of non-negative prices for which the market clears in an economy with price taking, optimising consumers and firms. Conditions under which competitive equilibria exist, their structure and basic welfare properties will be covered.

• M120 - Topics in Economic Theory

  This course is a topics course on some issues in economic theory. Part of the course will be taught by Guilherme Carmona, who will focus on dynamic games. The course covers the theory of repeated games with complete information, including:

  • The one-shot deviation property
  • Automaton representation of strategies
  • Sufficiency of simple strategies
  • The Folk Theorem

  The applications are likely to include:

  • Bounded memory
  • Dynamic risk sharing
  • Multi-person bargaining
  • Social learning.

  The second part of the course will be taught by Robert Evans, who will cover various topics in contract theory and strategic communication theory. These are likely to include incomplete-contracts theory, property rights theory, relational contracts, and the Crawford-Sobel analysis of cheap talk and its applications to the theory of organizations.

• M130 - Applied Microeconomics

  This is largely a course in applied price theory. It begins with a review of consumer and producer theory, with a thorough discussion of duality. We then turn to extensions such as intertemporal choice and saving behaviour; household production, household bargaining and labour supply; measuring the cost of living and the welfare cost of price changes; the demand for durables, investment and human capital investment; factor demand and supply under perfect and imperfect competition. These are basic tools on which is based much analysis in a range of fields of economics including public finance, development economics, industrial organization, labour economics, health economics and macroeconomics.

  Throughout, there will be a heavy emphasis on the interplay between theory and data. We will consider, on the one hand, how theories can be tested and theoretical parameters estimated, and on the other hand, how theory can structure and inform our understanding of the data. There will also be a strong focus on the use of a mix of price theory and relevant data to answer interesting and policy relevant questions. The policy issues to be considered will vary from year to year according to the issues of the day, but illustrative examples include: the incidence of indirect taxation; inputs to competition policy; policies to raise household saving; the welfare costs of taxation; the welfare costs of monopoly power; the measurement of inflation; fiscal policies to promote household spending; policies to encourage employment and investment by firms.