09446 - Microeconomics

Learning outcomes

The successful student should know the basics of microeconomic analysis. In particular, s/he will be able to assess the behaviour of consumers and firms, and how markets work; to identify theoretically relevant market models; to apply microeconomic principles in looking at the real world.

Course contents

Please note: This is an introductory course in microeconomics, which provides the basic analysis of the economic agents' behaviour and the end result of their interaction.

Course content

Part 1

1. An introduction to political economy: Methodological problems; using models; microeconomics and macroeconomics.

2. Theory of consumers' behaviour and general equilibrium in pure exchange:

·     preference representation and budget constraints; individual demand: demand functions (marshallian and hicksian) and engel curves; consumers' surplus;

·     intertemporal choice and choice under uncertainty;

·     general equilibrium in pure exchange; Pareto efficiency and the core; the fundamental theorems of welfare economics;

·     introductory remarks on the economics of information: moral hazard and adverse selection.

3. Production and costs:

·     theory of production.

·     cost theory.

 

Part 2

4. The economics of markets:

·     aggregation and market demand, elasticity and comparative statics;

·     perfect competition and monopoly;

·     product differentation and monopolistic competition; Chamberlin and Hotelling;

·     oligopoly: non cooperative games and Nash equilibrium; the standard models of Cournot, Bertrand and Stackelberg; repeated games and collusion; games in extensive form and entry barriers;

·     natural monopoly and contestability; introductory remaks on the economics of regulation.

.     factor markets

5. Economic efficiency and welfare:

·     externalities and the Coase theorem;

·     public goods and public choices.

Readings/Bibliography

R.H. Frank, Microeconomia. Comportamento razionale, mercato e istituzioni. McGraw-Hill Italia, Milano, sesta edizione (cap. 1, 2, 3, 4, 5, 6, 9, 10, 11, 12, 13, 14, 15, 16, 17).

Further information about contents, the final exam, exam samples and lecture slides are available at

https://elearning-cds.unibo.it/course/view.php?id=8966

Assessment methods

Written test.

Office hours

See the website of Rainer Andergassen