Welcome to the Economics 210A Website. If you are
taking
Econ 210A, please check this site regularly. I will use this site
for
posting
announcements about assignments. This is the first time that I
have taught this course, so the web site is going to have to grow as we
go.
| Announcements |
| The main textbook for this course is the weighty
Microeconomic
Theory, by Mas Collel, Whinston and Green, which
you should purchase and use as a reference throughout your economics
career. The second textbook for this course is the svelte Lectures in Microeconomic Theory
by Ariel Rubinstein.
It costs $67 ($2 per page) from Amazon.com. It would be
worth the Amazon price if that were the only way you could get it, but
Professor Rubinstein has put it online for free. More Free Resources. I have put a pdf copy of Workouts in Microeconomic Theory by Bergstrom and Varian online for this class. This is a workbook that accompanies Varian's undergraduate intermediate microeconomics text Intermediate Economics. I will occasionally assign problems from this book. If you want a paper copy, you can probably pick up an old edition pretty cheaply and old editions are just about as good as the new one. Same goes for Varian's text (currently in its 7th edition). Some of you might find the Varian text a good place to brush up on intermediate micro. Do you need to brush up on elementary logic and set theory? I suggest reading two chapters from Kenneth May's ``Elements of Modern Mathematics.'' Here they are: Elementary Logic, Elementary Theory of Sets. It has many nice problems and applications (with answers supplied) and is written with wit and charm. Do you want to read a solid, clear exposition of the mysteries of concave and quasi-concave functions? Let me suggest this chapter from Simon and Blume's ``Mathematics for Economists'' . And while you are at it, why not have a look at their chapter on homogeneous and homothetic functions. In my opinion, most economists would benefit from having the Simon-Blume book as a reference. Want a quick brush-up on logic, sets, concavity, matrices, multivariate calculus, and related mathematical toos for economics. Take a look at this tutorial by Martin Osborne. |
| Problems will be assigned each week. You will be required to work them and turn them in. I have no objections to your working together, but I will ask you to acknowledge any help that you have had on particular problems. |
| Reading Assignments |
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| Preferences,
Utility and Choice |
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| Required Reading Mas Collel, Whinston, Green: Chapter 1 Rubinstein Chapter 1 Rubinstein Chapter 3 (we will look at Chapter 2 later) Recommended reading: The purpose of these readings are to show you some alternative views of utility theory and to help to motivate our study of preferences, utility and choice. You should delve into each of these papers, though you may want to do some skipping. Francis Ysidro Edgeworth's, Mathematical Psychics, written in 1881, is one of the great books in the history of economics--and what a great title. Through the wonders of Google Books, this book is now on the web, available for free. You will note that it was scanned from the Stanford Library. ( In the first several pages, some annoying twit with a tin ear for good prose tried to copy-edit Edgeworth's text in the library copy. Fortunately this imbecile ran out of steam well before the end of the book.) Much of the analysis, particularly the early part on exchange is completely modern and remains extremely influential. The discussion of utility though lucid and clear seems alien to current ways of thinking. I suggest that you dip into the section on utilitarian calculus, starting on page 56, where we see that Edgeworth is thinking of utility as a tool for comparing the happiness of one person with that of another. The passages on the utility of the "lower classes" and of women will remind us of how much attitudes have changed since Victorian England. The Appendix on Hedonimetry, pp 98-102, is I think thought-provoking and worthwhile for every economist to read. Who can resist passages like the following: "To precise the ideas, let there be granted to the science of pleasure what is granted to the science of energy ; ' to imagine an ideally perfect instrument, a psychophysical machine, continually registering the height of pleasure experienced by an individual, exactly according to the verdict of consciousness, or rather diverging therefrom according to a law of errors. From moment to moment the hedonimeter varies ; the delicate index now flickering with the flutter of the passions, now steadied by intellectual activity, low sunk whole hours in the neighbourhood of zero, or momentarily springing up towards infinity. The continually indicated height is registered by photographic or other frictionless apparatus upon a uniformly moving vertical plane. Then the quantity of happiness between two epochs is represented by the area contained between the zero-line, perpendiculars thereto at the points corresponding to the epochs, and the curve traced by the index ..." Here is an interesting take on an evolutionary explanation of preferences. Evolution and Human Nature by Arthur Robson Journal of Economic Perspectives, Spring 2002, pp 89-106 Can utility be interpreted as a measure of happiness? Here are two interesting papers relevant to this question. Explaining Happiness by Richard Easterlin, Proceedings of the National Academy of Sciences, Sept 2003, pp11176-11183 Hedonic Adaptation by Shane Frederick and George Loewenstein in Scientific Perspectives on Enjoyment, Suffering, and Well-Being, edited by D. Kahneman, E. Diener, and N. Schwartz, 1999, Russell Sage Foundation, New York |
|
| Consumers and Demand | |
Week 2 Chapters 2A-2C and Chapters 3A-3C MWG Chapter 4 Rubinstein See Homework assignments below Week 3 Chapter 3D MWG Chapter 5 Rubinstein See Homework assignments below Week 4 Read MWG Chapter 2D,2E, 2.F Also, Appendix M.A, M.B and MC in MWG Week 5 Read MWG Chapter 3D,3E,3F,3G Optional reading on the Alchian-Allen shipping out the good apples "theorem" Week 6 Read Rubinstein Chapter 6 (especially the part about turtles) and MWG Chapter 4. Notes on separability by Ted Bergstrom, November, 2007 These notes are approximately what we did in class in the last two lectures. The exercises in the notes are not assigned for your homework, though they probably will be for the next class that uses them. I am still revising these notes and especially need to fill out more detail in the latter part. I will be grateful for zny suggestions, comments, or corrections. |
|
| Production | |
| Week 7 Read Rubinstein Chapter 7 MWG 5A, 5B Notes on homogeneous and homothetic production functions: Ted Bergstrom These notes need to be cleaned up and elaborated. But you might find them useful. |
|
| Choice under uncertainty | |
| Week 9 Read MWG
chap 6A, 6B Week 10 Complete MWG chap 6 Daniel Bernoulli Exposition of a new theory on the measurement of risk written in 1738, translated from Latin to English and published in Econometrica 1954 Anscombe and Aumann A Definition of Subjective Probability , Annals of Mathematical Statistics, 1963, vol 34, no 1, pp 199-205 |
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| Homework
Assignments |
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| Week
1, Due Mon October 8 MWG 1.B.1-5 MWG 1.C.1-2 MWG 1.D.2 Rubinstein Lecture 1, Problem 1 and Problem 2. Rubinstein Lec 3, Prob 1 a,b,c, h. Problem 3. Week 2, Due Monday October 15 Read MWG Sections 2.A,2-B, 2-C, 2.D and 3.B Read Rubinstein Lecture 2 pp 12-18 and Rubinstein Lecture 4. Do problems: MWG 2.D.1, 2.D.2, 2.D.3 MWG 3.B.1, 3.C.1, 3.C.4 Bergstrom and Varian Workouts Problems 3.3-3.15 Week 3, Due Monday October 22 This week you will have a short reading assignment, and only a couple of problems from your graduate texts, but I am assigning a whole slew of elementary problems from Workouts. The purpose of these exercises is to help you to become adept in working with simple examples. Some have little twists designed to make you think. Feel free to work with other students on these problems, but make sure you can do them. Read MWG Section 3.C Rubinstein Lecture 5 Do problems: MWG 3.D.1 MWG 3.D.6 Workouts Problems 4.1-4.8 and 4.11-4.12 Workouts Problems 5.1-5.7 Workouts Problems 6.1-6.8, 6.12-6.13 Week 4, Due Monday October 29 Problems Rubinstein 5.1, 5.3, 5.4 MWG 2.D.1 2.D.2 2.E.1 2.E.7 Workouts All problems in Chapter 7. Week 5, Due Monday Nov 5 Problems: MWG 3.D.7, 3.E.2, 3.E.6, 3.G.3 Workouts Problems 8.1-8.6 and 8.10-8.11 Week 6, Due at Section Meeting Rubinstein, Chapter 6, Problem 1 Nov 15-(I souped up the Gorman polar form problem below, adding more hints to problem 2 and adding another version of problem 2.) Online Problems with Gorman polar form utility Week 7, Due at Section Meeting Rubinstein Problems 7.1 and 7.2 Workouts Problems 20.1-20.13. Week 9, Due at Section Meeting Workouts Problems 22.3, 22.6-22.9 Workouts Problems 12.1-12.13 Online Problems with CES production functions |