Econ 302

Econ 302 Microeconomic Analysis

Spring 2013

Professor Fredric S. Lee

[Download the syllabus in pdf]

Lectures:  Tuesday, Thursday, 9.30 – 10.45, Katz Hall 209

Required Texts:  F. S. Lee, Microeconomic Analysis:  Lecture Notes

Optional Text: D. Salvatore, Microeconomics:  Theory and Applications, 5th ed.

Assessment:  

  • In-Class Exam I covers sections I & II, February 21, 2013
  • In-Class Exam II covers section III, March 14, 2013
  • Final Exam covers section IV & V May 13, 2013, 1.00-3.00pm
  • Each in-class exam is worth 25% and the final exam is worth 50% of your final grade.
  • The exams will consist of problems like those found in the problem sets.

The grading scale for the course is the following:

A  100% to 93%           C      76% to 73%

A-  92% to 90%            C-    72% to 70%

B+  89% to 87%            D+  69% to 67%

B    86% to 83%            D     66% to 60%

B-   82% to 80%            F     anything less than 60%

C+  79% to 77%

Problem Sets:  There are problem sets at the end of each part in Lee’s Microeconomic Analysis:  Lecture Notes.  They can be turned in for 10% of extra credit.

Course Description: The course covers microeconomic theory, including consumer behavior and demand, production and costs, markets and competition. The material in the course will be presented critically. The course is concerned with theory—hence abstract reasoning and the use of economic models and mathematics will be stressed.  The level of mathematics utilized in the course will be equivalent to that covered in Math 110 and Math 160.  Math 206 and/or 210 are recommended.

Here are some links to help you with your math skills:

Essential information regarding university policies, rules, and resources: http://cas.umkc.edu/student-resources.asp

LECTURE AND READING OUTLINE

 

I. Introducing Heterodox and Neoclassical Microeconomics

A. Economics and the Economy

  1. Lee, Part I, ch. 1.

B.  Heterodox and Neoclassical Microeconomics

  1. Lee, Part I, ch. 2.
  2. Henry, J. F  2009.  “The Illusion of the Epoch:  Neoclassical Economics as a Case Study.”
  3. Salvatore, ch. 1.

C. Heterodox and Neoclassical Methodology and Modeling the Economy

  1. Lee, Part I, ch. 3.
  2. Salvatore, ch. 1.
  3. Hymer, S., “Robinson Crusoe and the Secret of Primitive Accumulation.”

II. The Business Enterprise: Production and Costs

A.  Heterodox and Neoclassical View of the Business Enterprise

  1. Lee, Part III, ch. 1.
  2. Coase, R.  1937.  “The Nature of the Firm.”  Economica 4 (November):  386 – 405.

B.  The Heterodox Approach to Production and Costs

  1. Lee, Part III, ch. 4.

C. Neoclassical Theory of Production

  1. Lee, Part III, ch. 2.
  2. Salvatore, ch. 7 sections 7.1-7.5.

D.  Neoclassical Theory of Costs

  1. Lee, Part III, ch. 3.
  2. Salvatore, ch. 8, sections 8.1-8.5.
  3. Eiteman, W. J. and Guthrie, G. E.  1952.  “The Shape of the Average Cost Curve.”  The American Economic Review 42 (December):  832 – 838.
  4. Yordon, W. J.  1970.  “The Short-Run Cost Function in Manufacturing.”  Quarterly Review of Economics and Business 10:  55 – 67.

III. Markets and Market Demand

A. Nature of Markets

B. The Heterodox Approach to Market Demand

  1. Lee, Part II, ch. 3.
  2. Hamilton, D. B.  1987.  “Institutional Economics and Consumption.”  Journal       of Economic Issues 21 (December):  1531 – 1554.
  3. Lavoie, M.  1994.  “A Post Keynesian Approach to Consumer Choice.”    Journal of Post Keynesian Economics 16 (Summer):  539 – 562.

C.        Modern Utility and Preference Theory

  1. Lee, Part II, ch. 1.
  2. Salvatore, ch. 3.

D. Consumer and Market Demand Theory

  1. Lee, Part II, ch. 2.
  2. Salvatore, chs. 4 and 5.

IV. Competition, Prices, and Market Governance

A. The Heterodox Approach to Business Enterprise Pricing

  1. Lee, Part V, ch. 4.
  2. Lanzillotti, R. F.  1958.  “Pricing Objectives in Large Companies.”  American Economic Review 48 (December):  921 – 940.
  3. Blinder, A. S.  1991.  “Why are Prices Sticky?”  American Economic Review 81 (May):  89 – 96.
  4. Hall, S., Walsh, M. and Yates, A.  2000.  “Are UK Companies’ Prices Sticky?”  Oxford Economic Papers 52.3 (July):  425 – 446.
  5. Hall, R. L. and Hitch, C. J.  1939.  “Price Theory and Business Behaviour.”  Oxford Economic Papers 2 (May):  12 – 45.

B. Neoclassical Approach to Business Enterprise Pricing, Perfect Competition, and Market Prices

  1. Lee, Part IV, ch. 1.
  2. Salvatore, ch. 9, sections 9.1-9.6.
  3. Brumberg, R. E.  1953.  “Ceteris Paribus for Supply Curves.”  The Economic Journal 63 (June):  462 – 467.
  4. Sraffa, P.  1926.  “The Laws of Returns Under Competitive Conditions.”  The Economic Journal 36 (December):  535 – 550.

C. The Heterodox Approach to Market Governance and Market Prices

  1. Lee, Part V, ch. 5.
  2. Robinson, R.  1961.  “The Economics of Disequilibrium Price,” Quarterly Journal of Economics 75 (May):  199 – 233.
  3. Howe, M.  1972-73.  “A Study of Trade Association Price Fixing,”  Journal of Industrial Economics 21:  236 – 256.

D.  Neoclassical Imperfect Competition and Market Prices

  1. Lee, Part V, chs. 1-3.
  2. Salvatore, ch. 10, sections 10.1-10.3, 11.1-11.7,
  3. Sweezy, P. M.  1939.  “Demand under Conditions of Oligopoly.”  Journal of Political Economy 46 (August):  568 – 573.
  4. Markham, J. W.  1951.  “The Nature and Significance of Price Leadership.”  The American Economic Review 41 (December):  891 – 905.

All of the articles for required readings can be found on JSTOR that can be found at:  http://www/jstor.org/cgi-bin/jstor/listjournal.  Once you have entered it, click on economics to get the appropriate journal and article.  JSTOR can be accessed from any place on campus.

  IMPORTANT NOTES

  1. Policy for Making Up In-Class Exams:  Make ups for in-class exams will be given only to those individuals who have a valid excuse–that is one that I will accept.
  2.  Final Exam:  Students who miss the final exam due to illness or to a University-sanctioned event must call me at my office prior to the exam–otherwise, the exam score will be a zero.  If you are too sick to take the final exam, I require a copy of the receipt from your doctor’s visit (dated the day of the final exam).  If you miss the final exam, I reserve the right to increase the level of difficulty of the make-up final exam, given that you would have had extra time to study for the exam.  Thus, I do not recommend missing the final exam.
  3.  Incompletes:  An incomplete can only be obtained if the student has attended the lectures and has taken all but the final exam.
  4. Policy for Dropping the Course:  See UMKC Bulletin.
  5. Economics is a lot like math–today’s topic builds on yesterday’s topic.  Please ask questions as they arise–if you are confused about today’s topic, chances are you will be even more confused about tomorrow’s topic.  Get your questions answered on a weekly basis.  Do not let your confusion build until the day before the exam.
  6. Cheating on the in-class exams and/or final exam will result in a zero on the exam and a drop in your final grade by one full letter.