Syllabus (ECONOMICS)

Course Type: MAJ-11

Semester: 7

Course Code: BECOMAJ11T

Course Title: Advanced and Applied Microeconomics

(L-P-Tu): 5-0-1

Credit: 6

Practical/Theory: Theory

Course Objective:

Learning Outcome: Course Objective: The paper prepares to create special skills of the students over micro economic theories. The further developed issue on consumer theory and market functioning are discussed with most up to date manner. Course Specific Outcome: The learn

1. Consumer Choices & Uncertainty: (20)

5. Consumer’s Surplus; Willingness to pay;
5. Compensating and Equivalent Variation;
5. Intertemporal Choice.
5. The Envelope Theorem and Duality: Comparative Static Analysis

5. Concepts of Lotteries, Applications;
5. Axioms of choice under uncertainty, Expected Utility Function and its properties, Expected Utility Theorem and its proof, Violations of Expected Utility Theorem – paradoxes.
5. Preferences towards risk, Reducing risk – diversification, Insurance, value of information
5. Dynamic Optimization Theory
5. Lagrangian vs Hamiltonian.
5. Control theoretic problem.
5. Use of Hamiltonian-finite and infinite time horizon cases with discrete and continuous time points.

2. Market Behaviour, Social Choice & Game Theory: (25)

5. Static Games of Complete Information

• Strictly dominated strategy,
• Pure and mixed strategy Nash equilibrium,

5. Dynamic Games of Complete Information

• Backwards induction outcome,
• Sub-game perfect Nash equilibrium,

5. Oligopoly Models (Game theoretic approach)

• Cournot,
• Bertrand,
• Stackelberg, and
• Collusive Oligopoly.

5. The Two Basic Theorems of Welfare Economics
5. Kaldor-Hicks Criteria for Welfare Improvement
5. Introduction to the Theory of Social Choice.

Reading References:

• Kreps, D.M., l990, A Course in Microeconomic Theory, Princeton University Press.
• Layard, P.R.G. and Walters, A.W., 1988, Microeconomic Theory, McGrawHill, New York.
• Mass-Colell, A., Whinston, M. and Green, J., 1995, Microeconomic Theory, Oxford University Press, New Delhi.
• Chakravarty S.R., 2010, Microeconomics, Allied Publishers Pvt Ltd.
• Hansen, B., 1970, A Survey of General Equilibrium Systems, McGraw-Hill Book Co.
• Sen, A., 1999, Microeconomics; Theory and Applications, Oxford University Press, New Delhi.
• Varian, H., 2000, Microeconomic Analysis, W.W. Norton, New York
• Quirk, J. and Saposnik, R., 1968, Introduction to General Equilibrium Theory and Welfare Economics, McGraw Hill, New York.
• Henderson, J.M. and Quandt, R.E., 1980, Microeconomic Theory: A Mathematical Approach, 3^rd Edition, McGraw-Hill Book Company.
• Silberberg E and Suen, W., The Structure of Economics - A Mathematical Analysis, 3^rd edition, McGraw Hill Publishing Company, International Edition.
• Johnson, S.R., Hassan, Z.A. and Green, R.D., Demand Systems Estimations, The Iowa State University Press, Ames.
• Malinvaud, E., 1976, Lectures on Microeconomic Theory, North Holland Publishing Company.
• Graff, J.D.E.V. ,1975, Theoretical Welfare Economics, Vikas Publishing House.
• Bator, M. F., 1957, “The Simple Analysis of Welfare Maximisation”, American Economic Review, Vol 47, Reprinted in Townsend (ed): Readings in Price Theory, Penguin.
• Simon, C.P. and Blume, L., 1994, Mathematics for Economists, W. W. Norton & Company.
• Chiang, A.C., 1986, Fundamental Methods of Mathematical Economics, McGraw Hill, New York.
• Chiang, A. C., 1992, Elements of Dynamic Optimization, McGraw-Hill, Inc.
• Conrad, J.M. and Clark, C.W., 1987, Natural Resource Economics: Notes and Problems, Cambridge University Press.
• Allen, R.G.D., 1974, Mathematical Analysis for Economists, Macmillan Press and ELBS, London.
• D. Fudenberg and J. Tirole, Game Theory, MIT Press.
• J.J. Laffont and D. Martimort, Theory of Incentives: The Principal Agent Model, Princeton University Press.
• M. Osborne and A. Rubinstein, A Course in Game Theory, MIT Press
• Mas-Colell, M. Whinston and J. Green, Microeconomic Theory, Oxford University Press,1995.
• Robert Gibbons, 1992, A Primer in Game Theory, Princeton University Press.
• Erik Rasmusen, 1999, Games and Information: An Introduction to Game Theory, Basil Blackwell.
• K. Binmore, 1991, Fun and Games: A Text on Game Theory, OUP.