Spring 2004
Tuesdays & Thursdays, 12:30-1:45, 101 DeBartolo
Office: 410 Decio
Telephone: 1-6434
Email: Ruccio.1@nd.edu
Office hours: Tuesday and Wednesday, 2-4pm, and by appointment
There are three parts to this reading list and course. Part 1 is an introduction to economic theories, economic history, and the concepts of supply and demand. There are many microeconomic theories in the world today. The most prevalent in the United States is called neoclassical economics. Neoclassical economic theory arose within the social (economic, political, and cultural) conditions of the late-nineteenth century. According to neoclassical economists, all economies and economic events can be understood in terms of supply and demand. The first part, therefore, covers the following topics: the basic theoretical debates between neoclassical and other economic theories, the history of neoclassical microeconomic theory, and the basic notions of supply and demand.
Part 2 concentrates on the neoclassical theory of supply and demand. What determines the supply and demand behavior of individuals and firms? According to neoclassical economists, given aspects of nature--preferences, technology, and endowment--are the underlying determinants of supply and demand and, thus, of market prices and the distribution of income. Therefore, in the second part of the course, we will examine the concepts and method of the neoclassical "theory of value," from the initial determinants to the final outcomes, as well as the economic implications of neoclassical microeconomic theory.
Part 3 returns to the issue of different economic theories. It is designed to sharpen your knowledge of neoclassical theory by examining some of the extensions, shortcomings, and criticisms of that theory and by comparing it to alternative theories. We will also discuss the importance of these theoretical differences for economic policymaking and for the other economic decisions that we make on a daily basis.
Together, these three parts comprise the principles of microeconomics: first, a discussion of different economic theories, their history, and the concepts of supply and demand; then, an examination of the neoclassical theory of value; and, finally, an introduction to some of the extensions of neoclassical theory and to the contemporary debate among and between different economic theories.
Course Requirements. All students are expected to complete the assigned readings, before the material is covered in class, and to participate fully in classroom discussions, especially in the discussion sections. In addition, grading will be based on three examinations, one after each part of the course outline. Each of these examinations will make up one third of the final grade.
Texts and Readings. Two textbooks have been ordered for the course: Microeconomics, 17th edition, by Paul A. Samuelson and William D. Nordhaus (hereafter, Samuelson & Nordhaus) and Economics: Marxian versus Neoclassical, by Richard D. Wolff and Stephen A. Resnick (hereafter, Wolff & Resnick). All of the required reading for the course is from these two texts.
Introduction: Economic Theories and History (13, 15 & 20 January)
Samuelson & Nordhaus, Chapter 1 (pp. 3-8)
Wolff & Resnick, Chapter 1
Production Possibilities (22 January)
Samuelson & Nordhaus, Chapter 1 (pp. 8-14)
The Basic Concepts of Supply and Demand (27 & 29 January and 3, 5, 10 & 12 February)
Samuelson & Nordhaus, Chapters 3, 4, and 8 (pp. 155-57)
Exam 1 (17 February)
Introduction: Neoclassical Theory of Supply and Demand (19 February)
Wolff and Resnick, Chapter 2 (pp. 38-50)
Preferences and Demand (24 and 26 February)
Samuelson & Nordhaus, Chapter 5 & Appendix 5
Wolff & Resnick, Chapter 2 (pp. 50-59)
Incomes: Wages (2 and 4 March)
Samuelson & Nordhaus, Chapters 12 & 13 (pp. 243-53)
Wolff & Resnick, Chapter 2 (pp. 59-72)
Incomes: Profits (16 and 18 March)
Samuelson & Nordhaus, Chapter 14 (pp. 274-82)
Wolff & Resnick, Chapter 2 (pp. 72-80)
Costs and Supply (23 and 25 March)
Samuelson & Nordhaus, Chapters 6 (pp. 108-18), 7 (pp. 125-34) & 8 (pp. 147-55)
Wolff & Resnick, Chapter 2 (pp. 80-85)
Conclusions (30 March)
Samuelson & Nordhaus, Chapter 8 (pp. 157-62) & Appendix 14
Wolff & Resnick, Chapter 2 (pp. 85-95)
Exam 2 (1 April)
Comparative Advantage (6 April)
Samuelson & Nordhaus, Chapter 15
Game Theory (8 April)
Samuelson & Nordhaus, Chapter 11 (212-19)
Imperfect Competition (13 April)
Samuelson & Nordhaus, Chapter 9 & 10 (196-98)
Discrimination, Externalities, and Inequality (15 April)
Samuelson & Nordhaus, Chapters 13 (pp. 258-63), 18 (371-81) & 19 (pp. 385-402)
Resnick & Wolff, Chapter 2 (pp. 95-99)
Marxian Economics (20 & 22 April)
Resnick & Wolff, Chapter 3 (pp. 125-71)
Theoretical Differences (27 April)
Wolff & Resnick, Chapter 4
Final Exam (4 May)