Economy [SECOB201]

Learning outcomes

The main objective is the understanding and ability to apply basic economic concepts. At the end of the course, the student will have acquired four types of skills applied to choice issues under scarcity constraints in economics: C1: Knowledge: Definitions, concepts, working hypotheses. C2: Know-how: Applications: mechanisms and effects, tools and measurements. C3: Skills and attitudes: Problems: shaping a complex situation (appropriate use of concepts and tools). C4: Skills and attitudes: Interpretation: putting observations of mechanisms and problems into context.

Objectives

This course is an introduction to the principles and use of economic reasoning in situations mainly related to microeconomics (individual decisions, supply and demand, market, firm behaviour, effects of strategic behaviour and information on the welfare of society). It is intended for students with a second degree in mathematics, or for students with a good basic mathematical background. It has a fourfold objective: - The student begins to approach economic facts as the result of individual and collective decision-making mechanisms and not only of external constraints, - The student begins to develop a coherent argument based on the concepts and tools of economic analysis developed in the course, - In particular, students will learn to use mathematical tools to model economic situations and incentives, - The student gains an overview of the economy, how it works and the material and social problems it deals with.

Content

The course provides an introduction to microeconomic reasoning as applied to the main issues addressed by the discipline. It will consist of four main parts: (1) Introduction: History and concepts of economic reasoning; choice problem and reasoning at the margin, gains from exchange, prices, efficiency and equity. (2) Supply, demand and equilibrium: consumer and business behaviour; short and long term market equilibrium, services and factors in perfect competition; effect of taxes and other economic measures. (3) The limits to competition: monopoly and oligopoly; imperfect competition and innovation. This part will also provide an introduction to game theory. (4) Market failures and possible solutions: externalities; production of public goods; asymmetric information; (subject to change) public choice, elements of analysis of voting and political decision.