Microeconomics I

Microeconomics is the analysis of economic problems and issues starting from the motivation and behavior of individual decision making units (ultimately individual people, grouped into households and business firms). This course introduces basic microeconomic principles –the so called basic Microeconomics- with some intermediate theory. It does not assume any specific previous knowledge, since the mathematics used are simple and subordinated to the economic content.

The basic building blocks are (1) an introduction to the economic science, following with a preliminary study of the basic operation of markets; (2) the analysis of firms, with an examination of their technical relationships and the costs involved, and also of their optimal choice in terms of the use of inputs; (3) the economics of competitive markets and an introduction to other market structures.


Course outline and readings

Problem set 1 (Units 1 and 2)

Unit 1. Preliminaries

  • Pindcyk and Rubinfeld, 1.1, 1.2 and 1.4.
  • Andrés and Martí, chapter 1.
  • Readings: 1.1 Markets for Prescription Drugs, 1.2 The Market for Sweeteners

Unit 2. The Basics of Supply and Demand

  • Pindcyk and Rubinfeld, chapter 2.
  • Andrés and Martí, chapter 2.
  • Readings: 2.1 The Price of Eggs and the Price of a College Education Revisited, 2.2 Wage Inequality in the US, 2.4 The Effects of 9/11 on the Supply and Demand for NYC Office Space, 2.5 The Market for Wheat, 2.6 The Demand for Gasoline and Automobiles, 2.9 Upheaval in the World Oil Market

Problem set 2 (Units 3  and 4)

Unit 3. Production

  • Pindcyk and Rubinfeld, chapter 6.
  • Andrés and Martí, chapter 4.
  • Readings: 6.1 Malthus and the Food Crisis, 6.3 A Production Function for Wheat, 6.4 Returns to Scale in the Carpet Industry.

Unit 4. The cost of production

  • Pindcyk and Rubinfeld, 7.1 – 7.6.
  • Andrés and Martí, chapter 4.
  • Readings: 7.2 Sunk, Fixed and Variable Costs: Computers, Software and Pizzas, 7.4 The Effect of Effluent Fees on Input Choices, 7.5 Economies of Scope in the Trucking Industry, 7.6 The Learning Curve in Practice

Problem set 3 (Units 5 and 6)

Unit 5. Pro t Maximization and Competitive Supply

  • Pindcyk and Rubinfeld, chapter 8.
  • Andrés and Martí, chapter 5.
  • Readings: TBA

Unit 6. The Analysis of Competitive Markets

  • Pindcyk and Rubinfeld, chapter 9.
  • Andrés and Martí, chapter 5.
  • Readings: TBA



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