August 15-26

Instructor: Nan Zhou

First term: a systematic presentation of microeconomic theory in both its partial equilibrium and general equilibrium aspects. Topics covered will include preferences and utility, exchange, production, theory of the firm, capital and interest, competition and monopoly, stability of equilibrium, and welfare economics.

Second term: a more intensive discussion of selected topics, emphasizing recent contributions.

Prerequisites: 180.301-302 or equivalent and Differential Calculus 110.106 or permission of instructor.

Instructor: Khan, Eraslan, Karni

First term: a comprehensive treatment of macroeconomic theory, including static analysis of aggregate output employment, the rate of interest, and the price level; aggregative theory of investment, consumption, demand and supply of money; empirical work on aggregative relationships.

Second term: the macrodynamic theory of growth, cycles, unemployment and inflation, and selected subjects.

Prerequisites: 180.301-302 or permission of instructor.

Instructor: Maccini, Carroll

Topics of recent research in macroeconomics. Prof. Ball’s course covers nominal rigidities, dynamic-consistency theories of inflation, inflation inertia and the costs of disinflation, monetary policy, costs and benefits of price stability, benefits of output stabilization, alternative policy rules, measuring inflation, unemployment, efficiency-wage theories, the behavior of the NAIRU, macro in middle-income countries, high inflation and stabilization, currency crises. Prof. Carroll’s course analyzes implications of the buffer-stock and habit formation theories of consumption for comovement of aggregate variables and asset pricing. The models are applied to study the phenomena of declining U.S. saving rate, the dynamic relationship between saving rates and growth, and the equity premium puzzle.

Prerequisites: 180.603-604

Instructor: Ball, Carroll

The course is an attempt to provide a framework for discussing the techniques that are used in macroeconometric analysis. Generally the bias that it has is one of looking at these from the perspective of someone analysing macroeconomic data for policy analysis. Consequently, many of the applications considered are drawn from the type of research conducted in central banks and finance ministries. Its emphasis is therefore upon the issues raised by the analysis of time series of macro-economic data. Today there is an emerging literature that looks at micro-economic data as well as conducting cross-country studies. We will tend to ignore that material as the methods used in such research are essentially those of micro-econometrics, although sometimes with adjustments made to reflect the nature of macro-economic time series.

Instructor: Faust, Wright

A review of the theory of decision making under uncertainty and its applications to problems of optimal insurance, portfolio selection, savings decisions and optimal search. Alternative approaches to decision making under uncertainty will be surveyed. Attitudes towards risk will characterized and the issues of measurement and comparability of these attitudes discussed, both in the univariate and multivariate cases; applications will be given. The theory of optimal search will be developed with emphasis on its usefulness for the study of labor markets and unemployment.

Prerequisites: 180.601 and 180.603 or permission of instructor.

Instructor: Karni

The course begins with the Ramsey problem in its undiscounted and discounted variants developed in the context of a general theory that can handle a variety of problems that go beyond one-sector and two-sector growth models to consider problems of resource economics (forestry and fisheries), and those in economics having to do with irreversible and non-shiftable capital. The course deals only with discrete time, however. The problems are challenging enough that one does not need to complicate them with a more difficult mathematical set-up.

Instructor: Karni

This course is taught in four modules. Modules I and II are taught in the first term, and Modules III and IV are taught in the second term.

Module I – Mathematical Methods

This part of the course covers the basic concepts from real and convex analysis
and static optimization theory. Topics include basic set theory, topological ideas
in metric spaces, finite-dimensional linear spaces, convex analysis and static
optimization. The course is taught in the first 6-7 weeks of the Fall semester.
It meets for four hours a week with an additional hour for discussion of problems.

Module II – Classical Microtheory

This part of the course develops classical general equilibrium theory
with a finite number of agents and commodities: in addition to
welfare economics and the basic existence theorems, it also
includes the two-sector model of production, public goods, core allocations
and Nash equilibria of games in normal form. The course is taught in the
second 6-7 weeks of the Fall semester, and meets for four hours a week, with
an additional hour for discussion of problems.

Module III – Game Theory

This part of the course introduces the students to the main game theoretic
tools used in economics research. Topics include normal form games, extensive
form games with perfect information, Bayesian games, and extensive form
games with imperfect information. It is taught over a period of 7 weeks, four hours
per week, with another hour discussion of problems.

Module IV – Information, Incentives, and Mechanism Design

This part covers issues related to uncertainty and asymmetric information,
incentives and mechanism design. Topics include axiomatic expected utility
theory, moral hazard and incentive contracts, adverse selection under signaling
and screening equilibria, social choice and mechanism design theory. It is taught
over a period of 6 weeks, four hours per week, with another hour discussion of
problems.

Prerequisites: 180.301-302 or equivalent and Differential Calculus 110.106 or permission of instructor.

Instructor: Khan (Module II), Eraslan (Module III), Karni (Modules I and IV)

This course is taught in four modules. Modules I and II are taught in the first term, and Modules III and IV are taught in the second term.

Module I – Mathematical Methods

This part of the course covers the basic concepts from real and convex analysis
and static optimization theory. Topics include basic set theory, topological ideas
in metric spaces, finite-dimensional linear spaces, convex analysis and static
optimization. The course is taught in the first 6-7 weeks of the Fall semester.
It meets for four hours a week with an additional hour for discussion of problems.

Module II – Classical Microtheory

This part of the course develops classical general equilibrium theory
with a finite number of agents and commodities: in addition to
welfare economics and the basic existence theorems, it also
includes the two-sector model of production, public goods, core allocations
and Nash equilibria of games in normal form. The course is taught in the
second 6-7 weeks of the Fall semester, and meets for four hours a week, with
an additional hour for discussion of problems.

Module III – Game Theory

This part of the course introduces the students to the main game theoretic
tools used in economics research. Topics include normal form games, extensive
form games with perfect information, Bayesian games, and extensive form
games with imperfect information. It is taught over a period of 7 weeks, four hours
per week, with another hour discussion of problems.

Module IV – Information, Incentives, and Mechanism Design

This part covers issues related to uncertainty and asymmetric information,
incentives and mechanism design. Topics include axiomatic expected utility
theory, moral hazard and incentive contracts, adverse selection under signaling
and screening equilibria, social choice and mechanism design theory. It is taught
over a period of 6 weeks, four hours per week, with another hour discussion of
problems.

Prerequisites: 180.301-302 or equivalent and Differential Calculus 110.106 or permission of instructor.

Instructor: Khan (Module II), Eraslan (Module III), Karni (Modules I and IV)

This is a second-year doctoral course in game theory. The objective is to make sure that (1) students who plan to pursue applied research learn game theoretic tools well enough to fully understand the game theoretic arguments in the papers they read, identify problematic modeling techniques, build and solve their own models; (2) students who plan to pursue theoretical research in game theory get exposed to active research topics. The topics covered varies. Sample topics include repeated games, bargaining, voting, cheap talk, market microstructure, global games and network theory.

Prerequisites: 180.601

Instructor: Eraslan

A review of experience in less-developed countries (LDCs) since 1945, theories of development, economic planning in the LDC context, and models of the development process.

Prerequisites: 180.601, 180.603

Instructor: Gersovitz

Mathematical models of economic behavior and the use of statistical methods for testing economic theories and estimating economic parameters. Subject matter will vary from year to year; statistical methods, such as linear regression, multivariate analysis, and identification, estimation and testing in simultaneous equation models, will be stressed.

Prerequisites: Statistics Inference(180.636), Microeconomic Theory (180.601), Mathematical Economics (180.614). People who wish to audit need the same prerequisites.

Instructor: Hu

Theory and applications of statistical inference. Topics include probability and sampling, distribution theory, estimation, hypothesis testing and simple regression analysis. Statistical applications will be drawn from economics. Prerequisites: differential calculus and linear algebra. Limited to graduate students in economics except by permission of the chair.

Instructor: Wright

This is a graduate course covering many of the major econometric techniques that are used in applied work in microeconomics. These include qualitative and limited dependent variables; switching regression and selection bias models; treatment-effect models; duration models; panel data models; GMM for panel data; related time-series techniques; and other topics as they come up.

Prerequisites: Statistics Inference(180.636), Microeconomic Theory (180.601-602) and Econometrics (180.633). People who wish to audit need the same prerequisites.

Instructor: Woutersen

In this course techniques that are used in applied research in microeconomics are introduced. Focus is on a particular class of models, namely discrete choice models. Well-known models in this class are the logit and probit models. Models that have better properties involve high-dimensional integrals, and this leads us to a discussion of simulation estimation. Finally, dynamic decision models for forward looking agents who face irreversible decisions are introduced. As an application some models in economic demograpy are considered.

Prerequisites: Statistics Inference (180.636), Microeconomic Theory (180.601-602) and Microeconometrics I (180.637). People who wish to audit need the same prerequisites.

Instructor: Hu

The pure theory of trade. Theories of comparative advantage, factor price equalization, trade and welfare, tariffs, trade
and factor movements.

Prerequisites: Corequisites: 180.601, 180.603

Instructor: Krishna

A link between the balance of payments and asset accumulation/decumulation, microeconomics of international finance and open-economy macroeconomics. The section on open-economy macroeconomics covers approaches to balance-of -payments adjustments, theories of exchange rate determination and monetary, fiscal and exchange-market policies under fixed and flexible rate regimes.

Prerequisites: Corequisites: 180.601, 180.603

Instructor: Jeanne

First term: theories of the allocation of time and supply of labor, human capital, demand for labor, market equilibrium, and income distribution. As time allows, other topics, such as unemployment, unions, and compensating differences will be discussed.

Second term: current topics in labor economics. The content will vary from year to year. Likely areas include nature vs. nurture in the determination of earnings, the function(s) of unions the question of the existence of dual labor markets, and internal markets with specific human capital.

Prerequisites: 180.601 Corequisite for 652: 180.633-634

Instructor: Moffitt

Students learn some of the key features of asset-pricee behavior. They also study how researchers test theory, focusing on the advantages and disadvantages of these research designs. The intuition behind practical econometric tools is developed and applied to assent-pricing questions.

Instructor: Duffee
View course website

First term: An investigation of firm behavior in imperfectly competitive industries from a game-theoretic perspective. Firm decision making with respect to price and quantity, entry an d exit, and investment will be explored. Both static and dynamic theories will be presented to address questions related to the intensity of competition and the creation and maintenance of market dominance. The course is largely, though not exclusively, theoretical in content. Though no background in game theory is required, students are encouraged to take 180.618 or some other game theory course concurrently.

Second term: The emphasis in this course is on empirical analysis of firm behavior. The first part of the course focuses on models of the internal organization of the firm. The second part considers empirical analysis of firm behavior in markets, with an emphasis on the “new industrial economics.”

Prerequisites: 180.601

Instructor: Harrington

Instructor: Staff

Instructor: Staff

Instructor: Staff

Instructor: Shore

Instructor: Staff