Econ 80A – Intermediate MicroEconomics
Brandeis University
Department of Economics
Office: Sachar International Center, 130A
Professor Benjamin Shiller
Office Hours: TBD
And TBD
Email: shiller@brandeis.edu
Telephone: (781) 736-5205
TA: Mihai (“MACK”) Chitulescu
Email: mchitule@brandeis.edu
Office Hours: TBD
TA: George Velonias
Email: gpvelos@brandeis.edu
Office Hours: TBD
SYLLABUS
80A – INTERMEDIATE MICROECONOMICS
SPRING 2016
Course Description: This course aims to provide a fuller understanding of microeconomic
principles, including (1) developing deeper intuition than in introductory economics courses, and
(2) employing mathematical modeling to more precisely answer economic questions. One of the
main goals of the course is to prepare students with modeling skills which, when later combined
with statistics/econometrics, can be used to understand markets and make informed decisions
based on data. The skills acquired may be useful to CEOs, managers, entrepreneurs, policymakers, lawyers, voters, and citizens, among others. The material is also crucial for more
advanced classes in economics.
Prerequisites:


Math requirement: You MUST have either (a) successfully completed Math 10A (C- or
higher), (b) attained at least a 4 on the AP Math AB test, (c) received at least a 3 on the
AP Math BC test, or (d) passed the calculus placement exam that is administered by the
Economics Department.
Economics requirements: You must have either (a) taken Econ 10A, or (b) taken Econ
2A and received a B+ or higher.
Learning Goals and Objectives:
The first goal of the course is to provide students with a solid understanding of the analytical
tools of microeconomics and skills to apply them to novel problems. The second goal is to be
able to critically evaluate the arguments made by others (e.g. politicians). The third goal is to
1
Econ 80A – Intermediate MicroEconomics
Brandeis University
Department of Economics
Office: Sachar International Center, 130A
Professor Benjamin Shiller
Office Hours: TBD
And TBD
Email: shiller@brandeis.edu
Telephone: (781) 736-5205
TA: Mihai (“MACK”) Chitulescu
Email: mchitule@brandeis.edu
Office Hours: TBD
TA: George Velonias
Email: gpvelos@brandeis.edu
Office Hours: TBD
grasp why certain assumptions are made when formulating economic models. These goals are
intentionally vague – the hope is that the skills acquired can be applied to new problems one
might face in the future.
The objectives are to be able to write down a mathematical model capturing the important
aspects of firms and consumer payoffs, and then solve for the equilibrium outcomes. We will
focus on particular problems. Examples include consumer utility maximization and optimal
pricing by firms in imperfectly competitive markets. By applying these methods to many
different topics and questions, I hope students become familiar enough to extend these skills to
novel problems.
Course Meeting Times:
Mondays and Wednesday 3:30-4:50 (Section I) or 5:00-6:20 (Section II), Pollack 001
Recitation: Mondays, 6:30PM to 8:20PM (First 40 minutes sometimes required), Pollack 001
Electronics in the Classroom:
Laptops are permitted in the front row only. Even then, surfing the internet is prohibited – it is
distracting to other students and to me, the professor, thus impacting the learning environment.
Cellphones are not permitted and should be off or in airplane mode (buzzing on silent mode is
distracting to me, the professor). If you have any related special accommodation requests (for
example are awaiting an important medical-related call), please come see me before the class,
and we will find a solution.
Materials and Communications:
Course materials will be posted on LATTE. You can add to the course calendar, available at this
link: course calendar, to your own online calendar, by clicking on the “+ Google Calendar”
button at the bottom right of the webpage. The course calendar includes important due dates,
and any changes to dates will be reflected in this calendar.
Communication will administered through LATTE.
2
Econ 80A – Intermediate MicroEconomics
Brandeis University
Department of Economics
Office: Sachar International Center, 130A
Professor Benjamin Shiller
Office Hours: TBD
And TBD
Email: shiller@brandeis.edu
Telephone: (781) 736-5205
TA: Mihai (“MACK”) Chitulescu
Email: mchitule@brandeis.edu
Office Hours: TBD
TA: George Velonias
Email: gpvelos@brandeis.edu
Office Hours: TBD
Course Materials:
Textbook: Goolsbee, Levitt, and Syverson, Microeconomics, (Worth Publishers, 2012).
The textbook for this course is available for purchase at the Brandeis Bookstore.
Other Materials: Any other, supplementary materials will be made available on LATTE, or via
links on the syllabus (this document).
Course Requirements/Evaluation:
Success in this four- credit course is based on the expectation that students will spend a
minimum of 9 hours of study time per week in preparation for class (readings, papers, discussion
sections, preparation for exams, research, etc.)
The grade is out of 500 points. If you receive the following number of points, you are
guaranteed at least the following grade:
Get 460 or above
… 420 or above
… 380 or above
Guaranteed at least AAt least a BAt least a C-
A curve will be applied to increase grades only if the grade distribution is lower than department
standards. A curve will not reduce grades below the guarantee above.
The grade is comprised of the following components.
1.
Problem sets (25 points [5% of grade]) – There will be a problem set associated with each
topic. You are advised to work out the problem sets on paper. However, answers are
ultimately submitted online for grading. If the answer entered is wrong, the student will
be informed and may resubmit a new answer up to two additional times. Once the right
answer has been entered, the student will receive full credit on the problem, regardless of
the times they had answered the question. The lowest problem set is dropped. All
3
Econ 80A – Intermediate MicroEconomics
Brandeis University
Department of Economics
Office: Sachar International Center, 130A
Professor Benjamin Shiller
Office Hours: TBD
And TBD
Email: shiller@brandeis.edu
Telephone: (781) 736-5205
TA: Mihai (“MACK”) Chitulescu
Email: mchitule@brandeis.edu
Office Hours: TBD
TA: George Velonias
Email: gpvelos@brandeis.edu
Office Hours: TBD
remaining problem sets count equally.
My policy regarding cooperative work on these problem sets is discussed on the next
page; please read it carefully, and note that working somewhat independently on
problems sets is a crucial step in learning the material.
2.
Six quizzes (150 points [30% of grade]) – held during the beginning of recitation. The
lowest quiz grade is dropped. Hence the remaining five count for 30 points each.
3.
Midterm exam (150 points [30% of grade])
4.
Final exam (150 points [30% of grade]) to be held during the final exam period
5.
Class attendance (25 points [5% of grade]). Up to two absences from class will have no
effect on the grade. Further absences will incur a loss of 3 points each. The instructor
reserves the right to, at his discretion, remove further points for conduct which harms the
learning environment and impacts other students. This includes using laptops/cellphones
to surf the internet, text, and make phone calls, or willfully making disruptive comments
and/or demonstrations, etc.
Please note that there will be NO make-up exams given. Absence from an exam will be
excused only for a serious illness or bereavement (which must be documented). A student who
is unable to take the final exam for a legitimate reason MUST obtain advance authorization
from the Office of Undergraduate Academic Affairs. There are NO EXCEPTIONS to these
rules.
Special Accommodations: If you are a student with a documented disability on record at
Brandeis University and wish to have a reasonable accommodation made for you in this class,
please see me immediately. Please keep in mind that reasonable accommodations are not
provided retroactively.
Academic Integrity: You are expected to be honest in all of your academic work. Please
4
Econ 80A – Intermediate MicroEconomics
Brandeis University
Department of Economics
Office: Sachar International Center, 130A
Professor Benjamin Shiller
Office Hours: TBD
And TBD
Email: shiller@brandeis.edu
Telephone: (781) 736-5205
TA: Mihai (“MACK”) Chitulescu
Email: mchitule@brandeis.edu
Office Hours: TBD
TA: George Velonias
Email: gpvelos@brandeis.edu
Office Hours: TBD
consult Brandeis University Rights and Responsibilities for all policies and procedures related to
academic integrity. Students may be required to submit work to TurnItIn.com software to verify
originality. Allegations of alleged academic dishonesty will be forwarded to the Director of
Academic Integrity. Sanctions for academic dishonesty can include failing grades and/or
suspension from the university. Citation and research assistance can be found at LTS - Library
guides.
POLICIES FOR PROBLEM SETS
1. Problem sets are designed to help you learn how to apply the material presented in
lectures and the textbook. You are permitted and indeed encouraged to discuss course
material, including homework, with other students in the class. Discussion with others is
intended to clarify ideas, concepts, and technical questions. But more importantly,
struggling through the problems independently is a crucial step in learning the
material. If you rely on others for problem sets (even unintentionally), my
experiences from previously classes suggest that you won’t learn the material well.
If you do the work independently, you will become a good economist. For this reason,
there is not penalty for submitting a wrong answer, so long as you eventually submit the
correct answer for the problem (up to three tries per problem, in total).
Beware: if you cannot answer the problem yourself on the problem set, you likely will
also struggle on the quizzes, midterm, and final. Since problem sets only count for 5% of
the grade, they should be viewed and treated as practice for the other components which
have more weight.
2.
Solutions are entered online and provide immediate feedback.
3.
Problem set solutions will be posted.
5
Econ 80A – Intermediate MicroEconomics
Brandeis University
Department of Economics
Office: Sachar International Center, 130A
Professor Benjamin Shiller
Office Hours: TBD
And TBD
Email: shiller@brandeis.edu
Telephone: (781) 736-5205
TA: Mihai (“MACK”) Chitulescu
Email: mchitule@brandeis.edu
Office Hours: TBD
TA: George Velonias
Email: gpvelos@brandeis.edu
Office Hours: TBD
EXAM POLICIES
During exams, you may consult the instructor/proctor administering the exam if you need
clarification of exam questions. No discussion or other form of communication with
anyone else will be permitted after the exams have been handed out, until all
students have turned in their exam books. Students found to have cheated or
engaged in any other unethical behavior will be given a grade of 0 on the
examination involved, and will be turned over to the appropriate disciplinary
committees within Brandeis University for further action. Bathroom breaks during
weekly quizzes and the midterm are not permitted.
If you have any questions regarding these policies, please raise them with the instructor.
6
Econ 80A – Intermediate MicroEconomics
Brandeis University
Department of Economics
Office: Sachar International Center, 130A
Professor Benjamin Shiller
Office Hours: TBD
And TBD
Email: shiller@brandeis.edu
Telephone: (781) 736-5205
TA: Mihai (“MACK”) Chitulescu
Email: mchitule@brandeis.edu
Office Hours: TBD
TA: George Velonias
Email: gpvelos@brandeis.edu
Office Hours: TBD
EXAM DATES TO REMEMBER
Feb 1
Quiz 1, beginning of recitation (6:30 PM)
Feb 8
Quiz 2, beginning of recitation (6:30 PM)
Feb 22
Midterm, during recitation (6:30PM)
Mar 14
Quiz 3, beginning of recitation (6:30 PM)
Mar 21
Quiz 4, beginning of recitation (6:30 PM)
Apr 4
Quiz 5, beginning of recitation (6:30 PM)
Apr 18
Quiz 6, beginning of recitation (6:30 PM)
TBD
Final exam
Jan 13
COURSE OUTLINE
Lecture 1. Intro. Introduction to the course, a discussion of markets, and review
of concepts.
Read: GLS, Chapter 1
Read: Brooks, David. “The Structures of Growth - Learning Is No Easy Task.”
The New York Times. June 16, 2014.
Jan. 18
No Class – Martin Luther King Day
7
Econ 80A – Intermediate MicroEconomics
Brandeis University
Department of Economics
Office: Sachar International Center, 130A
Professor Benjamin Shiller
Office Hours: TBD
And TBD
Email: shiller@brandeis.edu
Telephone: (781) 736-5205
TA: Mihai (“MACK”) Chitulescu
Email: mchitule@brandeis.edu
Office Hours: TBD
TA: George Velonias
Email: gpvelos@brandeis.edu
Office Hours: TBD
Jan 20
Lecture 2. Supply and Demand I. Review of elasticities, cross price
elasticities. Using demand and supply curves.
Read: GLS, Chapters 2 and 3.
Jan 25
Lecture 3. Supply and Demand II.
Government interventions.
Consumer and producer surplus.
Jan 27
Lecture 4. Math Boot Camp. Review of calculus concepts used in later parts of
class.
Feb 1
Quiz 1 in Recitation
Lecture 5. Consumer Demand 1. Introduction to consumer demand analysis.
Preferences, utility functions, MRS, budget constraints, optimal consumption.
Read: GLS chapters 4 and 5
Feb 3
Lecture 6. Consumer Demand II. Deriving demand functions. Income and
substitution effects.
Feb 8
Quiz 2 in Recitation
Lecture 7. Supply Side Theory and Firm Decision Theory.
functions, isocost lines, production with 1 input, 2 inputs.
Read: GLS chapter 6
Feb 10
Review for Midterm
8
Production
Econ 80A – Intermediate MicroEconomics
Brandeis University
Department of Economics
Office: Sachar International Center, 130A
Professor Benjamin Shiller
Office Hours: TBD
And TBD
Email: shiller@brandeis.edu
Telephone: (781) 736-5205
TA: Mihai (“MACK”) Chitulescu
Email: mchitule@brandeis.edu
Office Hours: TBD
TA: George Velonias
Email: gpvelos@brandeis.edu
Office Hours: TBD
Feb 15
No Class – Spring break I
Feb 17
No Class – Spring break I
Feb 22
Midterm in Recitation
Class time will be used as extra review session. I, Professor Shiller, will explain
any questions requested by students.
Feb 24
No Class – Break after midterm
Feb 29
Return midterm exam in class
Mar 2
Lecture 8. Costs.
Brief review of production economics and profit
maximization. Cost concepts: fixed, variable, and sunk; total average, and
marginal cost in the short run and long run. Accounting cost vs. economic cost.
Learning curves, returns to scale, and economies of scale
Read GLS chapter 7
Last day to drop class without a “W” on transcript
Mar 7
Lecture 9. Perfect competition and Monopoly. The firm’s problem.
Assumptions of perfect competition.
Where supply curves come from.
Introduction to monopoly
Read: GLS, Chapter 8 and 9.
9
Econ 80A – Intermediate MicroEconomics
Brandeis University
Department of Economics
Office: Sachar International Center, 130A
Professor Benjamin Shiller
Office Hours: TBD
And TBD
Email: shiller@brandeis.edu
Telephone: (781) 736-5205
TA: Mihai (“MACK”) Chitulescu
Email: mchitule@brandeis.edu
Office Hours: TBD
TA: George Velonias
Email: gpvelos@brandeis.edu
Office Hours: TBD
Mar 9
Lecture 10. Market Power – Monopoly and Monopsony. Markets with only
one firm.
Reading: Thiel, Peter. “Competition is for Losers.” The Wall Street Journal,
September 13, 2014.
Mar 14
Quiz 3 in Recitation
Lecture 11. Price Discrimination. Non-uniform pricing strategies for firms
with monopoly power.
Read: GLS chapter 10
Mar 16
Lecture 12. Price Discrimination II
Read: Ozinek, Adam, Will Big Data Bring More Price Discrimination? Forbes.
September 1, 2013
Mar 21
Quiz 4 in Recitation
Lecture 13. Oligopoly I. Markets with few firms. Quantity setting. Price
setting. Sequential vs. simultaneous actions.
Read: GLS chapter 11
Mar 23
Lecture 14. Oligopoly II. Markets with few firms. Quantity setting. Price
setting. Sequential vs. simultaneous actions.
10
Econ 80A – Intermediate MicroEconomics
Brandeis University
Department of Economics
Office: Sachar International Center, 130A
Professor Benjamin Shiller
Office Hours: TBD
And TBD
Email: shiller@brandeis.edu
Telephone: (781) 736-5205
TA: Mihai (“MACK”) Chitulescu
Email: mchitule@brandeis.edu
Office Hours: TBD
TA: George Velonias
Email: gpvelos@brandeis.edu
Office Hours: TBD
Mar 28
No Class – Spring Break II
Mar 30
Lecture 15. Collusion and Game Theory
Read: GLS chapter 12
Read: Cartels: Just One More Fix. The Economist. March 29, 2014
Apr 4
Quiz 5 in Recitation
Lecture 16. Discounting And Choice Under Uncertainty. Expected values.
Preferences towards risk: risk aversion, risk neutrality, risk loving behavior.
Read: GLS, Chapter 13.
Apr 6
Lecture 17. General Equilibrium and Economic Efficiency I. Cross-Market
Effects
Read: GLS, Chapter 14.
Apr 11
Lecture 18. General Equilibrium and Economic Efficiency II. The
Edgeworth Box. Equity and efficiency. Efficiency in production. Efficiency of
competitive markets.
Read: Edsall, Thoma. “Just Right Inequality” The New York Times. Mar 4,
2014
11
Econ 80A – Intermediate MicroEconomics
Brandeis University
Department of Economics
Office: Sachar International Center, 130A
Professor Benjamin Shiller
Office Hours: TBD
And TBD
Email: shiller@brandeis.edu
Telephone: (781) 736-5205
TA: Mihai (“MACK”) Chitulescu
Email: mchitule@brandeis.edu
Office Hours: TBD
TA: George Velonias
Email: gpvelos@brandeis.edu
Office Hours: TBD
Read: Mankiw, Gregory. “When a Scientist is Also a Philosopher.” The New
York Times, March 22, 2014
Apr 13
Lecture 19. Information. Markets with asymmetric information. Quality
uncertainty and the market for “lemons.” Adverse selection. Moral hazard.
Read: GLS chapter 15
Read: Thomas, Katie. “Study Find Sicklier Enrollees in Earliest Stage of Health
Law.” The New York Times. April 9, 2014.
Apr 18
Quiz 6 in Recitation
Lecture 20. Externalities and market structure. Positive and negative
externalities. How markets respond to correct for market “failure” and forms of
government intervention. Property rights and common property resources.
Read: GLS chapter 16
Read: Governing the Oceans: The Tragedy of the High Seas. The Economist.
Feb 22, 2014
Apr 20
Lecture 21. Public Goods. Pure public goods. Public vs. private provision of
public goods. How much should be provided? Local public goods and the
Tiebout hypothesis. The Median Voter theorem.
Apr 25
No Class – Spring Break III
Apr 27
No Class – Spring Break III
May 2
Course Summary and Review
12
Econ 80A – Intermediate MicroEconomics
Brandeis University
Department of Economics
Office: Sachar International Center, 130A
Professor Benjamin Shiller
Office Hours: TBD
And TBD
Email: shiller@brandeis.edu
Telephone: (781) 736-5205
TA: Mihai (“MACK”) Chitulescu
Email: mchitule@brandeis.edu
Office Hours: TBD
TA: George Velonias
Email: gpvelos@brandeis.edu
Office Hours: TBD
TBD
Final Exam
Summer/Winter Break Suggested Reading:
Frakd, Austin. “How Spreadsheets Can Confuse,” The New York Times, May 26, 2014.
Hartford, Tim. “Big Data: Are We Making a Big Mistake,” Financial Times, March 28, 2014.
Yu, Liren, "Silicon Valley's Youth Problem," New York Times Magazine, March 12, 2014.
To help understand the importance of “causation:” Dynarski, Susan, “Study on Parental
Longevity is Short on Causation,” The New York Times, August 6, 2014.
On planned obsolescence (a topic in Industrial Organization): Mullainathan, Sendhil, “Hold the
Phone: A Big Data Conundrum,” The New York Times
13