HE301-Mathematical Economics
Course Description and Scope
This course intends to familiarize students with the basic mathematical methods that are indispensable for
understanding the current economic literature. The following major types of economic analysis will be
covered: statics (equilibrium analysis), comparative statics, and optimization problems (as a special case of
statics), and dynamics, making use of the following mathematical methods: matrix algebra, differential and
integral calculus, differential equations and difference equations. To underscore the relevance of
mathematics to economics, appropriate economic applications will follow immediately after each
mathematical technique studied.
Proposed Lecture Schedule
Week No.
1
Topics
Lecture 1:
Readings
Class Notes
Review: Calculus and Linear Algebra
2
Lecture 2:
Class Notes
3.1 Classical Optimization
CW Chapters 9, 10, 11
3.2 Economic applications
3
Lecture 3:
Class Notes
4.1 Comparative Statics – Microeconomic applications
4.2 Comparative Statics in Macroeconomics
4
Lecture 4:
Class Notes
5.1 Optimization with equality constraints
CW Chapter 12
5.2 Economic applications
5
Lecture 5:
7.1 Non-linear programming and Kuhn-Tucker
conditions
Class Notes
CW Chapter 13
7.2 Economic applications
6
Lecture 6:
Mid-Term 1
7
Lecture 7:
8.1 Review of Integral Calculus
Class Notes
8.2 The notion of dynamics
CW Chapter 14
Week No.
Topics
8.1 First order Differential Equations
Readings
Class Notes
8.2 Economic applications
CW Chapter 15
8
Recess
9
Lecture 8:
Class Notes
9.1 Higher order Differential Equations
CW Chapter 16
9.2 Economic applications
10
Lecture 9:
Class Notes
10.1 First order Difference Equations
CW Chapter 17
10.2 Economic applications
11
Lecture 10:
Class Notes
11.1 Second order Difference Equations
CW Chapter 18
11.2 Economic applications
12
Lecture 11:
Mid-term 2
13
Lecture 12:
Review
Course Material
Weeks 1-12:
Class presentation slides will be provided
Basic Text (to accompany class notes):
CW: A. Chiang and K. Wainwright
Fundamental Methods of Mathematical Economics, Fourth Edition
Mc. Graw-Hill International Edition.
Call Numer: HB 135. C532
Method of Instruction
Lectures
Tutorials
:
:
2 hours per week
1 hours per week
Lectures commence in Week 1 and end in Week 13
Tutorials commence in Week 2 and end in Week 14
Assessment
Class participation: 10%
Mid-term 1: 15%
Mid-term 2: 15%
Final Exam: 60%