Univ. of Maryland, College Park
Department of Economics
ECON 461
Dr. Cindy Clement
Section 0101
Spring 2007 Syllabus
Course Description:
We will explore three types of government regulation constraining economic activity: antitrust policy aimed at constraining abuse of market power; “economic regulation” or government setting of prices and/or quantities in various industries; and “social regulation”, or government constraints on various business practices aimed at improving health and safety. For each of these specific types of regulation we will address several general questions, including: Under what conditions does government regulation yield an outcome better for society than “laissez faire”? What regulatory policies and mechanisms have been used in the U.S, and how well have they worked? The course will cover both theoretical models and real-world policy applications.
Course Objectives:
Each student will demonstrate via performance on writing assignments and exams his/her knowledge of:
 Specific economic problems that have prompted government regulation both in the past and the present
 Conceptual analysis of these problems and the corresponding regulatory responses
 Empirical tools used in assessing the size or importance of the problems and the impact of regulation
 The various government agencies that regulate economic activity in the US
Instructor’s Contact Information and Class Logistics:
Office: Tydings Hall 4115D Email: clement@econ.umd.edu
Phone: 301 405 3257
Office Hours: Tuesdays and Wednesdays, 10:30 am to 12:15 pm and by appointment
Class Meetings: Tuesdays and Thursdays, 8 – 9:15 am, Tydings Hall 1118
Course Website: http://elms.umd.edu
If you are registered for this course, you can use your directory ID and password to access copies of this syllabus, instructions for writing assignments, study guides that will be handed out during the semester, correct answers for exams, and my record of your grades.
The University has adopted email as the primary means of communication outside the classroom, and I will use it to inform you if and when class needs to be cancelled due to my illness or inclement weather.
Students are responsible for updating their current email address via the appropriate link on http://www.testudo.umd.edu/Registrar.html
and checking the course website regularly for new information.
Pre-requisites: You are responsible for having completed Econ 306, Intermediate Microeconomic Theory before taking this course.
Textbooks: Economics of Regulation and Antitrust , 4 th edition (2005) by Viscusi, Harrington, and Vernon
(MIT Press)
Expectations of Students: If you attend class regularly, you will be better able to comprehend the textbook and prepare for exams. You are expected to read the assigned chapters before we discuss them in class, with the single exception of the first chapter on the first day. Research shows that students who actively participate in class tend to learn significantly more than those who only passively listen; ask questions, articulate your hypotheses out loud, and if you find that you can’t follow the logic of lectures, please visit my office hours before exams and due dates for assignments.
Students with learning disabilities should get in touch with me as soon as possible.

ECON 461 0101, Spring 2007, Dr. Clement Page 2 of Syllabus
Grades and Assignments: Your grade will be determined by your performance on the following assignments.
The maximum possible points are listed along side each assignment.
4 Writings Assignments: 200 points (50 points each)
Midterm exam: 150 points
Final exam:
Total
150 points
500 points
90% or more of the total possible points will earn an A; 80 – 89% a B; 70 – 79% a C; 60 – 69% will earn a D; and less than 60% will earn a F. I will add a plus sign to total scores above x7.5%; for example, 87.8 would get a B+. I will add a negative sign to grades between below x2%; for example, 71.5% would get a C-.
Department of Economics’ policy on grading requires me to use the grading system I announce at the beginning of the semester in all cases. I cannot make any exceptions, and there will be no opportunities for extra credit.
Instructions for the individual writing assignments will be made available as indicated on the attached schedule, approximately 2-3 weeks before due dates. Late submissions will automatically lose 35% of the possible points.
The midterm is scheduled for March 13th in class, and the final is set for May 17 th , the date indicated by the
University on www.testudo.umd.edu
.
Students are required to take both exams. Make-up exams will be granted only to those students whose excuse complies with University policy. If you believe you need a make-up, please inform me and provide the appropriate documentation as soon as possible. The four valid excuses according to University policy are medical conditions, religious observances, participation in University events at the request of University authorities, and compelling circumstances beyond your control. If you miss an exam and cannot document a valid excuse, your grade will be recorded as a zero. Make-ups will be scheduled for 8 am on Mondays or
Wednesdays unless you have another course that meets during that hour.
Academic Integrity
The University of Maryland, College Park has a nationally recognized Code of Academic Integrity, administered by the Student Honor Council. This Code sets standards applicable to all undergraduate students, and you are responsible for upholding these standards as you complete assignments and take exams in this course. Please make yourself aware of the consequences of cheating, fabrication, facilitation, and plagiarism. For more information see www.studenthonorcouncil.umd.edu

ECON 460 0101, Fall 06, Dr. Clement Page 3 of Syllabus
Apr. 17
Apr. 19
Apr. 24
Apr. 26
May 1
May 3
May 8
May 10
May 17
Schedule of Lectures, Exams, and Due Dates
All chapter references are to the text by Viscusi, Harrington, and Vernon.
Jan. 25 Ch. 1, Introduction
Jan. 30
Feb. 1
Feb. 6
Ch. 2, The Making of a Regulation
Ch. 3, Introduction to Antitrust
Ch. 4, Effiency and Technical Progress
Ch. 4 continued
Writing Assignment #1 given
Feb. 8
Feb. 13
Feb. 15
Ch. 5, Oligopoly, Collusion, and Antitrust
Ch. 5 continued
Writing Assignment #1 due
Writing Assignment #2 given
Feb. 20
Feb. 22
Feb. 27
Mar. 1
Mar. 6
Ch. 6, Market Structure and Strategic Competition
Ch. 7, Mergers
Ch. 8, Vertical Mergers and Restrictions
Ch. 9, Monopolization and Price Discrimination
Discussion of Recent Cases
Review
Writing Assignment #2 due
– reading material posted online
Mar. 8
Mar. 13
Mar. 15
Mar. 20 -22
Mar. 27
Midterm
Ch. 10, Introduction to Economic Regulation
Spring Break
Ch. 11, Theory of Natural Monopoly
Ch. 11 continued Writing Assignment #3 given Mar. 29
Apr. 3
Apr. 5
Apr. 10
Apr. 12
Ch. 12, Natural Monopoly Regulation and Electric Power
Ch. 15, Dynamic Issues in Natural Monopoly Regulation: Telecommunications
Ch. 16, The Regulation of Potentially Competitive Markets
Ch. 17, Economic Regulation of Transportation
Ch. 18, Economic Regulation of Energy: Crude Oil and Natural Gas
Ch. 19, The Emergence of Health, Safety and Environmental Regulations
Writing Assignment # 3 due
Ch. 20, Valuing Life and Other Nonmonetary Benefits
Ch 20 continued
Ch. 21, Environmental Regulation
Chs. 22 and 23, Product Safety and Workplace Health and Safety Ch. 22
Ch. 24, Patents and Pharmaceuticals
Review
Final Exam, 10:30 to 12:30 pm
Writing Assignment #4 given
Writing Assignment #4 due