Microeconomic Theory I ECON 611-002 Fall 2012 Thursday, 7:20 10:00pm Arlington, Founders Hall 121 Professor Christopher J. Coyne Department of Economics Enterprise 323 ccoyne3@gmu.edu Office hours by appointment COURSE OBJECTIVES: This course investigates the foundations of microeconomics. You will first learn the basic tools of economics: supply and demand, opportunity cost, comparative advantage, and the marginal way of thinking. These basics will provide the foundation for both the rest of this course and also for the second MA microeconomics course, ECON 612. By the end of the course you will have a firm understanding of supply and demand and the role of prices. You will also be able to characterize consumer demand for a product and will have an understanding of entrepreneurship and the nature of competition in different types of markets. You will also understand how to apply the tools of economics to an array of policy issues. REQUIRED MATERIALS: The reading for this course comes from three sources: books, journal articles, and online readings. Books McCloskey, Donald. 1982. The Applied Theory of Price (2 nd ed.). New York: MacMillan. http://www.deirdremccloskey.com/docs/price.pdf Sowell, Thomas. 2011. Basic Economics: A Common Sense Guide to the Economy (4th ed.). New York: Basic Books. The McCloskey book is a standard intermediate micro text and is available online free of charge through the link provided. This textbook is optional reading. The core concepts in the text will align with what we cover in class, although my lectures will be structured differently. The McCloskey text is meant to serve as a reference in case you require further detail or background regarding what is discussed in class. You should read the textbook before contacting me with any questions regarding course material. I have listed the relevant pages for the McCloskey book for each meeting so that you can easily reference the text if you desire. The Sowell book is required reading and is meant to provide you with a baseline foundation for my lectures. This book is available at the GMU bookstore or through online sellers.
Econ 611 2 Journal Articles All of the journal articles listed below are required reading. I have provided links to the journal articles where available. For readings with no link you can access the paper through the GMU library (JSTOR). Online readings All of the online readings listed below are required reading. I have provided links to the online readings below. This is a MA-level course. You are expected to do all of the required readings and come to class prepared to discuss them. SCHEDULED OUTLINE OF COURSE EVENTS: 1. The Economic Approach (August 30) Buchanan, James M. 1964. What Should Economists Do? Southern Economic Journal 30(3): 213-222. Sowell, pp. 1-7; 618-645. 2. The Tools of the Economist (September 6) Anderson, Terry and P.J. Hill. 1979. An American Experiment in Anarcho-Capitalism: The Not so Wild Wild West, Journal of Libertarian Studies 3: 9-29. http://mises.org/journals/jls/3_1/3_1_2.pdf Armen A. Alchian, Property Rights, Concise Encyclopedia of Economics: http://www.econlib.org/library/enc/propertyrights.html Demsetz, Harold. 1967. Toward a Theory of Property Rights, American Economic Review 57(2): 347-359. http://www.econ.ucsb.edu/~tedb/courses/ec100c//demsetz_property_rights.p df 3. Supply and Demand (September 13) McCloskey, 6-50; 71-82. Boudreaux, Donald J. 1995. A Modest Proposal to Deregulate Infant Adoptions, Cato
Econ 611 3 Journal 15(1): 117-135. http://www.cato.org/pubs/journal/cj15n1/cj15n1-7.pdf Buchanan, James M. Order Defined in the Process of Its Emergence http://oll.libertyfund.org/?option=com_content&task=view&id=163&itemid=282#xx01 Sowell, pp. 11-65 4. No class, September 20 5. Consumer Choice (September 27) McCloskey, 84-131 Rizzo, Mario and Douglas Glen Whitman. 2009. The Knowledge Problem of New Paternalism, Brigham Young University Law Review 4: 905-968. http://lawreview.byu.edu/archives/2009/4/4rizzo.fin.pdf Sowell, pp. 95-117. Thaler, Richard and Cass Sunstein. 2003. Libertarian Paternalism, American Economic Association Papers and Proceedings 93(2): 175-179. http://econ.ucsd.edu/~jandreon/econ264/papers/thaler%20sunstein%20aer%202003.p df 6. Costs and Production (October 4) McCloskey, pp. 224-275 Alchian, Armen A. 1950. Uncertainty, Evolution and Economic Theory, The Journal of Political Economy 58(3): 211-221. http://www.sfu.ca/~allen/alchian.pdf James M. Buchanan. 1981. LSE Cost Theory in Retrospect, In, L.S.E. Essays on Cost, James M. Buchanan and George F. Thirlby (eds.). New York: New York University Press. http://www.econlib.org/library/npdbooks/thirlby/bcthls1.html Sowell, pp. 118-148.
Econ 611 4 7. No class, October 11 8. Competition (October 18) Midterm Exam: 7:20 8:30pm McCloskey, pp. 276-289 Hayek, F.A. The Meaning of Competition, in, Individualism and Economic Order. http://mises.org/daily/4181/ 9. No class, October 25 10. Monopoly (November 1) McCloskey, pp. 344-419 Boudreaux, Donald J. and Thomas J. DiLorenzo. 1993. The Protectionist Roots of Antitrust, Review of Austrian Economics 6(2): 81-96. http://mises.org/journals/rae/pdf/r62_3.pdf Sowell, pp. 149-203 11. The Economics of Politics (November 8) McCloskey, pp. 171-195 Sowell, pp. 414-443; 479-495 12. No class, November 15 13. No class, November 22
Econ 611 5 14. The International Economy (November 29) Clemens, Michael. 2009. The Biggest Idea in Development that No One Really Tried, The Annual Proceedings of the Wealth and Well-Being of Nations, II: 26-49. https://www.beloit.edu/upton/assets/clemens.pgs.pdf Neuwirth, Robert. 2011. The Shadow Superpower, Foreign Policy, October 28. http://www.foreignpolicy.com/articles/2011/10/28/black_market_global_economy?page= 0,0&hidecomments=yes Sowell, pp. 499-561 15. Economic Development (December 6) Boettke, Peter J., Christopher J. Coyne, Peter T. Leeson and Frederic Sautet. 2005. The New Comparative Political Economy, The Review of Austrian Economics 18(3/4): 281-304. http://www.ccoyne.com/new_comparative_-_final.pdf Easterly, Williams. 2005. The Utopian Nightmare, Foreign Policy, August 30. http://www.foreignpolicy.com/articles/2005/08/30/the_utopian_nightmare?page=0,0 Leeson, Peter T. Escaping Poverty: Foreign Aid, Private Property, and Economic Development, Journal of Private Enterprise 23(2): 39-64. http://www.peterleeson.com/escaping_poverty.pdf Skarbek, David B. and Peter T. Leeson. 2009. What Can Aid Do? Cato Journal 29(3): 391 397. GRADING AND ASSIGNMENTS: Your final grade is based on a midterm (40%) and a final exam (60%). No additional credit is available. Midterm exam: The midterm exam will be administered at the beginning of class on October 18, 2012, 7:20 8:30pm. The exam will include all material covered up until that point in time. Final exam: The final exam will be administered on Thursday, December 13, 2012 from 7:30-10:15pm. This exam date and time is set by the University and is non-negotiable. The final exam is comprehensive and will include all material covered throughout the semester. No make-up exams are offered under any circumstances, so if you are unable to attend either exam date listed above, it is best to drop the class now.
Econ 611 6 ACADEMIC DISHONESTY: Cheating will not be tolerated and can result in a failing grade, dismissal from class, and expulsion from the university. If I suspect you of cheating, I will seek the appropriate punishment under George Mason University guidelines. Please review the George Mason University Honor System and Code: http://www.gmu.edu/academics/catalog/9798/honorcod.html