Advanced Microeconomics

Course goals

Learning objectives
The objective of this course is to deepen students' understanding of the relevant concepts of microeconomics. By the end of the course, the student is able to:

• apply the tools of advanced microeconomic theory to understand and analyse individual decision making, and understand how they relate to choices about goods and services.
• analyse how producers make decisions about what to produce, how to produce it and how much to produce.
• apply the tools of microeconomic theory to real-world examples and case studies of consumer and producer behavior and attitude towards risk.

The theoretical approach of the course (and many of the mathematical tools explained) will set stronger foundations for analyzing economic problems.

Content

Students who are not enrolled in the research master Multidisciplinary Economics should contact the course coordinator for enrollment in this course.

The central theme of this course is centered on Choice Theory. This theory delves into the fundamental models of human behavior, which serves as the basis for the majority of economic analyses. The initial segment of the course will concentrate on consumer behavior. The examination of the relationship between utility maximization, preference maximization, and choice is the starting point for this study. Subsequently, we will delve into the study of demand functions, which depict the relationship between the consumer’s problem parameters and their decisions. We will briefly examine producer theory and provide analogous results from this domain.

The analysis of choice behavior culminates with a discussion of choice under uncertainty. A model of choice behavior under uncertainty will be developed. We will commence with the Von Neumann-Morgenstern expected utility model, which is considered a key component in modern economics. The foundation of this model will be explored and then used to investigate the basic properties of preferences and choices in the presence of uncertainty. This includes measures of risk aversion, rankings of uncertain prospects, and comparative statics of choices under uncertainty.

Format
This course spans eight weeks, with two sessions per week: one lecture and one tutorial. Each week, students are expected to thoroughly review the materials and complete assigned tasks, which will be presented and analyzed during the tutorials. One of the eight weeks is designated as the midterm exam week, during which no meetings will be held. In addition to the weekly assignments, there are several homework assignments that must be submitted prior to each tutorial session.
 
Intended Learning Outcomes
The graduate:

• has broad knowledge of core and state-of-the-art theories and empirical methods in economics
• has knowledge of multidisciplinary aspects of own research specialization
• can think in a logical way
• can critically appraise literature
• can apply acquired knowledge of theories and empirical methods within economics
• can acquire and apply insights from other scientific disciplines

In case online access is required for this course and you are not in the position to buy the access code, you are advised to contact the course coordinator for an alternative solution. Please note that access codes are not re-usable meaning that codes from second hand books do not work, as well as access codes from books with a different ISBN. Separate or spare codes are usually not available.